Sense of Urgency or Acknowledgment of Need
For Public to Pay Fair Share Still Lacking
Governor Bob McDonnell opened his remarks at his Governor's Transportation Conference by stating, "When you are a one-term governor, you are in a hurry to get things done."
However, the benefits of what the Governor proposed would occur at various points far in the future as opposed to providing the immediate, sustained, new revenue Virginia's transportation program needs and Northern Virginia's private and public sectors have long advocated.
The Governor said additional proposals and details would be announced prior to the start of the 2012 General Assembly. So it remains possible that new, sustainable revenue is part of the Governor's plan. Today's announcement included the following:
- Future State Surpluses: Increase the percent of surplus state dollars dedicated to transportation to 75%. (Surpluses are not annual or predictable.)
- Tax Increment Financing: Transportation investments spur economic development. However, currently all new state revenue generated by such development goes to the General Fund. Under this proposal a percentage of this new, project-related revenue would go to transportation. (Road and transit projects can take a decade or more to complete. New revenues are also years/decades away.)
- Revenue Sharing: Make local maintenance projects eligible for state revenue sharing funds. (This helps leverage local funds but does not increase state funds.)
- Retail Sales and Use Tax: Increase transportation's share of the exiting 5% sales tax from .5% to .75% over an 8-year period and use revenue to lessen the maintenance fund drain on the Transportation Trust Fund for construction. (At the end of eight years this produces upwards of $300 million/year for maintenance, but still falls short of the $500-$600/million/year needed to completely stop the drain. And during that 8-year period $1-$2 billion more in construction funds would be shifted to maintenance. Not to mention the fact that the General Fund would lose hundreds of millions.)
- Revenue Growth: In years in which state revenue growth exceeds 5%, dedicate the first additional 1% to transportation. (Revenue growth has not approached 5% for several years and there is no way of projecting how frequently it will occur in future years.)
To read the Governor's press release, click here.
The Governor also noted that gasoline tax revenues continue to decline due to greater vehicle mileage. Not said is the fact that this means that motorists are driving more and paying less in taxes per mile and therefore could be asked to pay higher tax rates that in today's dollars would still be less than those paid 25 years ago.
Again the Governor promises, "There's more to come."
--most of what was promised today
will come much later, rather than sooner.