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Gov. McDonnell’s Roads Plan Evokes Mixed Responses

January 15, 2013

By Allison Landry
Capital News Service

RICHMOND – Legislators representing the city of Franklin have mixed feelings over Gov. Bob McDonnell’s plan to boost funding for transportation in Virginia by replacing the long-standing gas tax with an increase in the state’s sales tax designated for transportation.

Democratic Delegate Roslyn Tyler, who represents the 75th House District, said she was surprised that McDonnell wants to eliminate the 17.5-cents-per-gallon gas tax and instead raise the sales tax from 5 percent to 5.8 percent.

“As I hold town hall meetings to gain citizen input, individuals were willing to have a 1 to 2 percent increase in the gas tax because putting an increase on sales tax is basically going to affect all Virginia residents,” Tyler said.

“Right now, I think [this legislation] is just going to be a work in progress, because you have individuals on both sides of the aisle that don’t particularly like certain portions of the plan. So I think there is going to be a lot of room for negotiation until we actually get a good transportation plan.”

Tyler said Sen. John Watkins, R-Powhatan, and Delegate Vivian Watts, D-Fairfax, have each proposed transportation funding alternatives to McDonnell’s plans.

Senate Bill 717, proposed by Watkins, would impose a 5 percent tax on gas at the wholesale level. It would add 14 cents a gallon at the pump and raise about $734 million. This would avoid another revenue-generating idea by McDonnell – to increase the use of tolls.

Watts introduced House Bill 1472 to impose a motor fuels sales tax rate of 5 percent for highway maintenance as well as a 0.5 percent increase in the state sales tax for transportation projects in Northern Virginia. Moreover, her bill would boost the recordation tax by $0.40 per $100 valuation to increase funding for transportation projects and maintenance. (Virginians pay a recordation tax when they file a deed, contract or other legal instrument with local government.)

At the same time, HB 1472 would reduce the sales tax on food from 1.5 percent to 1 percent.

Sen. Harry Blevins, R-Chesapeake, says McDonnell’s proposed overhaul of the transportation funding system poses both advantages and disadvantages.

“I’ve had people that were in favor [of the transportation proposal] and thought it was creative and a way of solving some of the problems,” said Blevins, who represents the 14th Senate District. “But then there’s the question of whether or not it will do any harm to the places that money from the general fund goes to – primarily education.”

Blevins noted that the General Assembly set the gasoline tax at 17.5 cents per gallon in 1986.

“Back then, if you bought a tank of gas for a dollar, you could drive several hundred miles. But now that same dollar won’t buy you a half a tank of gas,” Blevins said. “So, we didn’t raise any more money even with the price going up. I think that if we would have done something about that back then, we wouldn’t be quite where we are today.

“Personally, I think a gas tax is a user fee, and it ought to be something we do consider seriously. In the absence of what we have … [McDonnell’s bill] may be the only thing we can hope to have some relief from transportation issues.”