RICHMOND — A key committee meeting Tuesday could offer a glimpse of what a possible compromise on Gov. Robert F. McDonnell’s transportation funding plan would look like.
And lawmakers from both sides and transportation experts say the least likely element to survive is the centerpiece of McDonnell’s proposal: eliminating the gas tax for an increase in the sales tax.
McDonnell (R) signaled Monday that he too was willing to deal, even as he visited Northern Virginia to make a sales pitch for his transportation funding plan to the most populous — and arguably one of the most gridlocked — areas of the commonwealth.
“We are on the brink of having significant success,” McDonnell said, referring to his transportation initiative. “The time for politics is over. It’s time to get this done.”
McDonnell urged Northern Virginians to pressure their legislators, saying his plan offered the best hope for frustrated commuters. But McDonnell also said he would consider a compromise that might include a combination of his sales tax proposal, a gas tax increase or a gradual phasing out — rather than a full end — of the gas tax.
Now that a divisive spat over redistricting has been ended, legislators from both parties have said a transportation compromise might be possible. But with the annual session past the halfway mark and key legislative deadlines looming, both sides must move fast. The House version of the transportation plan — the only surviving version — will have to win approval from the Senate Finance Committee by Tuesday and clear the full Senate by Wednesday to remain viable. Del. S. Chris Jones (R-Suffolk) said a compromise could then be worked out in a conference committee by the middle of next week.
Lawmakers on both sides say the chances for a deal improved after House Speaker William J. Howell (R-Stafford) used a procedural maneuver last week to kill the Senate Republicans’ surprise redistricting bill.
McDonnell’s plan would raise $3.1 billion over five years, while the commonwealth needs at least $1 billion a year. Without an infusion of money, the state’s highway construction fund would be broke by 2017. The state has had to make do with less revenue from the tax on gasoline and diesel fuel, which has been frozen at 17.5 cents per gallon since 1987. If indexed for inflation, it would be 37 cents today, Chase said.
When asked about whether the elimination of the gas tax would survive negotiations, Howell told reporters that lawmakers were considering its removal.
“I think what comes out of the conference committee will be somewhat different than what goes in,” Howell said. “That [gas tax element] could be a change.”
Lawmakers from both parties and transportation experts say a deal also may require Republicans to raise revenue, perhaps by agreeing to index the gas tax to inflation or boosting the sales tax, while Democrats may have to budge on their refusal to use general fund revenue on roads and highways. A deal may also have to address the desire by cities and urban counties, such as Fairfax and Arlington, to include regional funding options.
“To please all Northern Virginians, and Hampton Roads people, and people on both sides of both parties, there has to be regional funding options,” Christian Deschauer, the Fairfax County Chamber of Commerce’s director of government relations, said Monday.
Bob Chase, president of the Northern Virginia Transportation Alliance, speculated that a deal might include a gas tax increase of 8 to 10 cents per gallon — which is less than what Democrats have wanted but more than Republicans would like — and perhaps a half-cent increase in the sales tax to raise $1 billion a year. Chase also said he expected to see the revival of several ideas contained in bills or amendments as both chambers move toward a possible compromise.
Senate Democratic Leader Richard L. Saslaw (D-Fairfax) had unsuccessfully pushed for a bill that would have raised transportation revenue by increasing the state sales tax by one percentage point, from 5 percent to 6 percent, while Sen. Frank W. Wagner (R-Virginia Beach) proposed a plan of his own that he said would have raised $962 million a year.
Wagner proposed eliminating the fuels tax, replacing it with an 8 percent tax on the wholesale price of fuel. In a passionate floor speech, Wagner all but begged his Senate colleagues to back his plan or step up with proposals of their own.
“I’ll stay here ’til the sun comes up,” he said. But only seven senators voted for his plan.
When the transportation bill moved through the House, Northern Virginia delegates from both parties were largely united in their concerns that the General Assembly grant them the authority to find regional funding solutions. But they also want to make sure that Richmond doesn’t use regional funding plans as an excuse to foist most of the funding responsibility onto urban localities when it should be the responsibility of the state.
As a result, several expressed alarm over a measure — passed by the Senate and sponsored by Sen. Walter A. Stosch (R-Henrico) — that would make it easier for some jurisdictions to impose a local income tax to pay for roads.
Sen. J. Chapman “Chap” Petersen (D-Fairfax) said the sum is also considerable: for a family with taxable income of $200,000 a year, such a tax could mean paying $2,000 more for roads and highways.
“It’s as if we’re letting the state off the hook,” Petersen said.
Errin Haines, Tom Jackman and Laura Vozzella contributed to this report.