BILLIONS of dollars and plenty of political capital are at stake in Virginia between now and September, when the state legislature will hold a special session devoted to transportation. The big question is how Virginia will raise some $20 billion for highway improvements by 2005. The smaller but more immediate question has to do with how -- or if -- the state should earmark the money for highway maintenance and road construction separately. The early answers seem to depend on what part of the state is being asked. On Monday, a special commission set up by Gov. Baliles to make recommendations for the General Assembly will try to address these issues. Areas such as Northern Virginia and Tidewater, where new roads are critical, are understandably anxious about commingling funds for repairs and for construction.

Gov. Baliles argues that without two funds, maintenance costs could take an increasingly large percentage of any highway-money pot, leaving little for building new roads; under current state law, maintenance gets priority. But a subcommittee of his special commission is recommending a single highway trust fund. House Speaker A. L. Philpott, who is chairman of the subcommittee, contends that a single fund gives the highway department "greater flexibility." But why is that such a good idea? The legislature should and can keep its own options by creating two funds along with procedures for transferring money if needed.

To raise more money, the governor has recommended using revenue from the state gasoline tax, which goes up 1.6 cents a gallon July 1, for maintenance, and bonds, tolls and other sources for construction. Mr. Philpott is not saying how he would set up financing, but he does support adding $400 million for highway construction next year. One proposal considered by his subcommittee is an increase in the state sales tax from 4 percent to 5 percent, which would generate about $400 million.

As for going to bonds, the old pay-as-you-go crowd -- including Mr. Philpott -- is saying no. But if Virginia is serious about new roads -- and certainly the urban areas are -- the bond approach makes sense. It will be up to the governor and the legislative delegations that understand the importance of bonds to make the case in September. The campaign should start right away.