• Oregon Shows Mileage Tax Can Work

    The Oregon Department of Transportation has declared its test of the mileage-based tax a success. The Beaver State instituted the pilot project out of concern that increasing purchases of hybrid cars and non-gasoline powered vehicles would undermine the integrity of the gasoline tax. The test was designed to determine if it was practical to administer a program that taxed motorists on the basis of the number of miles they drove, rather than the volume of gasoline they purchased.

    Oregon’s system relies upon a device inside the car to read the odometer and transmit it, along with a vehicle identification number, by wireless technology to the gas pump. The tax is calculated and added to the price paid at the pump. After that point, tax collection is the same as it is for the gasoline tax. Privacy advocates please note: The system cannot track your car when you slip off to see your girlfriend. States the report: The concept requires no transmission of
    vehicle travel locations, either in ‘real time’ or of travel history.”

    Key findings of the “Oregonโ€™s Mileage Fee Concept and Road User Fee Pilot Program” report include:

    • A mileage fee can be implemented to replace the gas tax as the principal revenue source for road funding.
    • The mileage fee can be paid at the pump, making it almost indistinguishable from the motorist’s perspective, from how they pay the tax now.
    • The mileage fee can be phased in gradually alongside the gas tax, allowing non-equipped vehicles to continue paying the gas tax — and allowing the state to capture revenue from out-of-state drivers.
    • The system is compatible with congestion pricing. Different pricing zones can be established electronically, the fees charged, and the revenues collected when drivers fill up at the pump.
    • Many levels of privacy protection can be implemented.
    • Potential for evasion is minimal. Tampering with the on-vehicle device would result in default payment of the gas tax.
    • Cost of implementation and administration is low.

    To my knowledge, no one in Virginia is giving serious consideration to the mileage-based tax. But we should. The gasoline tax is living on borrowed time here, just as it is in Oregon. We need to start thinking about the future now.

    I have advocated taxing motorists on the basis of the number of miles they drive, adjusted for the weight of the vehicle — heavier vehicles cause more wear and tear on roads, therefore they should pay more — and the amount of pollution they emit. Under my user-pays system, all monies from the Mileage Tax would be used for one purpose only: to fund road maintenance. The tax would be adjusted up or down as the cost of road maintenance rises or declines. (I have advocated other mechanisms for funding construction of new roads, which I will elaborate upon if anyone is interested.)

    (Hat tip to Jonathan Mallard for pointing me to the Oregon study.)


  • Tax Credit Crisis

    Gov. Timothy M. Kaine may want to increase the amount of land under conservation easement, but his Department of Taxation isn’t making the job any easier for him.

    In April, the tax department sent letters to investors who purchased land conservation tax credits from the Silver Cos., informing them that they could not take the credits. The credits are linked to the Silver Cos.’ Celebrate Virginia project, which set up conservation easements on more than 400 acres along the Rappahannock River. The Silver Cos. qualified for $28 million in credits and sold them at a discount — 50 cents on the dollar — which proved attractive to a lot of investors. The Department gave no explanation for its action.

    Now, reports the Free Lance-Star, Craig Bell, a McGuireWoods attorney who represents 341 investors, has filed a formal protest with the Virginia Department of Taxation. There is no legitimate reason for denying the credits, he says.

    Someone had better get this straightened out. If I were an investor, I sure wouldn’t invest in conservation easement tax credits — from the Silver Cos. or anyone else — if I thought there were any chance that the Department of Taxation wouldn’t recognize them. Before this is all over, someone is going to look really bad — either the Silver Cos. for selling credits they shouldn’t have, or the Department of Taxation for throwing the tax credit program into turmoil.


  • New Candidate for State Song

    Gov. Timothy M. Kaine has really stepped in it this time. He’s ripped the scab off the old state song controversy. If he had his way, said the Governor, who played the harmonica while a bluegrass band performed the tune at a campaign stop in 2005, Virginia would adopt the old bluegrass gospel anthem, “Will the Circle Be Unbroken.”

    “I’m sure my popularity will plummet even further after having waded into that,” he said, as reported by the Washington Times.

    If the legislature adopted a proviso that the official version of “Circle” was the one recorded by the Nitty Gritty Dirt Band, I just might go along.


  • Candidate Saxman

    Del. Chris Saxman has generated a substantial online buzz regarding his Senate candidacy.

    And I’d say that candidacy is all but certain. No, it’s not just the hospitality suite at the Republican “Advance” this weekend. Nor is it merely his speaking slot on the official program.

    My certainty comes from the answers he gave to questions I posed to him in an interview for a forthcoming Bacon’s Rebellion ezine column. When he announces his candidacy, he will likely have the backing of some “conservative members of the House of Delegates,” whose names will be announced when he launches the campaign. Who is on the list will be interesting, indeed.

    But even more so will be the issues on Which Saxman will run:

    I will focus on the issues that the citizens of the Commonwealth want me to focus on. For far too long, politicians have gone around telling people what the politicians want to do. I think it is time for the pollsters, consultants to stand down for awhile and let the candidates listen to the people. Then, the eventual winner will be able to represent the people of Virginia TO the federal government instead of representing the federal government to the people. It is an important but necessary distinction. Unless you sit down at the kitchen tables of Virginia and really discuss the issues that impact people on a daily basis, you will always be distant from the reality of their lives. We need politicians to listen for a change so that a change can be made.

    It’s an admirable approach. It’s also one that, if memory serves, Jim Webb used during his Senate campaign.

    There’s one other thing Saxman says he will do that I find very interesting:

    I will honor the spirit of Virginia law and not raise money during the legislative session. I think it is important to uphold that law. That is a tactical disadvantage clearly but I think people want a new day or new direction for the Commonwealth and that will mean campaigning in an entirely different way.

    This is, indeed, a novel way of campaigning. It’s risky, to be sure, because Jim Gilmore will be raising money throughout the time the legislature is in session. But another thing we learned from the Allen/Webb race is that money doesn’t matter as much IF one has a steady flow of positive free media. And in taking the approach that he will be addressing the people’s business before his political ambition, Saxman might just be able to diminish the horse race aspect of the contest.

    Of course, Chris could still say he’s not running. But given what he’s told me, I think his candidacy is all but certain. And if so, then Virginia Republicans will have a legitimate and compelling alternative at their nominating convention.


  • Campbell County’s Collision with Reality

    Campbell County board supervisors appear to be a step ahead of their peers in other municipalities when it comes to confronting the implications of the Comprehensive Transportation Funding and Reform act of 2007. (Either that or the Lynchburg News & Advance is a step ahead in its local government coverage.) Quoth the newspaper:

    Paying for maintenance of new roads in rural counties could get tricky in the years ahead. More than that, it could get expensive because the localities would have to maintain some of their new roads, a service now covered by the state.

    How about that: Road maintenance is expensive. That lesson is sinking in now that localities can’t undertake any land use decision they want and fob off the road-maintenance consequences to the state any longer.

    One of the more important changes in state regulations is a requirement for new subdivisions to have at least two connections to state roads. That would discourage “unconnected residential development,” explains the newspaper. This point requires a bit of elaboration. In the “pod” form of development that is pervasive across Virginia, many subdivisions have only one outlet to state roads. When subdivisions don’t connect with one another, there are fewer alternate routes for people to get places. The result is that all traffic funnels into a finite number of roads, the roads get crowded, and people howl for more state money to build more roads.

    Supervisors aren’t happy about the regulation. They’re thinking of writing Secretary of Transportation Pierce Homer. โ€œIf the roads that are needed to serve a high-density subdivision are not advantageous to other roads connecting in that area, says Concord District Supervisor Eddie Gunter., “theyโ€™re saying it will be up to the county and developers to take care of that.โ€

    And your point is….?

    But that’s not all that has Gunter disgruntled. โ€œRoad costs and road maintenance are very expensive,” he says. “If the county has to take over maintaining roads, that means we would have to set up a department like a mini-VDOT. There are a lot of counties in the state that could not do this.โ€

    Yes, Mr. Gunter, road maintenance is expensive. Maybe you need to take that into consideration next time Campbell County updates its master plan. But, no, you don’t have to set up your own mini-VDOT. Perhaps Mr. Homer will share with you what he’s learning about “outsourcing” — something that VDOT is doing a lot more of these days.


  • Is Europe a Country?

    When E M Risse frets about Americans’ geographic illiteracy, he’s worried about their inability to comprehend some fairly complex relationships at the intersection of economics, society and physical space. If Americans are stumped over brain teasers such as, “What country is Budapest the capital of” — or worse, “Is Europe a country” — it may be a while before they grasp the fundamentals of human settlement patterns.

    This clip from “Are You As Smart As a Fifth Grader” is a case in point. Kelly Pickler, of American Idol fame, can belt out a country song, and she deserves credit for overcoming a difficult childhood. She’s also as cute as a button — if I were 20 years old, I’d probably have a crush on her. But she’s the living embodiment here of the blonde bimbo, and testimony to geographic illiteracy.

    Pickler’s ignorance of the most elementary geography is an indictment of her schooling in New London, N.C., not far from Charlotte. How can Americans hope to compete in a global economy if they’ve never heard of Hungary, or if they guess that Budapest might be a city in France… or would that be Europe? Let us hope Virginia schools do better.


  • The Nov. 6 Growth Backlash

    It may be the biggest story of Election 2007 in Virginia — certainly as significant as the Democratic Party seizing control of the state Senate by one seat — and it’s three weeks old now, but the Mainstream Media hasn’t gotten around to reporting it yet. On Nov. 6, Virginia voters across Virginia repudiated Business As Usual politics at the local level.

    Oh, sure, individual newspapers took note on a case-by-case basis of how the voters threw the bums out, and in a handful of counties, such as Loudoun where the connection was so glaring that even Helen Keller could have seen it, reporters even noted the discontent with the pro-growth incumbents. But no one, to my knowledge, saw the big picture. No one explored the implicatioins of voters installing anti-growth supervisors in power in a dozen localities.

    As Peter Galuszka reports in “Growth Backlash,” smart growth advocates are jubilant. But Peter peers beyond the election results to discern what challenges the new supervisors face.

    Ironically, the smart growth movement has come to power just as growth is running out of steam. The sub-prime mortgage fiasco and the collapse of housing prices is leading to project cancellations around the state. Suddenly, there is a huge backlog of houses — in Loudoun County, supposedly enough to last eight years. The downturn could be aggravated by any one of a host of factors, from rising gasoline prices to the devaluing dollar. Northern Virginia faces unique challenges of its own: the defense/homeland security gravy train may run off the tracks. After years of double-digit growth, spending could well plateau or, if the Democrats win the presidency next year, decline.

    Indeed, the economic situation looks so dire that the home builder associations may start pleading poverty and lobby for clawbacks, such as a rollback of proffers.

    Peter explores one other issue. It’s not clear to what extent many of the new supervisors should be described as “smart growth” or just “anti growth.” How many of them truly embrace smart-growth principles such as compact development, higher densities, bicycle lanes, pedestrian-friendly streetscapes, and mass transit? Board chairman Corey Stewart in Prince William County seems devoted to preserving the autocentric society, slapping moratoriums on new housing starts while catching up on road building. Transit Oriented Development is not part of the plan.

    However the local politics shake out, the growth debate will look very different in the next two years.


  • Dominion Solicits Renewable Energy Proposals

    First it’s nukes, now it’s renewable fuels. The boys and girls at Dominion have been very busy this week. The Richmond-based power company has announced today that it is soliciting proposals for renewable energy projects as part of its commitment to meet goals established by Virginia and North Carolina.

    Dominion has issued a Request for Proposals for projects that will generate electricity using wind, sunlight, falling water, sustainable biomass, waste, wave motion, tides or geothermal energy. The projects must be located in Virginia, North Carolina or elsewhere in the PJM Interconnection area, which would allow the electricity to be transported to Virginia and North Carolina, the company stated in a press release. Dominion is interested in project ownership interests or purchase of renewable energy credits.

    Gov. Timothy M. Kaine put in a plug for the power company: “I applaud Dominion for taking this step toward meeting the renewable energy goals we have set for Virginia. As we strive to meet the growing energy needs of the Commonwealth in a sustainable, environmentally responsible way, this kind of leadership from our private-sector partners is crucial.”

    You have to give people at Dominion credit. They’re paying attention. This is what people want to hear.

    Here’s my question: While it’s great that Dominion is soliciting ideas from the outside, what is it doing internally? Why doesn’t Dominion have its own renewable energy group (or does it)? Who’s better equipped to know what kind of energy it needs where to optimize its transmission and distribution system? … Or would the cynics just criticize the company for crowding out the competition?


  • Now It Makes the Paper

    Thanks to Jim’s update on my post yesterday about Stuart Siegel’s land clearing along the James, I now see that the RTD has gotten off the dime and run its own story on the matter. So who will pay for Stuart’s actions? The Science Museum Foundation, which owns the land:

    Art Dahlberg, the city’s building commissioner, said the museum foundation violated that law when it recently allowed some clearing within the buffer.

    The city will require new plantings to replace the vegetation.

    “We would gladly do that,” said Julia M. Carr, executive director of the foundation. “We intend to meet our obligation if we have violated any acts.”

    Carr said she wasn’t aware of the buffer requirement. “We are really concerned about the environment. . . . We were just remiss in this area, it appears.”

    The foundation yesterday sent an e-mail to its board members alerting them to expected news coverage about the violation.

    Carr said the land was cleared by workers hired by Stuart Siegel, chairman of S&K Famous Brands. His house sits just above the cleared area.

    “We were just remiss in this area, it appears.” Yup. But Ms. Carr wasn’t alone. It seems that very few people are aware this statute exists. One thing is certain, however: the SMVF now knows about the law. So does Stuart Siegel. And guess what? So, too, do the editors of the RTD.

    Now if they would only stop penning mash notes to the river, everyone would be a winner.


  • Prince William Hits Dead End on Transportation

    Prince William County cannot afford to build the roads that voters approved in a $300 million bond referendum because declining real estate values have clobbered the county’s borrowing capacity, reports Dan Genz with Examiner.com. โ€œThe public clearly wants these roads, and we donโ€™t have a way to pay for them,โ€ laments County Vice Chairman Martin Nohe said. โ€œIt worries me greatly.โ€

    The county has scrapped improvements along Prince William Parkway and Route 28, as well as the next package of road-building proposals scheduled for 2010, which included the widening of Rt. 1.

    The problem is that debt capacity is linked to revenue. County officials anticipated declines in property values of two percent and four percent for this fiscal year and next. Instead, property values tumbled 4.7 percent and 14 percent, producing a $51 million deficit next year. Revenues from the recordation tax and the sales tax also have declined, Genz writes.

    County officials may be misrepresenting the situation somewhat (either that, or Genz is mis-reporting the situation). If I understand municipal bond financing correctly, Prince William could borrow more money — but its bonds would be downgraded from its current AAA rating. Presumably, PWC doesn’t want to start down the slippery slope of excessive debt and deteriorating bond quality — a commendable sentiment — but that’s not the same as saying it can’t borrow more.

    The larger and more important lesson is this: PWC is bumping into the limits of what local governments can do to build their way out of congestion. The PWC board of supervisors is dedicated to preserving current inefficient human settlement patterns (scattered, low-density, disconnected), but it’s running out of options. At some point, supervisors will have to contemplate the horrors of higher densities, more contiguous development, more mixed uses, more pedestrian/bicycle friendly streetscapes and, horror of horrors, mass transit.

    Of course, that’s pretty much what Sharon Pandak called for in her unsuccessful run against Corey Stewart for BOS chair, and the voters chose Stewart. The citizens of PWC appear to be in no mood to deal with reality. It’s easier to blame the VDOT, the state, the illegal immigrants — anyone else.


  • Nyah, Nyah! Our Illegal Immigrants Are Smarter Than Yours!

    Illegal immigrants in the Mid-Atlantic states (Maryland and Virginia) are different from illegals in other states — they tend to be better educated, they make more money, and they’re less likely to have slipped across the border illegally, maintains the Center for Immigration Studies. Summarizes the Washington Post:

    The average household income for illegal immigrants is $45,748 nationally. In Maryland, it’s $58,061; in Virginia, $61,112. The findings may reflect the greater overall wealth of the two states: The average household income for native residents is $83,964 in Maryland and $79,524 in Virginia, compared with $66,952 nationwide.

    The study suggests that a greater share of illegal immigrants in the Washington region are people who overstayed their entry visas rather than sneaked across the border, says Steven A. Camarota, who wrote the report. “People who overstay are more likely to be foreign students and guest workers who are more educated. People who cross the border illegally tend to be the least educated.”

    That conforms with my personal experience. Some of the immigrants that I know personally entered the country legally, overstayed their visas illegally and melted into the population. Some have since obtained green cards. One married a U.S. citizen, thus becoming a U.S. citizen herself. Of course, the individuals I know best are of Brazilian or Caribbean origin. It’s difficult to “sneak across the border” when you arrive by airplane.

    You can view the study here.


  • Dominion Files to Build Third Nuke

    It’s official: Dominion has filed a permit with the U.S. Nuclear Regulatory Commission to build a new power plant at its North Anna complex.

    Playing the Global Warming card, the power company described the new nuclear power generator as “carbon free,” avoiding the emission of 7.4 million tons of greenhouse gases, equivalent to 1.5 million cars.

    Dominion could not say how much the power plant will cost because it is still negotiating with vendors. But the Richmond-based power company should enjoy considerable leverage: It is the first power company to apply for a permit using the new Economic Simplified Boiling Water Reactor technology, and North Anna Three could become the reference site for the entire industry. General Electric-Hitachi, which developed the technology, presumably is highly motivated to see the plant built.

    Safety is sure to be a major issue with regulators and the public. The new design is simpler and dramatically safer than older designs, asserts David Christian, Dominion’s chief nuclear officer. Using passive, gravity-based systems requiring 25 percent fewer pumps, motors and valves, the GE-Hitachi design should translate into lower up-front capital costs and operating costs as well. The estimated life span of the nuclear unit is 60 years.

    One feature designed to appease environmentalists is the introduction of a closed-loop cooling system that will eliminate the need to discharge any additional heated water into Lake Anna. However, Dominion did not address the issue of how spent nuclear fuel rods would be stored or reprocessed, nor did any of the journalists attending today’s press conference think to ask. (Bacon’s Rebellion tapped in via a live webcast.)

    If the new unit meets regulatory approval and Dominion proceeds with construction, it could generate 1,520 megawatts of electricity — enough to power one million new homes — by 2015. that compares to the estimated 4,000 megawatts that demand is expected to increase over the next decade.

    It’s hard to see how alternative fuel sources — solar, wind, biomass — could hope to meet Virginia’s soaring electricity demand within the next eight years, even if the modest conservation initiatives under review are ever implemented. The alternatives are to build another coal-fired power plant, which unquestionably would pollute more, or build high-voltage electric lines to wheel in more power from ouside the state. But, as President Thomas F. Farrell II observed, “Virginia already imports more power from outside its borders than any other state but California.”

    If Virginia is going to consume massive amounts of energy, we might as well reap the benefits of producing it — as long as safety and environmental safeguards can be assured. The power plant will add millions of dollars in revenue to the local tax base and create another 750 permanent, high-paying jobs in central Virginia. Dominion’s role in pioneering the new technology also should add luster to Virginia’s emerging role as a major player in the nuclear power industry. (See “AREVA Ponders Massive Investment in Lynchburg.”)

    (North Anna Three rendering credit: Dominion)


  • Two Americas: The World that Works, the World that Doesn’t

    Using Fed-Ex shipping and ATM machines as examples, Newt Gingrich contrasts “the world that works” with the “world that fails.” This 3:20 minute clip is worth watching. Don’t get sidetracked on his specific example — the federal government’s inability to track down illegal immigrants — of the world that fails. This video is not about illegal immigration. Gingrich is making the larger point that, for all its massive power and resources, government just can’t do many things well.

    What are some of the other things that we shouldn’t trust government with? I’d start with education. Government needs to ensure that every American gets an education. But why does government have to be in the business of running schools? Government ensures that people get food to eat by providing food stamps, a form of voucher — not running the grocery stores. Why not use vouchers to ensure that people have sufficient buying power to educate their children?


  • Rail to Dulles: The Lawsuits Begin

    A citizen’s group is suing two federal agencies, alleging they failed to ensure competitive bidding for the $2.5 billion project extension of Metro heavy rail to Tysons Corner without adequately considering a tunnel as a “reasonable alternative” to running the track above ground, reports the Associated Press.

    The lawsuit, filed by members of TysonsTunnel.org, a group of community associations, small businesses and environmentalists, seeks an injunction halting federal funding of the project until a competitive bidding process and a comprehensive tunnel review are conducted.

    This is not a good omen: Construction work has not even begun, and a lawsuit has been filed. I get more pessimistic about the prospects of this project with each passing week. Rail-to-Dulles is so big, so complex, and so dependent upon arbitrary wealth transfers for financing that it exceeds the capacity of the political system to process it. Tysons Corner needs to be part of the Washington heavy rail system, but not in the way that has been contrived. Our best hope now is for the project to collapse under its own weight so we can start over. Otherwise, it is destined to turn into Virginia’s answer to Boston’s Big Dig.


  • Can’t See the River for the Trees

    The RTD’s editorial page waxes rhapsodic over Richmond’s master plan and its vision the critical role the James River might play in future development. But the James is more than a role player. It is also a ready metaphor, one the RTD’s editorial writer bathes in with weird glee:

    Although the James claims a sacred spot in Richmond’s story, for too long the river has divided the city and its environs. The master plan sees the river as a unifier. Yes, we’ll gather at the river, the beautiful, the beautiful river.

    At least the writer avoided the obvious “a river runs through it” treacle. But I’m sure that was a close run thing.

    But for all the paper’s great interest in the James, it is odd that its editors haven’t covered discount men’s clothier magnate Stuart Siegel’s clear-cutting of the riparian barrier along the river’s banks. Reporter Rex Springston, who has been briefed on the matter and viewed the site, apparently “still needs to convince his editors that this is ‘news,’” according to an email I recently received.

    Is it news that “…the city will open an investigation, and if they determine that a riparian buffer violation has occurred, the property owner may be required to replant”? Is it news that the Science Museum’s Foundation, who owns the land, would have to pay for replanting if violations are deemed to have occurred?

    Obviously not, and particularly so when some of Richmond’s biggest wheels are involved. Just another example of Babbittry at its best.

    Update: Rex Springston with the Times-Dispatch finally has the story. — Jim Bacon