Newman proposes changing McDonnell’s plan to revamp the way Virginia pays for road construction and repairs, mass transit and other transportation needs. Tuesday is the session’s midway point and the deadline for all legislation to clear one chamber or the other to remain viable.
In the House on Monday night, legislators debated McDonnell’s bill — sponsored by Speaker William J. Howell (R) — for nearly two hours. The amended version of the plan, offered by Del. Chris S. Jones (R-Suffolk) was approved by a 60 to 39 vote, with only two Democrats voting in favor of the substitute. Nine Republicans voted against it.
Jones’s proposal was further altered to add a review of prospects for local regional transportation funding options and to eliminate a proposal for tolls on Interstate 95 south of Fredericksburg. It would also nix the $100 alternative fuel vehicle fee initially proposed by McDonnell.
“We’re very pleased by the positive actions taken tonight by the House,” said Tucker Martin, a spokesman for McDonnell. “These were all friendly amendments.”
The plan McDonnell (R) put forth would eliminate the state’s 17.5-cents-per-gallon gas tax, raise the sales tax from 5 to 5.8 percent and boost car registration fees by $15. By 2018, the governor’s plan would also take $283 million a year from the general fund, which funds services such as education and law enforcement.
McDonnell says his plan will bring in $845 million a year by fiscal 2018. He is counting on federal legislation to deliver $250 million of that, betting on a bill — long stalled in Congress — that would give states the authority to make online retailers collect sales taxes.
Newman’s legislation would remove the 17.5-cents-per-gallon tax on gasoline and diesel fuel — McDonnell’s plan had kept the tax on diesel— and replace it with a new 5.5 percent sales tax on the wholesale price of fuel. The sales tax would remain at 5 percent for other items under Newman’s plan, which also does away with the fee increases called for under McDonnell’s proposal.
Newman’s plan would lose about $20 million in fiscal 2014, but he said with inflation and increases in the cost of gas, it would bring in $500 million to $650 million a year by 2018. Those figures also count on $200 million a year from federal legislation related to collecting online sales tax.
“This bill is a very conservative approach, but I think in the end it could find enough votes at the other end of the hall, and maybe even here,” said Newman, referring to the House and Senate, respectively.
Newman’s version is likely to be a much tougher sell in the Senate than in the more conservative House. Democrats and some moderate Republicans in the Senate have opposed taking money from the general fund, saying it would shortchange schools and other essential services. They have also said the plan does not raise enough money, saying the state needs at least $1 billion a year in new road funding.
“I find the diversion of over $800 million of general fund money, out of which we pay for public education and public safety, very troubling,” said Sen. A. Donald McEachin (D-Henrico), referring to the total over five years.
In a statement issued Monday afternoon, Cuccinelli (R), who is running to succeed term-limited McDonnell, urged lawmakers to support Newman’s proposal.
“Today, Senate Transportation Committee Chairman Steve Newman is advancing an alternative that I believe has the best chance to get the votes needed to make improvements to Virginia’s transportation system,” the statement read.
McDonnell rolled out his transportation plan in early January with a written endorsement from Cuccinelli, but it was a tepid one, with the attorney general taking pains to note that his role was to make sure the bill was constitutional.
Cuccinelli praised the governor then for “putting some fresh and innovative ideas on the table,” adding: “[I]t’s my job as attorney general to advise the governor and lawmakers of the legal intricacies of each proposal presented in this session, and I intend to be actively involved in doing just that.”
Cuccinelli has positioned himself to the right of McDonnell’s transportation plan as Lt. Gov. Bill Bolling (R), who is exploring an independent run for governor, has sought to find middle ground on the issue. Bolling declined to comment, saying he has not reviewed the legislation.