There’s a New Tax-and-Spend Party in Town

The House and Senate conferees have pounded out their final compromise on the transportation package. There are two more obstacles to go: The Senate must approve the final version, which may or may not happen: Democrats and a handful of Republicans are still unhappy with key elements of the plan. And then the package goes to Gov. Timothy M. Kaine, who also has expressed his displeasure.

As compromise has succeeded compromise, and amendment has piled upon amendment, the legislation, to my mind, has gotten worse and worse. The most significant change in this latest iteration, according to a press release from the Speaker’s Office is that it relies even less upon the General Fund than previous versions to pay for roads. Total General Fund revenues amount to “consistently less than 1 percent in any given year – and actually declines as a percentage over time.”

In other words, the legislation requires increased taxes, levies, fines and fees from other sources. Here’s how it the new revenues stack up: (1) a statewide revenue stream reaching $600 million per year; (2) regional taxes of more than $400 million per year for Northern Virginia; (3) regional taxes of more than $200 million for Hampton Roads; and (4) a sweetener of $2.5 billion in bonds issued over an eight-year period.

We started the General Assembly session arguing whether Gov. Kaine’s proposal to increase statewide taxes by $1 billion revenue was too much. Now the putatively “anti-tax” Republicans are patting themselves on the back for a package of state and regional taxes, fees and fines totaling about $1.2 billion a year — and that’s before taking on $2.5 billion in debt. No wonder Kaine has been sitting quietly and “contributing nothing” throughout this process. The more the Republicans have talked, the richer they’ve made the tax-and-spend elements of the legislation.

I can only imagine that Republican legislators are so close to the process that they have lost all perspective. They haven’t noticed that they’ve moved backward, not forward. They may be able to insulate themselves against charges of “doing nothing” on transportation, but they also have to deal with the utter dismay of their small government constituents. Maybe there’s something I’m missing, but based on the documents provided by the Speaker’s Office itself, I am absolutely apalled.

HB 3202 does contain a couple of useful VDOT and land use reforms, but they only tinker on the margins of the problem. They don’t begin to un-do the damage created by the incoherent mix of tax revenues, or the shoveling of money into unaccountable regional transportation authorities. This entire process has wound up worse than I could ever imagine.

J.R. Hoeft over at BearingPoint, a solidly Republican blog, doesn’t sound any more enthusiastic than I am. If there are any Republicans out there who want to defend this legislation on the grounds of conservative/free market principles, as opposed to a panicky bid to save their nexts in the next election, I would like to hear from them.

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11 responses to “There’s a New Tax-and-Spend Party in Town”

  1. nova_middle_man Avatar

    Jim this is what people wanted

    The majority of people in Virginia do not see a transportation crisis and dont like higher taxes

    Hampton Roads is next at 200 million (don’t really know this area well so can’t comment)

    NoVa doesn’t mind taxes as much especially when the money stays in the region

    From a NoVA perspective I truly prefer this instead of a 1 billion state plan where we see pennies on the dollar we get to keep 400 million in this version. I don’t have a problem with the general fund moves but up here in this purple blue area that is political suicide.

    So given the current political climate this is the best I think we could have done and I really don’t think its that bad.

    As far as land use and overall accountaibilty and planning I would love to see more but in the minds of the voters (anti-taxers and tax-and spenders) that is not an issue

    I guess the solution is to continue the work you are doing on this blog to further educate the public and to try and get the MSM to move beyond the money issues

    Just remember what would happen if the Ds were in control

  2. Toomanytaxes Avatar

    NMM – I see it quite the same as you. NoVA is not opposed to paying more, but will not support sending dollars to Richmond for pennies in return. I’m not arguing I support this plan or any other plan. I want reform first.

    But any Democratic plan would involved statewide tax increases, which means dollars out and pennies in. Moreover, why would anyone think the Ds would do land use reform?

  3. James Atticus Bowden Avatar
    James Atticus Bowden

    Jim: I got an earful from the Chairman of the RPV, Ed Gillespie, at a breakfast this morning with the Hampton GOP. He got an earful from the Hampton GOP about unelected, unaccountable Regional Government, more taxes and plan that does NOT work to decrease congestion.

    Do you want me to elaborate here or as a separate post?

    Un-BEE-lievable. Makes me want to take up cursing again.

  4. Larry Gross Avatar
    Larry Gross

    I agree with NMM&TMT.

    and I do think that voters in NoVa will not turn out their R legislators with their concurrence of this agreement… it will… save their bacon… I think.

    And if not mistaken… NoVa will have to approve the sales tax incrase in referenda – right?

    I think this strikes the right balance between letting regions decide their own destiny with regard to taxation and transportation while giving RoVa enough so that it is not balkanization.

    It actually is working like the School SOQs work where everyone gets a minimum standard and then those localities with higher needs – can decide – if they want to spend more local money on those issues.

    RoVa can do the same thing also – on a county/city basis or they can group together cooperatively in transportation district authorities – again per the voters agreement.

  5. Reid Greenmun Avatar
    Reid Greenmun


    During the “State of the Region” report by Jim Koch (Ex-President of ODU) at this morning’s Virginia Beach Taxpayer’s Alliance public meeting the discussion of HB 3202 and the new all-appointed Regional Transportation Authority slated for TW/HR was a very heated topic.

    Especially interesting was the trends information presented about TW/HR. Surprise, surprise, the ODU economic assessment reveals an outward migration of JOBS – due to several key factors. High on the list were:

    (1) The Closing of the Ford Plant in Norfolk – significant loss of high paying jobs.

    (2) BRAC – and the fact revealed that the Navy will not locate the new JSF (Joint Strike Fighter) at NAS/MJB Oceana (in Virginia Beach) – HUGE Loss of high paying JOBS and related lower paying service sector economy JOBS supporting Oceana.

    (3) The relocation of 1 (or more!) Carrier Battle Groups to somewhere other than Norfolk.

    (4) A glut of excess housing capacity and not ready source of new JOBS to provide buyers – especially hardest hit will be – surprise, surprise, “Smart growth”, Mixed-use, condo development and new higher density “Town Centers” constructed within our region in the past 5 years. This will slow down JOBS related to new construction.


    None of the PDC/MPO residential growth and resulting traffic models have taken into account this exodus of high-paying JOBS out of TW/HR when projecting their doom & gloom projections of the future “Traffic Crisis” that the politically influential growth lobby has been screaming, “The Sky is Falling!!, The Sky is Falling!!” about!

    Interesting, isn’t it?

    ODU also focused this year’s State of the Region Report on the HRBT traffic bottleneck.

    Yet, the proposed $4.4B 3rd Crossing included in both the Senate and House transportation bills does almost nothing to reduce traffic congestion at the HRBT!!!!!

    Are you “getting this?” – all GA bills in discussion FAIL to offer a plan to reduce traffic congestion at the HRBT.

    Folks, the Emperor has no clothes – and even the ODU “State of the Region Report” reveals this – yet the sound of silence is ALL that we hear from the MSM on this inconvenient truth.

  6. Darrell -- Chesapeake Avatar
    Darrell — Chesapeake

    Do you know what we have here in Tidewater? We have 1960s San Francisco Bay Area, minus the business powerhouses that helped sustain the growth that area has achieved. Back then that city faced many of the same issues as we do today. Their political leadership created the foundation for a multitude of economic opportunities. The same can not be said for Virginia’s politicians of either party.

    When one looks at the transportation projects that are being pushed, the Heartland Corridor, the third crossing, Rt. 460, none of which solves our congestion problems, one wonders why the politicians appear deaf to the public’s concerns. God knows we have voiced our opinion many times. It’s because their vision is different than ours. The entire future of Tidewater is being focused on port expansion. Enormous amounts of capital are being spent towards making this region the largest and busiest port on the East Coast. It leaves nothing to address the average person’s quality of life issues. Twenty, thirty years down the road, the results will be apparent.

    We have the opportunity to turn Hampton Roads into a gem of the East Coast. Instead, our leadership is pursuing a plan to reap Fool’s Gold, building a community that will continue to lack economic diversity. The reward for choosing this path isn’t San Francisco.

    It’s an oversized version of Long Beach.

  7. rodger provo Avatar
    rodger provo

    Virginia suffers from a lack of good, constructive leadership

    We are unable to create a vision for our future that all of the
    stakeholders will rally to support.

    The state is trapped in a mindless
    political fight between the D’s and
    R’s, the left and the right, tax
    advocates and anti-tax advocates,
    no growth forces and anti-growth
    forces and the list goes on and on

  8. Jim Bacon Avatar

    JAB, Sounds like the exchange between Gillespie and the Hampton GOP warrants its own post. I think it’s newsworthy to highlight the tensions within the GOP over this legislation.

  9. Jim Wamsley Avatar
    Jim Wamsley

    “(4) A glut of excess housing capacity and not ready source of new JOBS to provide buyers – especially hardest hit will be – surprise, surprise, “Smart growth”, Mixed-use, condo development and new higher density “Town Centers” constructed within our region in the past 5 years. This will slow down JOBS related to new construction.”

    Smart Growth is a balance of Housing and Job within a 5 mile circle. Removing “jobs” is a dumb growth act only if it results in an excess of housing. In many locations the removal of jobs will reduce long distance commuting.

    This is an “opportunity to turn Hampton Roads into a gem of the East Coast.” We should spend our taxpayer dollars wisely.

  10. Toomanytaxes Avatar

    Rodger: I tend to agree with your factual assessment. Virginians are not in agreement on growth, transportation and taxes. While legislative gridlock can be frustrating, it probably reflects the overall mood of the state on these issues. While many people would probably pay more to see traffic congestion fixed, few believe that the State’s goal is to improve traffic congestion.

  11. rodger provo Avatar
    rodger provo



    People do not trust the political class today at any level of
    government to resolve our problems.

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