$1 Billion Transportation Plan Emerging In Va. Senate
GOP Lawmakers Split Again On Proposals to Raise Taxes

By Michael D. Shear and Rosalind S. Helderman
Washington Post Staff Writers
Thursday, January 19, 2006

RICHMOND, Jan. 18 -- Some Republican leaders in the Virginia Senate will propose as early as Friday a series of tax and fee increases that could grow to about $1 billion a year for road and transit projects, once again setting the stage for a bitter clash over taxes with the House of Delegates.

Their plan will be even larger than the $700 million-a-year proposal the Senate offered two years ago, according to several sources familiar with the plan, most of whom said they didn't want to be named because some details are still being worked out.

"It will be in the range of three-quarters of a billion and $2 billion a year. I'm thinking it will end up right at a billion," said Sen. Charles R. Hawkins (R-Pittsylvania), who chaired a Senate study committee on the topic over the past year and said he will lead the effort to pass the proposals this year.

Gov. Timothy M. Kaine (D) is also scheduled to submit his transportation financing plan Friday, as promised in a speech to lawmakers Monday in which he also asked the General Assembly to give local governments more control over development. Lawmakers and lobbyists in Richmond said they expect Kaine to call for some of the same tax and fee increases.

Sources close to Kaine, who declined to be identified because the governor has not yet signed off on a final draft, said Kaine's plan also may include new borrowing to kick-start stalled projects, higher penalties on abusive drivers, higher auto registration fees and increased taxes on the sale of new cars and trucks.

The release of the Kaine and Senate-sponsored transportation plans has the potential to spark another budget stalemate this year because of opposition to higher taxes in the House.

"We obviously don't favor tax increases," said House Majority Leader H. Morgan Griffith (R-Salem). "It's hard to raise taxes on the people of Virginia when we're running surpluses."

In a report from Kaine's Policy Transition Committee on Transportation, obtained by The Washington Post, advisers to the new governor urged him to push for "reliable, dedicated, and permanent" sources of money for transportation or "face a congestion and mobility crisis."

The report, dated Jan. 5, said Kaine should consider raising the income tax, indexing the gas tax to the rate of inflation, raising the tax on diesel fuel, increasing the use of tolls and allowing urban regions to impose higher taxes to be used in their own areas.

"The dramatic growth Virginia has experienced since 1986 dictates that the General Assembly revisit the current and future transportation needs of the Commonwealth," states the report, marked as "working papers" that are "not approved by the governor-elect."

Delacey Skinner, Kaine's communication director, declined to comment on the report.

In 2004, senators approved a budget with tax increases that would have raised $700 million a year for transportation. That plan was dropped as part of a tax and budget compromise with the House and then-Gov. Mark R. Warner (D) that raised $1.5 billion over two years for schools, health care, public safety and colleges. This year, senators are planning to wage a similar campaign to ease traffic congestion.

Sen. Martin E. Williams (R-Newport News), chairman of the Senate Transportation Committee, said that the plan includes new funding that is "sustainable over time" and that Senate leaders would not raid the budget's general fund -- meant for education, hospitals and public safety -- to pay for roads.

Sen. John H. Chichester (R-Northumberland), chairman of the Finance Committee, said he would reveal nothing of substance about the plan until it is submitted as legislation. Sources familiar with the Senate proposal said it is likely to include several of the following: increases to the sales or income tax, higher taxes on the sale of cars, a new sales tax on gasoline, higher auto registration fees and tolls.

Several senators said not raising taxes would mean leaving road problems to fester.

House Speaker William J. Howell (R-Stafford) has promised that his caucus will soon offer its own proposals to raise money for transportation. The House GOP plan is likely to rely more heavily on the budget surplus for one-time spending.

Lawmakers familiar with the ideas under consideration by the House GOP said they will call for higher penalties on abusive drivers, the use of taxes already collected on auto insurance premiums and more tolls. But they said the House GOP plan will reject higher taxes, saying that the state's surplus should be used to jump-start projects.

Also Wednesday, three Fairfax County Republicans said they would submit legislation by the end of the week that would raise fees on certain drivers solely for Northern Virginia transportation initiatives.

The group, Del. David B. Albo, Del. Thomas Davis Rust and Sen. Jeannemarie Devolites Davis, said that the bills would increase regional fees on truck and trailer registrations and car rentals. They also would impose a "transportation impact fee" on the purchase of homes or businesses in the region and charge a new fee on chronically bad drivers.

The three lawmakers said they hoped to raise $300 million a year for projects that would directly go to road and rail projects in the Washington suburbs.

Staff writer Chris L. Jenkins contributed to this report.