Kaine proposes $1.1 billion tax increase for roads and rail; receives tepid support
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WASHINGTON (Map, News) - Gov. Tim Kaine proposed a series of tax increases Monday to help pay for the state's expanding highway maintenance deficit and pump new money into road and rail projects, but quickly ran into opposition from House Republican leaders and only tepid support from Senate Democrats.

The fees and taxes, Kaine told reporters, would raise nearly $1.1 billion a year for transportation by fiscal 2014, $512 million of which would go toward keeping up Virginia’s aging roads and bridges.

The governor will call lawmakers back to Richmond June 23 to consider the measures, which include a statewide 1 percent tax increase on car purchases, $10 increase to the annual car registration fee and a more than two-fold hike on the tax for selling a house.

Kaine also wants to raise the state’s 5 percent retail sales tax by 1 percent in Northern Virginia and Hampton Roads, which would pay for local and regional projects in those congested urban regions. The increase would exclude food and medicine.

House Republican leaders accused Kaine of drumming up a panic over the maintenance deficit to pressure legislators into approving the tax increases, which they argued would drive up the cost of homes and cars and hurt two already ailing industries.

“I think it’s ill-timed,” said House Majority Leader Morgan Griffith, R-Salem, at a news conference. “But the governor has the prerogative to call us back into special session and waste the taxpayers’ dollars if he so desires to.”

The Senate's Democratic majority issued a statement outlining “concerns over some aspects of the plan” in the amount of funding and whether the proposal would adequately tax out-of-state drivers, who use the state’s roads.

Kaine’s plan did not include an increase in the gas tax.

Contained in the package is $50 million a year in dedicated funding for Metro, which the governor hopes will convince federal officials the transit system is funded well enough to handle the planned Dulles Rail’s 11.6-mile expansion into Fairfax County.

In selling the proposal, Kaine pointed to a bridge collapse in Minnesota last year that killed 13 people.

 “The consequences of not focusing on maintenance are very obvious and potentially severe,” he said.

 The taxes would be collected by the state and not by the regional taxing authorities that were empowered under last year’s transportation funding plan and this year declared unconstitutional by the Virginia Supreme Court.

wflook@dcexaminer.com


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Comments from Examiner Readers

2:16 PM MST on Wed., May. 14, 2008 re: "Governor’s plan revives NVTA"

Examiner Reader said:
I think the NVTA is tarnished. It can't continue. Kaine needs to come up with something else. Indeed, Northern Virginia and the Tidewater are the econonic engines of Virginia. We put more in the coffers than we get out.

6 agree | 2 disagree
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1:41 PM MST on Wed., Mar. 26, 2008 re: "Kaine signs tax refund law; paybacks should start in April"

Jason said:
Taxation without representation. Hello! We fought a war over this! I thought that the sales tax being raised to 5% was suppose to take care of all our road problems? Another government LIE! Keep drinking the Koolaid people. You won't be happy until you are shoved into a FEMA camp!

7 agree | 5 disagree
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6:57 AM MST on Tue., Mar. 25, 2008 re: "Taxpayers face different systems to receive $24 million in refunds"

GMU92 said:
What a colossal mess. They shouldn't have collected a dime until a ruling was handed down by the VA Supreme Court. It's gonna take 3 months to return property and registration fees? Good grief, that data is readily available to them. And now people have to go rummaging around for old receipts from car rentals and hotel rooms? You know some of these people will never know to apply and won't see that money ever again. Wow, the Commonwealth messed this one up badly.

8 agree | 3 disagree
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5:04 AM MST on Tue., Mar. 25, 2008 re: "Taxpayers face different systems to receive $24 million in refunds"

Abolish the NVTA said:
Are the victims of the illegal NVTA taxes going to receive market rate interest on the monies that were taken from them? After all, there is a time value to money. The NVTA apparently didn't have a very good accounting system in place if they can't issue refunds directly and efficiently. This is yet another example of their sheer ineptitude and arrogance. The NVTA should follow in the footsteps of their "sister" organization in Hampton Roads and shut down AFTER refunding the people's monies.

6 agree | 3 disagree
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10:04 AM MST on Thu., Mar. 6, 2008 re: "Gas tax plan roils Senate debate over N.Va. transportation fix"

Chambek said:
If our elected officials would spend some time working out ways to spend OUR money better, we would not be in this predicament. Their answer to everything is to seek out a new revenue source. They have wasted lots of time and lots of OUR money throwing new taxes against the wall to see what sticks. Gov. Kaine shows little regard for Virginians. He is using use to advance his political career as a tax and spend democrat. I guess we really have only ourselves to blame - we put him in office. Fool me once .......

5 agree | 4 disagree
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9:50 AM MST on Thu., Mar. 6, 2008 re: "Gas tax plan roils Senate debate over N.Va. transportation fix"

Examiner Reader said:
NOVA sends more revenue to the State than it receives back. If the entire State isn't going to be taxed to fix this transportation crisis, then the formula should be changed so that NOVA isn't supporting the rest of the state. I support a gas tax increase - how would we even feel it when it's buried in the monthly 10 cent a gallon hikes we've had for the past two years? The other option is to cut spending. Just ignoring the issue is NOT an option. The House needs to govern!

4 agree | 4 disagree
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9:06 AM MST on Thu., Mar. 6, 2008 re: "Northern Virginians brace for seven new taxes, fees"

Examiner Reader said:
We are being taxed out of the area. The cost of living is getting out of control and I really don't know why that is always the answer to everything. Maybe they need to start looking into what they are paying themselves and start the cuts there.

3 agree | 2 disagree
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8:25 AM MST on Thu., Mar. 6, 2008 re: "Gas tax plan roils Senate debate over N.Va. transportation fix"

Examiner Reader said:
My comment regards the issues of raising money for road funding ONLY in the Northern Virginia and Hampton Roads area. Why the should the entire state have to suffer with any extra taxes if the only people to benefit are the ones in the two areas mentioned? How would citizens located in Central, South and Southwest Virginia personally benefit other than have less money to spend in an already high unemployment area? Maybe this talk a few years ago about how Northern Virginia was considering to be a separate entity from the rest of the State (Northern Virginia and Virginia) should be resurrected and re-hashed over again. You would then have two budgets.

4 agree | 3 disagree
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9:41 AM MST on Mon., Dec. 31, 2007 re: "Kaine promises no new taxes despite shortfall"

Examiner Reader said:
Just got to love Kaine's scare tactics. He needs to cut spending and take his pet project off the table to have any chance of passing a non tax raising budget. Chris

55 agree | 55 disagree
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9:35 AM MST on Mon., Dec. 31, 2007 re: "Northern Virginians brace for seven new taxes, fees"

Examiner Reader said:
Kaine is raising taxes just like Maryland's Gov. O'Malley. Thankfully Virginia has more sense and will elect a Republican governor in 2008. Chris

67 agree | 61 disagree
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12:04 AM MST on Thu., Dec. 6, 2007 re: "Kaine promises no new taxes despite shortfall"

Examiner Reader said:
That old 70;s song is back "Here comes that Rainy day feeling again" Kaino will surely get his money after the Jan session opens, they do it the old fashioned way, they just up your taxes

76 agree | 63 disagree
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