Va. Senate Democrats Looking for Revenue

By Tim Craig and Anita Kumar
Washington Post Staff Writers
Friday, January 11, 2008

RICHMOND, Jan. 10 -- Senate Democrats said Thursday that they might push for a tax or fee increase to raise additional money for transportation, reopening a debate that many thought was resolved when the General Assembly approved a landmark deal last year.

All 21 Senate Democrats stood together to call for additional money for transportation, saying that last year's $1.1 billion compromise did not go far enough.

Democrats want more money to close an estimated $290 million shortfall in that part of the state transportation budget used to repair and maintain roads and bridges. The money could also make up for the elimination of new abusive driver fees, a top priority for Senate Democrats.

Last year's transportation package was hailed as the largest infusion of money for roads and transit in 21 years, but local and state officials now say they are worried the program could unravel. The abusive-driver fees were a key source of revenue in the package, and the fate of regional taxing authorities in Northern Virginia and Hampton Roads is uncertain.

The Democrats did not offer specifics at their news conference, but Senate Majority Leader Richard L. Saslaw (D-Fairfax) said he plans to meet with colleagues in the coming days to discuss possible solutions. Some Democrats are advocating an increase in the state's gasoline tax, but there are divisions in the caucus over how to proceed.

"We are going to talk about a sustainable amount of money to take care of the maintenance fund," Saslaw said. "We are going to get everything taken care of this year."

But many House and Senate Republicans said they will not consider new or higher taxes, and the General Assembly could be headed for a showdown over transportation similar to the one that consumed lawmakers during the past two years.

"No taxes. No way," said Del. M. Kirkland Cox (R-Colonial Heights), the House majority whip.

The volatile tax issue was raised on the second day of the session and a day after Gov. Timothy M. Kaine (D) announced that he wants lawmakers to repeal the controversial fees on bad drivers, which went into effect July 1. The fees, which range from $750 to $3,000, were included in last year's transportation deal as a way to raise as much as $65 million a year for highway maintenance.

Senate Democrats vowed swift action to eliminate the fees.

"It was a huge mistake," Sen. R. Edward Houck (D-Spotsylvania), who supported the fees last year, said of the fees. "I think it was the largest mistake I've made in my 25 years in the legislature."

House Speaker William J. Howell (Stafford), one of the sponsors of the transportation package, and other Republicans agreed that there is probably a majority in both chambers to scrap the fees.

But Howell and GOP leaders want to know how Kaine and Democrats plan to replace the money.

"The governor didn't tell us the whole story yesterday," said Del. David B. Albo (R-Fairfax). "He said he wants to repeal abuser fees, but he left the part out about where he is going to find $65 million."

In testimony before the House Transportation Committee, Transportation Secretary Pierce R. Homer said Kaine is considering ways to come up with the money. But Democrats and state auditors have raised questions recently about whether the fees will bring in the projected revenue, one reason Kaine said he wanted to scrap them.

Regardless of the debate over the fees, Homer said, Virginia needs to find more money to pay for road maintenance. When there is a shortfall in the maintenance fund, he said, money is taken from the highway construction budget, which could eventually delay some projects.

"The issue of how we maintain our existing infrastructure remains unresolved. Period," Homer said in an interview.

Last year, when Kaine and GOP leaders agreed on the $1.1 billion plan, the issue of maintenance was largely unresolved, Democrats said.

"What we did last year is we essentially postponed doomsday by two or three years with respect to road maintenance," Saslaw said.

The cornerstone of the transportation deal is made up of two regional taxing authorities, in Hampton Roads and Northern Virginia. On Tuesday, the state Supreme Court heard arguments in a case brought by anti-tax activists who contend that the regional transportation authorities are unconstitutional.

There is also mounting opposition to the regional authority in Hampton Roads. The Newport News City Council voted Tuesday to back a resolution calling on the General Assembly to abolish the Hampton Roads Transportation Authority, established to raise $200 million a year for projects in that area.

Howell said he is confident the regional authorities won't be rescinded.

Kaine, who considers the transportation deal a key part of his legacy, has vowed to fight to preserve them.

No matter what happens to the authorities, some Democrats want an increase in the state's 17.5-cent-a-gallon gas tax, which has not been raised since 1986. A 1-cent increase would generate about $50 million a year.

Delacey Skinner, a Kaine spokesman, said that the governor is open to considering ways to raise additional revenue but that he most likely won't spend a lot of his time on the effort. In 2006, Kaine proposed a statewide increase in the sales tax on cars, but the House rejected the idea, resulting in last year's compromise package.

"The governor has made has own proposals about how he thinks the maintenance deficit should be handled," Skinner said. "If the General Assembly wanted to take a look at some of those and send a solution to his desk, he would be happy to take a look at it."

Sen. Walter A. Stosch (R-Henrico) said Republicans will stand firm against new or higher taxes.

"Last year, we reached a compromise after three years because people with diametrically different views compromised on transportation," Stosch said. "Reopening this debate is not going to accomplish anything."