Major Tax Hike Not on Kaine's Agenda

Campaign Vow on Mind as Focus Turns to Health Care, Education, Environment

RICHMOND, April 5 -- With the fight over transportation money now behind him, Virginia Gov. Timothy M. Kaine said Thursday that he will not seek a major statewide tax increase during the remainder of his term.

Kaine (D) said in an interview that he plans to try to increase health-care access, improve public education and launch several environmental initiatives during his last 2 1/2 years as governor.

But Kaine, trying to fulfill a campaign promise and bow to the political realities of dealing with a Republican-controlled General Assembly, said he won't be asking taxpayers to pay more to accomplish those goals.

"You are not going to see me seeking significant upward adjustments in taxes during the remainder of my term," Kaine said. "I am going to have to rigorously prioritize."

Kaine reflected on the conclusion of the 2007 legislative session, in which lawmakers approved a $1.1 billion-a-year plan to ease traffic congestion and expand mass transit.

The governor initially pushed for a statewide tax increase to pay for the plan, but conservative Republicans objected. Instead, he and GOP leaders agreed on a compromise that relies on regional tax districts in Northern Virginia and Hampton Roads, the borrowing of $3 billion over 10 years, and higher vehicle-registration fees and fines on bad drivers.

Kaine said he is satisfied that the new money, a significant portion of which will go toward mass transit, will meet the state's short-term transportation needs. He now plans to focus on other campaign promises, including making pre-kindergarten available to every 4-year-old.

Over the next year, the governor said, he will also start working on ways to "invest more" in public schools so more students can achieve excellence.

He is also awaiting findings of a commission he established to look for ways to give uninsured residents better access to health care.

The projects will come at a price, including $300 million a year for the pre-kindergarten initiative. But Kaine said he will look for other savings to pay for his priorities.

"I would love more revenue in the abstract, but I made a commitment when I ran for governor," Kaine said.

Republicans say they will hold Kaine to his promise but won't be surprised if he changes his mind.

"We will see if he sticks to it," said Sen. Ken Cuccinelli II (R-Fairfax).

"He wouldn't get a tax increase out of a Republican General Assembly, anyway," he added.

Many Democratic and Republican governors across the country are discovering that it is difficult to address health and education issues without searching for more revenue.

Pennsylvania Gov. Edward G. Rendell (D), for example, is pushing a 1-cent increase in the state sales tax and a 10-cent increase in the cigarette tax to improve access to health care for the uninsured. In California, Gov. Arnold Schwarzenegger (R) is proposing an increase in what he calls "fees" to fund his $12 billion plan to provide health insurance to all residents.

Virginia officials say that by ruling out tax increases, Kaine won't have the money to propose anything nearly that ambitious. Even though state revenue has been growing by as much as 10 percent annually, much of the extra money is already earmarked for other programs.

"He will have the money he needs to meet the core services of state government, but in terms of dollars for new initiatives, I think transportation prevailed, so other big, new initiatives will have to take a back seat," said Robert P. Vaughn, staff director for the Republican-controlled House Appropriations Committee.