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Senate Panel Sends Through Gas Tax Increase: At Issue: Taxes or Tolls?

June 25, 2008

By Olympia Meola, Jim Nolan and Jeff E. Schapiro, Richmond Times-Dispatch, Va.

Jun. 25–A fix for transportation that relies on higher fuel taxes is headed to the Virginia Senate.

Voting on party lines, the Democrat-controlled Senate finance committee this morning endorsed legislation raising the gasoline tax a penny per gallon — per year — for the next six years. The increase would be applied to the wholesale price of gasoline, not what Virginians pay at the pump. The bill is carried by Senate Majority Leader Richard L. Saslaw, D-Fairfax.

Democrats hope to use their slender advantage in the senate to send the bill over to the House of Delegates, where the Republican majority has pledged to oppose higher taxes for roads and rail.

It’s the third day of a special transportation session of the General Assembly. Legislators and lobbyists in both parties have little hope that the legislature will come up with a remedy for a $1 billion hole in the state’s road-construction and maintenance program.

This is the third time in as many years that Gov. Timothy M. Kaine and the legislature have attempted to find new dollars for transportation.

“I just don’t see any reasonable solution coming out,” Sen. Walter A. Stosch, R-Henrico, a ranking moderate who is resisting higher taxes, said yesterday. “The willingness and flexibility to reach any reasonable solution does not appear to be present in the House and Senate.”

The Republican-controlled House of Delegates favors tolls, while the Democratic-dominated state Senate prefers increased taxes, reflecting the partisan divide that continues to complicate efforts to close a $1 billion hole in the road-building and maintenance program,

Kaine is proposing a blend of taxes and fees.

House Republicans, meanwhile, moved legislation promoting their agenda through committees yesterday.

A proposal by Del. Phillip A. Hamilton, R-Newport News, to add tolls in Hampton Roads to pay for several projects in that area sailed through the House Transportation Committee.

Secretary of Transportation Pierce R. Homer opposed the measure, urging caution for “a very large policy step.”

Homer voiced support for a committee-endorsed bill requiring independent audits of agencies within his secretariat, with an emphasis on the Virginia Department of Transportation and the Department of Rail and Public Transportation.

The audit would be paid for out of VDOT’s budget and could cost between $4 million and $6 million according to the bill’s sponsor, Del. L. Scott Lingamfelter, R-Prince William.

Members of the House Privileges and Elections approved two bills creating so-called lockboxes for transportation money — one for statewide projects, the other for regional needs, with the dollars restricted, by law, to those specific ventures.

Though the assembly could finish up late today or tomorrow — few legislators or lobbyists expect agreement — some lawmakers are proposing putting off final action until mid-July.

Sen. John C. Watkins, R-Powhatan, suggested in a floor speech that the Senate’s finance and transportation committees should hold public hearings around the state before agreeing, if at all, to pump additional cash into roads and rails.

“If we’re going to be changing the direction of financing . . . we owe it to the people to let them know what we’re doing, and how and when we’re doing it,” said Watkins.

But Sen. Mary Margaret Whipple of Arlington County, head of the Senate Democratic Caucus, said there’s been plenty of talk, but no action.

“In my district, they’ve heard enough,” said Whipple. “They want us to do something.”

Kaine held 10 public town hall-style meetings across the state to explain his plan. He is proposing an increase in vehicle-registration fees and the auto sales tax to fund highway maintenance.

He also favors a rise in the property seller’s tax and regional sales tax increases in Northern Virginia and Hampton Roads, with the funds devoted to projects in those traffic-clogged regions.

Yesterday, Kaine again signaled that he is not wedded to his plan and would not reject a proposal that clears the assembly — as long as it includes funding for statewide maintenance and the distressed regions.

“If everyone gets a plan on the table, we’ll cobble together some kind of plan and make it work,” he said during his monthly call-in show on Washington radio station WTOP.

“I’m not going to veto it,” Kaine said. “We’re going to make it happen.”

One source of transportation funding that won’t happen is revenue from offshore drilling.

Senators yesterday rejected bills seeking permission from the federal government to conduct natural gas exploration and drilling off Virginia’s coast.

This afternoon, the House Rules Committee is expected to take up Kaine’s bill, sponsored by Del. Ward L. Armstrong, D-Henry.

The Rules Committee, known for snuffing out legislation, has the authority to send bills directly to the House floor for a vote without a recommendation. That could set up a do-or-die floor vote on Kaine’s bill as well as on Senate legislation calling for higher gas taxes.

“This is a politically motivated session,” said Del. William R. Janis, R-Henrico. “That’s all it is.” Contact Olympia Meola at (804) 649-6812 or omeola@timesdispatch.com.

Contact Jim Nolan at (804) 649-6061 or jnolan@timesdispatch.com.

Contact Jeff E. Schapiro at (804) 649-6814 or jschapiro@timesdispatch.com.

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Copyright (c) 2008, Richmond Times-Dispatch, Va.

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