Posts about Virginia Legislature

Virginia's smart growth and conservation community expressed concerns with the bill on Saturday.

While Northern Virginia and Hampton Roads will able to raise (tax themselves), keep, and allocate new transportation revenue, VDOT escapes responsibility for meeting the needs of the two most economically important parts of the Commonwealth. The bill frees VDOT to take more of the statewide sales tax revenues for highway construction outside the two regions.

Now that the bill has passed, and presuming the Governor signs it, it will be incumbent upon legislators, local elected officials and the public to watch-dog how the money is spent, starting with the next update of the state's 6-year transportation plan, due in June. Setting the right priorities with the local money from and for Northern Virginia and Hampton Roads will be equally important.

Who voted for and against?

The 25 to 15 vote in the Senate included 17 Democrats and 8 Republicans voting yes, and 3 Democrats and 12 Republicans voting no. Northern Virginia yes votes were Senators George Barker, Charles Colgan Sr., Barbara Favola, Mark Herring, Janett Howell, Dave Marsden, Toddy Puller and Richard Saslaw, all Democrats. No votes were Democratic Senators Adam Ebbin and Chap Peterson, and Republican Senators Richard Black and Jill Holtzman Vogel.

The 60 to 40 vote in the House included 25 Democrats and 35 Republicans voting yes, and 4 Democrats and 36 Republicans voting no. Northern Virginia yes votes were Democratic Delegates Robert Brink, David Bulova, Eileen Filler-Corn, Charniele Herring, Patrick Hope, Mark Keam, Kaye Kory, Robert Krupicka, Alfonso Lopez, Kenneth Plum, James Scott, Mark Sickles, Luke Torian and Vivian Watts; and Republican Delegates David Albo, Mark Dudenhefer, Thomas Greason, James LeMunyon, Joseph May, Randall Minchew, and Thomas Rust.

Northern Virginia no votes came from Democratic Delegate Scott Surovell and Republicans Richard Anderson, Barbara Comstock, Timothy Hugo, Scott Lingamfelter, Robert Marshall, Jackson Miller, and David Ramadan.

The complete bill history can be found here.

Follow the money

The best source for tracking the new taxes and the funding allocations is the HB2313 Transportation Conference Report, but even this requires interpretation.

While the bill no longer eliminates all taxes on gasoline, it still reduces what road users will pay in daily operating costs. It eliminates the 17.5¢ retail gas tax and shifts to a wholesale sales tax on gas. This reduces user fees in 2014 by nearly one-third, and by 20% in 2018 assuming the receipts increase because of a rise in gas prices.

The bill makes up for reducing gas taxes primarily by increasing the sales tax on new car purchases, charging a $100 fee on alternative fuel vehicles like hybrids, and tapping statewide sales taxes on goods and services (but not food).

Day-to-day vehicle user costs will decline, and all taxpayers will pay more even if they drive little or not at all. Meanwhile, transit fares are likely to continue to climb in the absence of adequate state support for transit maintenance and operating costs.

VDOT is free to continue wasting money on unnecessary highway projects

The statewide portion of the bill is truly a highway bill: it directs $538 million (annually by 2018) to the highway maintenance accounts, but this will effectively free up an equal amount in highway construction funds, allowing the current administration to continue a pattern of funding rural highways with little traffic demand.

Just last week, VDOT announced it would allocate another $869 million in federal Garvee bonds to Route 460 and the Coalfields Expressway, two of the most wasteful, unnecessary projects in the history of Virginia. Four questionable projects—Route 460 ($1.4 billion), Coalfields Expressway ($2.8 billion), Charlottesville Bypass ($240 million), and the Outer Beltway in Northern Virginia (estimated $1 billion)—total a potential $5.5 billion in misallocated spending.

Many expect that Secretary Connnaughton intends to divert a substantial portion of the new statewide money to the controversial and sprawl-inducing Outer Beltway, rather than to the critical commuter corridor needs of the metro regions.

Just 21% of the statewide funds go to transit and passenger rail in 2018, although passenger rail advocates are rightly pleased that $44 million in 2014 and $56 million per year by 2018 will go to current Amtrak services for which Virginia is now responsible, and for capital investment in the passenger rail network. An existing funding source supports upgrades for freight rail.

The $84 million for public transit isn't a lot of money when it must be shared among transit agencies across the state. The bill allocates a separate $300 million to Dulles Rail, but like some of the road money it's coming from the existing state sales tax at the expense of General Fund needs like education and health care.

The bill fails to address the empty secondary and urban road capital accounts, unless the administration commits to use some of the freed-up road money in the Transportation Trust Fund for this purpose. Instead, the bill implicitly off-loads the cost of local roads to Northern Virginia and Hampton Roads through the local sales tax increases in those two regions. Shifting this responsibility allows VDOT to spend more money on rural highways.

Part of the future depends on a bill in Congress

Part of the bill also depends on the federal Marketplace Equity Act, a bill in Congress which would let states charge sales tax on Internet purchases. If that does not pass by January 2015, the sales tax on gas will rise another 1.7 percentage points to make up for the expected revenue from the MEA. This would bring gas taxes back to a level comparable to where they are today, if not a little higher at current per-gallon prices.

The Washington Post also reports that Senator Janet Howell (D-Fairfax) secured another provision that would kick in if the MEA does not pass. In that case, the amount of general fund revenue directed to transportation would drop from $200 million a year to $60 million a year.

More taxes rise in NoVa and Hampton Roads

The bill would raise between $300 and $350 million per year in and for Northern Virginia by 2018. It does so by increasing the sales tax in northern Virginia by 0.7 percentage points on top of the statewide 0.3 point increase, for a new total of 6%.

There's also a 0.25% recordation tax on recorded deeds and a 3% transient occupancy (hotel) tax. The bill retains the existing local 2.1% tax on fuel. 70% of the funds will go to "regional" projects and 30% to local projects in the locality where the money is raised. The funds can go to roads or transit, and the Northern Virginia Transportation Authority will decide how to allocate the money.

For Hampton Roads, the bill would raise $219 million in 2018, using a local sales tax increase of 0.7 percentage points and a 2.1% local tax on fuel. However, the legislation directs these funds only for roads, despite the great need for transit and widespread support for light rail in the region.

Following the success of "The Tide" light rail in Norfolk, 62% of voters in Virginia Beach's referendum last November supported extending light rail to the beach. The Navy has also expressed its strong support for extending light rail to Norfolk Naval Station.

In a final example of VDOT off-loading costs onto the two metro regions, the bill failed to allocate state funds to Hampton Roads' Midtown/Downtown Tunnel project which local officials want. Instead, the authors of the bill say that localities should use the new regional funding sources if they want to buy down the costs of the tolls, even as VDOT diverts $1.12 billion of state and federal funds to the unnecessary Route 460 over the objections of many in the region.

Since Governor McDonnell unveiled his plan the day before session began, there have been plenty of twists and turns to the effort to pass the most significant transportation funding boost in the Commonwealth since 1986. Reflecting the deep disagreement over various proposals, the House and Senate each narrowly adopted a major package, with sharp differences between the two versions.

A conference committee met this week and hammered out the proposed deal that now must pass each chamber. The House and Senate could vote on it as early as today.

Where will the money come from?

The primary disagreement between the House and Senate has been over whether to raise revenues through the gas tax and other user fees or to take money from the general fund.

Gas tax: The governor's proposal and the House version of the transportation bill would have eliminated the current 17.5¢ per gallon state gasoline tax, which the Senate voted to raise it and index it for inflation. The conference committee version would eliminate the gas tax, and fill the resulting budget hole (over $4.5 billion in the next five years) by imposing a wholesale tax on gasoline and diesel and increasing the sales tax on vehicle purchases.

Eliminating the gas tax weakens the logical tie between transportation use and funding, and Virginians who use roads less will subsidize those who use the roads more. The compromise does retain elements of a user-pays approach through the wholesale fuels tax and sales tax on vehicle purchases, although it sends a weaker price signal.

A better alternative would have been to increase and/or index the gas tax, or apply the sales tax to gasoline purchases, as the Senate version did. These measures would properly tie fees and taxes to use of public infrastructure and allow revenues to grow with the price of gas. The governor is correct that the gas tax is a declining revenue source, but the main reason it is declining is that it doesn't rise with inflation and hasn't been increased since 1986.

General fund: If much of the proposed funding deal only brings us back to where we are today, where do the additional funds come from? The deal would divert a portion of the existing sales tax, increase the sales tax, and devote possible future online sales tax revenue to transportation.

Sales tax revenues typically go to the general fund. Although transportation is a core function of government, there are few or no other state dedicated revenue sources for education, health care, public safety, and conservation. The deal would divert an estimated $3 billion over the next 5 years that could have gone to other core services, at a time when Virginia ranks 35th in state investment in higher education, 38th in public K-12, and 46th in Medicaid spending.

Clean vehicle fees: The compromise also would impose a $100 fee on alternative fuel vehicles, as the governor had proposed. This "hybrid car tax" is particularly hard to justify when gas taxes are being cut, and it would create a disincentive for purchasing vehicles that help achieve critical goals such as reducing pollution and conserving energy.

Regional funding: The proposed deal also includes regional funding packages of approximately $300-350 million annually for Northern Virginia and $175-200 million annually for Hampton Roads. Funding is likely to come through local sales tax revenues but many details remain unclear.

Where will the money go?

Amid all the debate, a central issue has largely been ignored: how will the state spend these additional funds?

Highway construction: The General Assembly authorized almost $4 billion in additional transportation funds just 2 years ago. The administration has earmarked almost all of these funds for roads, and has spent much of the money on destructive projects that do not address pressing transportation needs.

In the proposed deal, although there is some good news for rail and transit, most of the funding again will go to road-building—at least $2.6 billion over the next 5 years alone. The ultimate impact of this deal depends on how wisely this money is spent.

Passenger rail funding: Passenger rail is a transportation success story, with record ridership last year. Without dedicated, sustainable funding, however, Virginia could lose its intercity services due to federal funding changes. A bright spot of the proposed deal is that it would provide roughly $50 million annually to preserve and expand passenger rail.

Transit funding and Dulles Rail: The deal would provide additional funding to transit as well. In addition, $300 million would go to Phase 2 of the Dulles Metrorail (Silver Line) project, which would help address the relatively small contribution Virginia has made to a project that could significantly enhance multimodal transportation in one of the nation's leading economic and employment corridors.

However, going forward, it appears transit will only receive about 1/6 of the funding devoted to roads, despite transit's benefits in reducing congestion, energy consumption, and pollution while providing better services for elderly, disabled, and low-income citizens.

The compromise before the General Assembly offers some meaningful benefits, but it has numerous shortcomings and does nothing to advance overdue policy reforms to help ensure that our transportation dollars are used wisely.

Virginia needs a more balanced, efficient, and cleaner transportation system. Time will tell how far this deal gets us.

Without critical amendments, the bill that ultimately emerges from the conference committee is unlikely to be a good deal for Northern Virginia or other metropolitan areas of the state. The McDonnell administration has squandered much of the $3 billion in borrowed funds the legislature authorized in 2011. The governor spent it on highway projects in rural areas, while neglecting funding for Dulles Rail, Tysons Corner, and Hampton Roads' top priorities—their bridge-tunnel crossings.

Prominent among the McDonnell Administration's wasteful projects have been Route 460, the Coalfields Expressway, Charlottesville Bypass and the Outer Beltway. If Virginia continues to pursue these projects it could waste a combined $5.5 billion, but if the legislature makes review and reevaluation of these projects a condition of new funding, there's still a chance to redeploy the funds to real transportation needs.

Eliminating all taxes on gasoline, the centerpiece of McDonnell's bill, could make traffic in our metro areas worse, reducing transit use and increasing driving. It cuts the sensible tie between transportation use and funding, forcing Virginians who drive less to subsidize those who drive more, hurting seniors and low-income people, carpoolers, transit users, those who live closer to their jobs.

Switching to the sales tax could also make Northern Virginia and Hampton Roads further subsidize long-distance driving throughout the state. It would also divert state general funds essential for education, health care, public safety and conservation.

Without amendments to ensure the Virginia Department of Transportation sets better priorities, there is no guarantee in these bills to meet the needs of the metro areas or the state's growing transit needs. There is no guarantee these bills will restore funding for local roads; for the past 2 years, VDOT has zeroed out funding for secondary roads in localities despite record transportation spending.

Fortunately, nearly all of the Democrats and a number of Republicans believe that eliminating all taxes on gasoline is a bad idea. Opposition to the idea also extends from the smart growth community to the Wall Street Journal.

On January 15, a Wall Street Journal editorial argued that McDonnell's scheme "violates the user-pays principle" of sound public finance:

[It] would mean that a Virginia resident who may not even own a car has to pay more for road repairs when he buys a cell phone, computer or Big Mac. Motorists who benefit most from the roads would pay almost nothing directly to use them... [F]unding transportation through a sales tax "makes roads free," at least in terms of direct payments, and thus will lead to more driving and more gridlock—the opposite of what McDonnell says he wants to achieve.

Let's hope the legislature rejects the Governor's proposal to eliminate the gas tax. We hope the legislature will vote for the following amendments:

• Include mandatory reevaluation of VDOT's megaprojects. We could save much of the $5.5 billion to use to address our real transportation needs.
  
• Reform the Public Private Transportation Act to ensure greater public oversight.
  
• Keep the gas tax. It is an appropriate user fee tying payments to use of Virginia's roads, and it ensures out of state drivers also contribute. Apply the sales tax to gas at the wholesale level and/or index the gas tax to inflation.
  
• Withdraw any increase in the statewide sales tax. A statewide increase will mean the state (VDOT) will just siphon the money from Northern Virginia and Hampton Roads.
  
• Allow a local sales tax for transportation in Northern Virginia that Northern Virginia controls and the same for Hampton Roads. Let our two most congested regions decide what to fix and build.
  
• Require 25% of the new funding to go to transit, both urban and rural.
  
• Require 15% of the new funding to go to local roads. VDOT has zeroed out money for local roads in order to build unnecessary highways in lightly trafficked areas. If we don't specify this, then we still won't get local street funds including pedestrian and bicycle facilities.
  
• Keep the $15 vehicle registration fee for intercity passenger rail and public transit funding.

Without these amendments, the legislature should reject the Governor's bills and new funding for the state transportation agencies.

Here's a more detailed breakdown of where we find nearly $5.5 billion in waste:

• Route 460: This $1.4 billion proposed new highway between Suffolk and Petersburg costs over $1.1 billion of taxpayer funds, plus tolls. The current Route 460 carries just 11,000 trips per day.
  
• Coalfields Expressway: A $2.8 billion new highway is in the least-trafficked area of the state.
  
• Charlottesville Bypass: This $243 million project doesn't solve congestion and saves minimal travel time for commuters.
  
• North-South Corridor: This estimated $1 billion piece of an Outer Beltway around DC doesn't address commuter needs and would add development and traffic in areas without infrastructure.

Any transportation plan, the House Democrats say, should:

1. Generate at least $1 billion in new money per year.
   
2. Rely on a realistic, dependable source of revenue, based on Virginia's actions, not potential federal changes that may or may not happen.
   
3. Not transfer monies that otherwise fund schools, health care, and public safety.
   
4. Fund not just maintenance, but construction, including rail and transit.
   
5. Provide additional revenue both immediately and into the future.
   
6. Give authority to Northern Virginia and Hampton Roads to raise additional funds for their own transportation needs.

These are solid principles, and they offer a stark contrast to McDonnell's plan. The governor's proposal would raise far less, and relies on money from the general fund, as well as from a federal Internet sales tax that has not passed Congress.

The 9 specific bills that Democrats cited as true to those core principles are HB1677, HB1878, HB2063, HB2179, HB2253, HB2333, HB1450, HB1472, and HB1633. The House could pick one of those 9 to push, or it could try to amend one of them to combine the best provisions from all.

Republicans control the Virginia House, and the Senate is evenly split, so any plan will need GOP support to pass.

Although it's true that some questionable highway projects would surely be built if Virginia ultimately adopts this transportation funding plan, this also offers far more support for transit and urban needs than the governor's proposal, and it doesn't include as many harmful, regressive policies. This is a far more reasonable outline.

Cross-posted at BeyondDC.

The Coalition for Smarter Growth, the most influential smart growth group in the Washington region, organized a panel with Chris Leinberger of Brookings, David Bowers from Enterprise Community Partners, and the DC Fiscal Policy Institute's Ed Lazere. It's Tuesday, January 22, 6:30-8:30 (with some refreshments beginning at 6) at NCPC, 401 9th St NW, suite 500 North. RSVP here.

Talk pedestrians in upcounty: After a spate of pedestrian injuries and deaths in upcounty Montgomery, the Action Committee for Transit put together a forum on pedestrian safety at the Germantown Public Library, 2-4 pm on Saturday, January 26. Barbara McCann from the National Complete Streets Coalition will talk about the area's pedestrian safety problems and possible solutions.

Support biking in DC, Maryland: WABA is inviting folks to its offices on Wednesday, January 23 to talk about bicycle planning in DC and Maryland. The MoveDC initiative and a transportation planning process in Maryland will be collecting a lot of public input.

Stop by WABA's offices in Adams Morgan, 2599 Ontario Road NW, between 5:30 and 9:30 to talk with WABA staff and fellow cycling advocates about how to best weigh in during these processes and what to say when you do.

Support biking in Virginia: In the Commonwealth, the biggest bicycling issues are in the state legislature, where advocates are pushing for 6 specific bills that will make roads safer for cyclists. They are organizing a Bicycling Action Day in Richmond on Tuesday, January 29, starting at 10:30 at the "compass" plaza at Virginia Commonwealth University, followed by a bicycle ride to the state capitol for a rally.

Zoning update! And don't forget the Ward 4 zoning update information session, 6:30 tonight (again, Wednesday—sorry daily email readers) at Takoma Education Campus.

"Dooring" bill isn't quirky, it's essential

Senator "Chap" Petersen (D-Fairfax) has introduced a "dooring" bill to make Virginia law match Maryland, DC and many other states. In those places, it's a driver's or car passenger's responsibility to make sure when they open a door, it's not right in the path of a cyclist or other "moving traffic" (but really, it's cyclists). In Virginia, there's no requirement to be careful when opening a door, which means that if someone doors a cyclist, police can cite the cyclist for hitting the door instead.

Unfortunately, a Post article on "quirky proposals" in the legislative session highlights this one, even in the first paragraph. Reporter Errin Haines mentions this bill in more detail shortly after quoting Speaker William Howell talking about how he keeps a file of "the stupidest bills."

It's perhaps understandable that one might not immediately know the reason for the bill by reading the legislative summary, but this is actually an important issue that the legislature needs to take seriously.

If Route 1 has to be too wide, leave room for cyclists, too

WABA is also asking Virginians to submit comments on the Route 1 widening in southern Fairfax. Alex Eidson explained many of the problems with the proposal from an urban design standpoint, but as long as they're going ahead, the new road could at least safely accommodate bicyclists.

As Allen Muchnick explains, the original EIS for the road, which is basically the only way to bike through the Fort Belvoir area, had 15-foot curb lanes, enough for cars and bikes to share the space side by side. However, the Federal Highway Administration reduced this to only 14 feet.

Bike advocates would like to restore 15 feet, and stripe the lane as a 10-foot regular lane and a 5-foot bike lane. You can send comments using this WABA form.