Trimmed Transportation Bill Lurches Forward


Governor Bob McDonnell’s omnibus transportation bill has undergone significant revisions during the General Assembly session, sloughing off two of its more controversial proposals, but it still has the environmental and smart-growth lobbies up in arms.

A House subcommittee amended HB 1248, a legislative behemoth that could be usefully broken into five or six separate bills, to cast off one measure that would have created an independent, statewide tolling authority. The authority would have been empowered to construct and operate toll roads, issue bonds backed by tolls but not the full faith and credit of the commonwealth, and set toll rates. It would have operated exempt from the Virginia Public Procurement Act and the Virginia Personnel Act. Smart growth lobbyists worried that the authority would be largely unaccountable to the public. But the deal killer may have been an op-ed published Feb. 2 on the Reason Foundation’s Out of Control Policy blog warning that the authority might compete with Public Private Partnerships. “If the new project is viable,” asked Robert Poole and Shirley Ybarra, “why wouldn’t a private entity consider this policy under the PPTA?”

House lawmakers also shed a provision for creating Transportation Improvement Districts consisting of territory within a five-mile radius of a transportation infrastructure project. Twenty-five percent of any growth in state General Fund tax revenues would have been transferred to transportation projects contained in the the state’s Six-Year Improvement Plan. Critics objected to the proposal as complex, unwieldy and opaque and an unneeded raid on the General Fund.

But the core of the legislation remains, including three provisions for tapping the General Fund to pay for transportation — a bigger share of the sales tax, a bigger share of end-of-year budget surpluses, and a slice of revenue growth in high revenue-growth years — as well as a measure that would give the state unprecedented power over local land use.

The McDonnell administration has justified the tax measures on the grounds that transportation is a “core function” of government that should be funded in part by the General Fund. Critics contend that, unlike education, public safety and health care, transportation has its own dedicated revenue streams; if the state needs more money for roads, raise those taxes and fees rather than diverting money from the General Fund.

Additionally, I have argued (though few seem to have picked up on it) that McDonnell’s proposal represents a historic shift away from the idea of financing roads and highways by means of a user fee — those who use roads are the ones who should pay for them — toward the idea of financing roads through general subsidies. Transportation is fundamentally different from schools and corrections. When the use of roads is free, people will always demand more. They will increase Vehicle Miles Traveled, congestion will increase, and the clamor for more, more, more will never cease. Conversely, if people pay the cost of expanding the road network through user fees, they will be far more judicious about the improvements they demand.

Meanwhile, in a press release issued  yesterday, the Coalition for Smarter Growth, the League of Conservation Voters and the Southern Environmental Law Center detailed their objections to the revised bill. “The Governor’s omnibus transportation proposal … would substantially change decades of policies.” The Virginia Association of Counties (VACO) has expressed similar concerns, though in more muted tones. States the environmentalist press release:

The bill could take over $500 million each year from the General Fund for transportation, harming education, public safety, clean water programs, and many other needs—and, unlike transportation, there are few (if any) alternative revenue sources to meet these needs. In just the first two years, the sales tax diversion alone would take over $110 million from the General Fund; enough to fund an estimated 870 police officers, 275 doctors for rural communities, or health care for 77,673 children and mothers in Virginia’s children healthcare program.

For the record, the General Assembly’s Impact Statement estimates that the bill would transfer $110 million in the 2013-14 biennium and $200 million a year by Fiscal 2018, although under the right circumstances revenue transfers could spike significantly higher. While the funds nominally would go into the Highway Maintenance and Operating Fund, because funds are fungible, the transfer would have the effect of increasing road and highway construction.

… Which raises another objection by the environmental lobby. The revenue provisions provide zero new dollars for transit and rail.

Although the environmental/Smart Growth lobby has long called for aligning transportation and land use planning, its spokespersons are not happy about how the McDonnell administration proposes to do that. This bill would require the transportation elements of local comprehensive plans and regional Metropolitan Planning Organization (MPO) plans to be consistent with the Commonwealth Transportation Board’s statewide transportation plan and its Six-Year Improvement Plan. Any project not consistent with the statewide plans, can be deprived of federal and state funding. This would give the state a much greater role in planning local land use, the environmentalists say, and it would create a mismatch “by linking a long-range local planning document (comprehensive plan) to a short-term state funding document.”

One interesting provision not mentioned in the environmentalists’ press release is one that would require the Secretary to study the devolution of secondary road maintenance to local governments and submit recommendations by the end of the year. You can be assured that VACO will be watching that one very closely.

HB 1248 now awaits a vote by the Appropriations committee, while an unamended companion bill SB 639, received a bipartisan, 13-to-0 vote in the Senate Transportation committee.

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9 responses to “Trimmed Transportation Bill Lurches Forward”

  1. Transportation Districts would have been good for Fairfax County. It would enable us to keep more tax money here, rather than send it to Virginia.

  2. DJRippert Avatar

    This has been inevitable for years, perhaps decades.

    The frozen gas tax was meant to provide a “quick and dirty” user pays model. The more you drive the more gas you buy the more taxes you pay.

    However, as we all know, the gas tax has been frozen in cents per gallon since 1986. Meanwhile, the costs of everything associated with building and maintaining roads has inflated a lot over the last 26 years.

    Our always courageous General Assembly has simply let this fiasco build. The majority of members (regardless of party) lack the guts to index transportation taxes to inflation through the simple process of indexing the gas tax. Sen Chap Petersen is a notable exception. He has repeatedly proposed indexing.

    Now, the money is going to come from the General Fund. What else would one expect? As Gov. McDonnell quite correctly states, “Transportation is a core function of government.”. In fact, state transportation policy probably affects a higher percentage of Virginians than state policy on health care, public safety or education. Nearly every Virginian uses the transportation system nearly every day. Many Virginians have no routine contact with state managed health care. Many Virginians are not in school and do not have children in school. Pubic safety is a daily issue – whether people recognize it or not. However, the main providers of public safety for me are the county police, fire and rescue departments.

    Bob McDonnell is becoming a hero in urban and suburban Virginia by actually doing something about transportation despite the General Assembly’s useless dithering. He is a vast improvement on Tim Kaine.

    The Virginia governor’s race is a scant 21 months away. Bob McDonnell is breaking a lot of ice in front of the Republicans with his actions as governor. The Democrats should take note. Urban and suburban Virginians from the right and center are seeing McDonnell (and, by extension, the Republicans) as pragmatists.

    The fact that environmentalists, Southern Environmental Law Center types and so-called Smart Growthers are complaining adds luster to McDonnell’s actions in the minds of many. Virginia’s Republicans should do their level best to associate those groups with the Democratic Party. They all come across as narrowly focused special interest types who have been all too happy to see nothing done with regard to transportation.

  3. DJR – I strongly agree about the Smart Growth crowd. The Smart Growth Coalition has taken the position Fairfax County’s Tysons traffic studies, which have been vetted by VDOT engineers, should be ignored. Those studies produced Table 7 to the Tysons Comp Plan. That table, which has been supplemented by additional FC DOT information, sets forth specific road improvements, their costs and the time frames for constructing, based on certain growth assumptions. A real bona fide land use-transportation plan. The Smart Growth people say “Just don’t build any of the roads.” Density, rail, more buses, mixed use, bikes and sidewalks take care of everything. However, this is the big lie. The County’s studies take all of those factors into account.

  4. I’m amused by the “core function” narrative in part because it means different things to different people but the gas tax is a loser these days and the folks close to the action know it because the more expensive fuel becomes the more people shift to more fuel efficient cars and even with indexing… the numbers no longer work. What indexing would get you is a solid source of maintenance and operation funds but not new construction money and Bob McDonnell and company know this and that is why they’re looking at sales taxes and other things.

    I’m very glad to see the statewide toll authority got nuked… that is a dangerous thing IMHO.

    but I still say this – if NoVa actually knew how much money it generated in gas taxes every year and how the money was spent on maintenance and operations and improvements – they’d realize just how expensive new construction is and just how little money they’d have from their region to build new infrastructure.

    I think the same thing would apply to Hampton Roads.

    I think the people in both areas are laboring under unrealistic perspectives as to how much money is truly available for transportation infrastructure.

    NOT to Bob McDonnells credit nor to his predecessors is the continued tendency to keep the localities in the dark on gas tax revenues.

    It encourages people to think their region is not getting it’s “fair share” rather than forcing each region to reconcile the realities that ..there is no Daddy Warlocks in Richmond squirreling away money in some secret vault.

    McDonnell and company are continuing the shell-game paradigm of transportation finances in Va and I think that’s a shame because people are never going to deal with the realities as long as they can pretend otherwise.

  5. DJRippert Avatar


    Please read Sen. Petersen’s actual indexing bill …

    It very much takes fuel efficiency into account.

  6. okay.. so how about some examples to show how it affects the tax in the next few years?

    but DJ .. WHY IN THE WORLD would you support sending even more money out of NoVa to RoVa in the FIRST PLACE?

    why not advocate for a NoVa tax that keeps the revenues in NoVa?

    anyhow.. aren’t the GA bills supposed to have a financial analysis done to see how they will affect taxes and costs to taxpayers?

    where is that analysis?

    BTW – Peterson’s bill has a snowball chance. It’s history as soon as it comes up in committee…

  7. 7b. Revenue Impact:
    Fiscal Year Dollars Fund
    2013 $200,000
    2014 $1,700,000
    2015 $4,900,000
    2016 $8,400,000
    2017 $12,100,000
    2018 $16,100,000

    if this is millions… it’s a gnat on a dogs butt

    if it is billions…. WHOA!

  8. take a look at this slide presentation and come back after and talk about cost vs benefits.'s%20Conference%20Presentation.pdf

  9. They all come across as narrowly focused special interest types who have been all too happy to see nothing done with regard to transportation.

    DJ: You the man! Dead straight on.

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