Kaine's tax plan gets tepid backing from Democrats

RICHMOND

While Gov. Timothy M. Kaine has to fight Republican opposition to his plan to increase taxes and fees to pay for transportation projects, he also must sway Democratic legislators who have different ideas.

Many Democrats agree that Virginia has to raise about $1 billion a year for transportation needs but there is a split between party members in the House and Senate over how to raise the money.

On Monday, Kaine unveiled a plan that includes penny-on-the-dollar sales tax increases in Hampton Roads and Northern Virginia, raises statewide the tax rate on home sales by 25 cents per $100 of value, increases the state tax rate on auto sales to 4 percent from 3 percent and boosts the annual vehicle registration fee by $10. Within four years it would generate more than $1 billion annually.

Lawmakers will return to Richmond on June 23 to address transportation funding in a special session called by Kaine.

Democrats lauded Kaine for introducing the initiative and challenged GOP legislators to offer an alternative, though few have been effusive in their praise.

"The governor deserves a lot of credit for getting the ball rolling," Senate Majority Leader Richard Saslaw, D-Fairfax, said earlier this week. "What will occur over the next five to six weeks is we'll... discuss his idea and ours."

In that time, Kaine must find lawmakers to carry his transportation bill and build support.

Saslaw favors a gas tax increase to pay for maintenance costs that continue to eat into money set aside to build new roads; Virginia last raised that levy in 1986.

Citing record prices of fuel at the pump, Kaine eschews a gas tax and instead relies on increases to the auto sales tax and vehicle registration fee to pay for road repairs.

Bypassing the gas tax is a welcome development to House Minority Leader Ward Armstrong, D-Henry.

"I think the plan is basically sound," he said. "While clearly, one of the differences between the House Democrats and Senate Democrats has been the gas tax, I think there's much in common between us... The real problem is whether or not we'll get a chance to vote on this."

Democrats said getting any plan out of the Republican-controlled House could be difficult. Some legislators predict the bill will be buried in a GOP-controlled House committee. If it is, Republican legislators from Hampton Roads and Northern Virginia would avoid having to go against their own party leaders by voting for new taxes aimed at tackling their region's traffic congestion problems.

House Majority Leader Morgan Griffith, R-Salem, said GOP legislators from the two populous regions will not defect and vote for a slate of new taxes, particularly during an economic recession.

"I don't know how we're going to get anything done. It looks to me like the governor is setting us up for a train wreck," Griffith said.

Del. Kenny Alexander, D-Norfolk, disagrees.

"If we get it on the floor, I am convinced that the Northern Virginia and Hampton Roads delegations, for the most part, will vote for something," he said. "I hope my other colleagues will realize that it may be politically unpopular but we have to do something."

Del. John Cosgrove, R-Chesapeake, said Kaine's plan fails to consider tolls, budget cuts and reforms at the state Department of Transportation.

Cosgrove, who as chairman of the region's delegation has organized a regional legislative meeting to encourage elected officials to find a solution to the transportation funding problem, said he plans to take the pulse of residents through his own polling and door-to-door visits.

"Certainly we like to stay together as a caucus," he said, noting that their first "allegiance is to our constituents."

Republicans have not released their own plan but are expected to focus on the regional authorities in Hampton Roads and Northern Virginia that were created by the General Assembly to raise money for major road projects.

The state Supreme Court in February ruled the regional authorities do not have the power to impose taxes.

Rather than state legislators voting for taxes that would be controlled by the authority, GOP leaders have suggested that the General Assembly give city councils and county boards the power to raise those taxes and fees if they so desire.

Julian Walker, (804) 697-1564, julian.walker@pilotonline.com