Tom Warne Report, 18 May 2013
RICHMOND – The tense final days of Virginia’s legislative session have led to a landmark $6 billion transportation funding bill, which was signed this week by Gov. Bob McDonnell.
The governor praised the measure as a bipartisan effort 27 years in the making – as the last time state lawmakers put a major investment toward roads was in 1986. In the bill, lawmakers decided to find a new way to finance transportation in the state by converting the 17.5-cent gas tax into a wholesale tax, raising the state sales tax to 5.3 percent and committing more existing revenue to be spent on road needs. To that end, the car title tax will be raised and transportation will also get money from anticipated internet sales tax revenue.
The measure will generate separate funding in Northern Virginia and Hampton Roads to pay for priority projects in those areas.
In response to criticism from fiscal conservatives, McDonnell said frustration is commonplace with any such compromise. “There will be something in this bill that everyone does not like.”
Sales tax is much more responsive to the ups and downs of the economy. This is a good transition for Virginia and a major milestone for a state that has struggled putting a package together for a long, long time. TW