Associated Press

Gov. Tim Kaine said at a news conference Monday in Richmond that maintenance problems need attention now.

RICHMOND -- Gov. Tim Kaine said Monday that the mounting cost of highway maintenance and the possible consequences of ignoring it led him to propose another statewide tax increase for transportation, despite opposition from key Republican legislative leaders.

Kaine proposed an increase in the vehicle sales tax and another increase in registration fees to reduce a maintenance funding shortfall that has forced the state to use highway construction dollars for the repair and upkeep of roads and bridges. Without new maintenance revenue, the state would shift $388 million from its construction budget to meet maintenance needs in the fiscal year that begins July 1, according to administration estimates.

In a news conference, Kaine said the problem "is going to get worse and will continue to deepen unless we act."

Kaine also called for a significant increase in the "grantor's tax" on home sales, largely to pay for transit and rail projects. And he proposed a 1 percentage-point increase in the retail sales tax in Northern Virginia and Hampton Roads to finance projects in those congested regions.

The General Assembly will consider Kaine's plan and other transportation proposals during a special session that will begin June 23. The governor will take advantage of his bully pulpit in the coming weeks, holding 10 town hall-style meetings around the state -- including in Radford, Marion and Staunton -- to rally support for his plan.

Kaine said the legislature's reputation is at stake in the upcoming session, but leaders in the Republican-controlled House of Delegates showed no appetite for his proposal. Some accused Kaine of exaggerating the severity of the maintenance problem to buttress his case for a tax increase.

House Majority Leader Morgan Griffith, R-Salem, criticized Kaine for pushing tax increases in a sluggish economy.

"It's unfortunate because the people of Virginia are hurting right now," Griffith said. "The economic times are a little bit touchy, and I think it's ill-timed, but the governor has the prerogative to call us back into special session and waste the taxpayers' money if he so desires."

Kaine's plan also drew criticism from the top statewide Republicans, Attorney General Bob McDonnell and Lt. Gov. Bill Bolling.

Kaine's proposal comes one year after the General Assembly passed a multifaceted transportation funding bill that included $3 billion in borrowing to finance projects throughout the state. But two key elements of the bill have been nullified. Lawmakers scrapped controversial "abusive driver" fees designed to generate about $65 million a year for maintenance. And the Virginia Supreme Court invalidated the taxing powers of unelected transportation authorities in Northern Virginia and Hampton Roads.

Griffith and House GOP leaders said lawmakers should approve new funding plans for Northern Virginia and Hampton Roads and avoid statewide tax increases. But Kaine and leaders in the Democratic-controlled Senate insist that maintenance funding must be part of the package. Kaine said escalating maintenance costs will erode the value of last year's transportation funding package without additional revenue.

House Minority Leader Ward Armstrong, D-Henry County, agreed, saying: "Without a statewide plan, how does our region get any additional transportation revenue?"

Kaine painted a stark picture of the consequences of ignoring the maintenance shortfall, invoking last year's collapse of an interstate bridge in Minneapolis and warning that Virginia's national stature could suffer.

"No state with a declining infrastructure can maintain its place as a leader," Kaine said.

Kaine called his plan "simple, statewide and sustainable" but short of perfect. The plan would generate $859 million in the upcoming fiscal year, including $445.3 million for maintenance.

Kaine said he expects lawmakers to fashion a compromise that improves his proposal. Senate Democratic leaders stopped short of endorsing Kaine's plan, but said they will push for a statewide package.

"We want to ensure that any transportation plan is fair to every region of the commonwealth, provides enough funding, and has out-of-state drivers paying their fair share for the roads they use," said Senate Majority Leader Richard Saslaw, D-Fairfax County, in a prepared statement.

Saslaw has favored a gas tax increase to generate transportation revenue, but Kaine said the idea would fall flat with taxpayers already burdened with record prices at the pump.

"My sense in talking with the citizens around Virginia and businesses is that they view the gas tax like they view the tax on food," Kaine said. "They view gas as a necessity."

A spokesman for the Virginia Automobile Dealers Association said an increase in the vehicle sales tax from 3 percent to 4 percent could hurt an industry already suffering from declining sales. Lawmakers have rejected Kaine's previous attempts to increase the tax.

Spokesman Michael Allen said the association will review Kaine's proposal before the special session. But Allen said the economy "makes any tax increase on vehicles difficult to swallow."