Time for Northern Virginia to Take Road Less Traveled
For years, residents and businesses of Northern Virginia have complained that, when it comes to state taxes and state spending, there's a two-lane highway heading down to Richmond, and a one-lane road coming back.
The precise data on this is a bit hard to pin down, but it works out something like this: Northern Virginia accounts for just over a quarter of the state's population, pays about half of state taxes and fees, and is the beneficiary of about a third of the state's spending. No wonder, then, that Northern Virginians have come to look on the state budget as a con game in which downstate Republicans refuse to tax themselves while picking the pockets of their more productive neighbors to the north.
Given that reality, it is a little hard to understand all the bellyaching this week from officials, interest groups and editorial writers about the transportation bill passed by the Republican legislature. Here's a bill, after all, that finally lets Northern Virginians tax themselves and keep all the money in the region, to be used to widen overcrowded roads and fund the Virginia share of Metro's operations. It even shifts control of state roads to counties, along with a pro-rata share of the state's road construction budget, and perhaps even a few trucks thrown in.
Instead, Northern Virginia leaders want to hold out for an increase in state taxes -- the very taxes that require them to pay more and get less. And instead of control over their own roads, they want to continue with system in which local officials beg some bureaucrat in Richmond every time they want a new stop sign or curb cut.
Having spent 90 minutes Wednesday afternoon trying to get from Tysons Corner back to the District, I can't say I have much sympathy with the idea that Gov. Timothy M. Kaine should veto this bill and hope that a new legislature under the Democrats will do better in 2009. No, it's not a perfect bill. And no, it's not as much money as the region needs to fix and expand its transportation infrastructure. But it's a big step in the right direction, which, in the context of Virginia politics, is probably as good as we're going to get right now.
Much of the opposition has centered on the fact that the package would steal $250 million a year from the state's "general fund" -- the source of state money for things like education, health care and public safety -- and give it to transportation, which has, by tradition, been financed through such user fees as gasoline taxes and auto registration. In fact, if you look closely, it's only $184 million in 2010, and declines every year after that. Of that figure, about $60 million would have been spent in Northern Virginia.
How much is $60 million? In the context of about $6 billion spent by local government in Northern Virginia about 1 percent, or less than half of one year's increase in the region's general fund receipts. And anyone who would have you believe that redirecting that amount of money will deny children their schoolbooks, or force police officers off the beat, or deprive widows their hot lunches, is simply blowing smoke.
What's going on here is the old interest-group hustle by parent and teacher groups, police and fire unions and advocates for the elderly, all of whom reflexively equate even minor reductions in the growth of spending with "gutting" their programs. It somehow never occurs to them that providing an adequate transportation network may also be a "core" government function, or that failure to provide such a network is costing local governments far more than $60 million each year in lost revenue because of lost economic growth.
Add to this lack of proportionality the hypocrisy of local officials, who want politicians in Richmond to vote to raise taxes and fees to fix the region's transportation gridlock but don't want to be put in the position of having to vote for increases themselves. A profile in courage this is not.
In fact, one of the least-remarked-upon provisions of the transportation package is a section that would repeal the authority for Northern Virginia localities to impose a 1 percent income tax on their residents to fund local services, including transportation. Such a tax would have allowed Northern Virginia to raise $700 million a year in additional tax revenue, just about what the region needs to solve its transportation crisis. But politicians have declined to use that authority -- because, they say, the tax would have to be renewed by voter referendum every five years. Or maybe the real reason is that they didn't have the political courage to propose it, and the political skills to get it passed.
If they were clever, Northern Virginia politicians would ask Kaine to delete that provision when he returns the transportation package to the legislature, and then use the authority to turn the tables on the anti-tax Republicans down in Richmond.
Here's how it would work: First, push through the 1 percent regional income tax. Then, dispatch the Northern Virginia delegation to Richmond with a revolutionary proposal to reduce the statewide income tax by one percentage point. Having preached for decades about the evils of taxation, Republican leaders would be hard-pressed to resist the idea. The net result would be that Northern Virginians would pay no more or no less in income taxes, but would get to keep $700 million of their own money rather than sharing it with those moochers downstate.
It's time for Northern Virginia to acknowledge that it's never going to get a fair shake from Richmond. The best strategy for the region is one of financial secession, a concept that is deeply rooted in Virginia's proud history. In both substance and spirit, the transportation package is a significant step in that direction.
Take the deal.
Steven Pearlstein can be reached at email@example.com.