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Transportation bill clears first hurdle

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RICHMOND—Gov. Bob McDonnell’s version of a transportation funding reform bill cleared its first official hurdle Wednesday, passing relatively unscathed out of the House Finance Committee.

But lawmakers say they’re essentially trying to move a bill out of the House and Senate by today’s deadline, and that the meat of hashing out a compromise—which could look far different from the governor’s proposal—will take place in weeks to come in a conference committee.

The House committee passed McDonnell’s bill—sponsored by House Speaker Bill Howell, R–Stafford—on a bipartisan 14–8 vote.

The Senate still hasn’t voted on its version, but will today.

The House committee’s vote came after a Northern Virginia Democrat warned members that the bill doesn’t provide nearly enough funding to help ease congested Northern Virginia’s needs.

“Addressing the urban crescent’s needs are not only fair play but essential to our economy,” said Del. Vivian Watts, D–Annandale, a former state secretary of transportation.

She said Virginia’s road system needs more than $1 billion in new revenue per year for construction, and if legislators pass a bill that primarily addresses making up a shortfall in the road maintenance budget, the impetus to go further will be lost.

“It is worse than doing nothing,” Watts said.

She had her own proposals for reforming transportation funding, including a sales tax on gasoline. Other Republicans, too, had ideas that differ from the governor’s bill.

Alternative ideas will be considered when the bill eventually goes into a conference committee made up of delegates and senators.

“We know the real work will be done in conference,” said Del. Rich Anderson, R–Prince William, who had proposed amendments that would index the gas tax to inflation and make other tax adjustments.

Howell made a rare appearance before a committee, advocating for McDonnell’s bill.

“This is sort of a moment in time when we have an opportunity” to pass transportation reform that is “far-reaching and bold,” Howell said.

McDonnell’s plan would eliminate the state tax on gasoline, raise the sales tax, and raise registration fees for regular vehicles and alternative-fuel vehicles.

He has been pushing it hard, enlisting endorsements from business and other groups around the state, putting up a website, and commissioning an economic study of its ramifications.

The bill doesn’t address tolls, something McDonnell can pursue without legislative approval. But amendments to the bill Wednesday include language that says McDonnell would back off plans to put tolls on Interstate 95 if the General Assembly passes his transportation bill.

“If we have this new source of revenue, he isn’t going to need those tolls,” Howell said after the committee meeting.

Another amendment would let drivers of diesel-fueled passenger vehicles apply for a tax credit for the amount of gas tax they’d still be paying—McDonnell’s bill keeps the state tax on diesel because it’s primarily paid by commercial truckers.

It also uses some general-fund money, something Democrats dislike.

But one sticking point going forward, particularly between the House and Senate, may be the elimination of the gas tax. Many lawmakers in both parties feel the gas tax is a user fee, and don’t want to abandon it entirely.

McDonnell proposes doing so because the state taxes gas at a flat rate of 17.5 cents, meaning it doesn’t grow with the economy. Better fuel mileage and the growing niche of alternative-fuel vehicles are also cutting into gas tax revenues.

Howell said indexing the gas tax or putting a sales tax on it still doesn’t solve the problem; he feels the gas tax has little future as a viable revenue stream.

“I don’t see the need for a gasoline tax; I think the sales tax is much more preferable,” he said Wednesday.

Opponents of McDonnell’s bill—and some lawmakers still on the fence—argue that the sales tax is paid even by those who don’t drive, and will hit lower-income Virginians while largely exempting out-of-state travelers passing through.

McDonnell’s bill doesn’t please all Republicans; several on the committee, including Del. Mark Cole, R–Spotsylvania, voted against it.

“I was just concerned about the provisions of it,” Cole said afterward. “I’m not sure getting rid of the gas tax is a good idea.”

He said he understands that Howell and McDonnell are trying to craft something to please the more conservative House and more moderate Senate. But he would have liked to have seen a more revenue-neutral bill.

In a statement, McDonnell called the House committee vote a “first positive step forward.”

“This first vote clearly demonstrates a growing, and bipartisan, consensus that transportation is a core function of government and our investments in building and maintaining our highways, transit systems and railroads is of utmost importance to the citizens of Virginia,” McDonnell said.

Chelyen Davis: 540/368-5028