Va. Road Taxing Authority Rejected
Unelected Body Violates Constitution, Court Says
Saturday, March 1, 2008
The Virginia Supreme Court ruled yesterday that a regional authority created as part of a landmark transportation compromise cannot constitutionally impose taxes and fees, imperiling billions of dollars for road and transit projects and setting up a series of hard choices for legislators and planners.
The court ruled that only an elected body has taxing authority, sending legislators and Gov. Timothy M. Kaine (D) scrambling to change the plan, possibly in a special session of the General Assembly. But all the possible solutions are legally complicated or politically unpalatable, some legislators and legal experts said.
The unanimous decision unravels the state's first transportation funding bill in 21 years, which was passed in 2007 after two years of delicate negotiations. The taxes and fees collected by the Northern Virginia Transportation Authority were intended to raise $300 million a year for projects that include upgrades of the Fairfax County and Prince William County parkways and improvements to roads around Fort Belvoir, which is to receive thousands of new jobs as part of the base realignment program. The money also was to pay for the state's contribution to Metro.
Although anti-tax advocates hailed the ruling, others said it threatened crucial projects needed to stem the region's growing traffic crisis.
"Today's ruling was a severe setback to Northern Virginia," said Chris Zimmerman, an Arlington County Board member and chairman of the Northern Virginia Transportation Authority, which had begun collecting the fees.
Kaine said the ruling creates a "sense of a urgency" to fix the problem. "The message from the court opinion is pretty clear. If we are going to wrestle with transportation infrastructure, the General Assembly members have to go on the board and vote and can't hand that responsibility off to others," the governor said.
In its 23-page ruling, the court said last year's transportation bill violated Virginia's constitution because it delegated the legislature's taxing authority to an unelected body. Although most of the authority's members are elected officials, the board itself was not elected by voters.
"The General Assembly has failed to adhere to the mandates of accountability and transparency that the Constitution requires," wrote Justice S. Bernard Goodwyn, a Kaine appointee. "We conclude that the Constitution . . . clearly contemplates that taxes must be imposed only by a majority of the elected representatives of a legislative body."
The decision also imperils a similar regional authority in Hampton Roads. And although it leaves intact most of the statewide transportation initiatives passed as part of last year's plan, hundreds of millions of dollars in funding destined for Northern Virginia is now "null and void."
Kaine and Republican leaders had hailed the transportation package, which also included the doomed abusive-driving fees, but now must work to try to save it. They said the ruling probably would lead to a special legislative session this spring because there is not enough time to address transportation issues during the General Assembly's regular session, which ends March 8.
Senate Majority Leader Richard L. Saslaw (D-Fairfax) said the court's decision "means we have to redo transportation. It's pretty simple." He added, however: "This was several years in the making, and it is not going to be solved overnight."
House Speaker William J. Howell (R-Stafford), one of the key players in developing the transportation deal, said the issues raised by the court would be addressed. "The point is the Supreme Court has left us a pathway to correct this," Howell said. "I think we can correct it, and I think we will. Obviously, it is a bump in the road, but certainly it is not the end-all, be-all."
Legal experts and legislators outlined several possible fixes but said all are problematic. For example, legislators could impose a statewide tax increase for transportation or one focused on specific regions. But anti-tax activists and some other Republicans strongly objected yesterday and predicted that such a solution would not pass the General Assembly, particularly the House of Delegates, which has resisted any statewide taxes.
Legislators also could revive a provision, included in the bill when it passed the General Assembly last year, that urged local governments to impose the taxes. Local officials objected, causing Kaine to amend the legislation to allow the regional authority to impose the tax. Local leaders probably would object again. In fact, the Loudoun County Board of Supervisors opposed the taxes and fees and instructed its representative to the regional authority to vote against them.
Local officials in Northern Virginia said again yesterday that the state should raise the money. Gerald E. Connolly (D), chairman of the Fairfax County Board of Supervisors and the county's representative on the regional transportation authority, said the ruling should compel the General Assembly to do what many local officials felt it should have done all along: Take direct responsibility for funding transportation.
And Patrick M. McSweeney, a lawyer whose challenge led to yesterday's ruling, said opponents might return to court if the legislature asked local governments to impose the taxes.
Bob Chase, director of the Northern Virginia Transportation Alliance, a business-supported group that lobbies for transportation funding, also called on legislators to revive the imperiled funding. "They have the ability and responsibility to address the Supreme Court's concerns and restore those taxes and fees or a package of equal or greater value," he said.
Anti-tax activists and prominent conservatives who fought the plan in court -- including eight Northern Virginia residents and the Loudoun supervisors -- were pleased at its demise.
"Four words. I told you so," said Del. Robert G. Marshall (R-Prince William), who voted against the legislation, challenged it in court and now is running for the GOP nomination for the U.S. Senate seat being vacated by John W. Warner.
An immediate point of contention is whether and how to refund the $8.2 million in fees and taxes the transportation authority has already collected. Kaine called on the General Assembly to come up with a mechanism for refunds, and Marshall said he would introduce legislation to require it.
"The Northern Virginia Transportation Authority took the initiative to collect these taxes knowing this matter was going to be litigated," McSweeney said. "Why should taxpayers, who never had a voice in this, lose that money through an unconstitutional tax?"
Staff writers Eric M. Weiss and Anita Kumar contributed to this report. Craig and Kumar reported from Richmond.