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Tuesday, June 24, 2008

Special session may come to nothing

Republicans were quick to criticize Gov. Tim Kaine's plan to fix transportation.

RICHMOND -- Gov. Tim Kaine challenged a joint session of the General Assembly on Monday to approve a fix for Virginia's transportation problems, saying "none of us should tolerate inaction."

But as soon as the governor left the House of Delegates chamber, quarrelsome lawmakers demonstrated why Kaine will have a tough time getting any plan sent to his desk in this special session.

Kaine made another appeal for his plan to increase taxes and fees for statewide road and transit needs and for regional projects in Northern Virginia and Hampton Roads. The Democratic governor faces obstacles in a politically divided legislature that has clashing views on the severity of the state's transportation problems and strategies for fixing them.

"It is clear that this problem is real, significant and growing," Kaine said. "Our public expects us to act."

But Republican leaders in the GOP-controlled House were quick to criticize Kaine's plan and the governor's aversion to having it introduced in the Democrat-controlled Senate.

House GOP leaders oppose statewide tax increases. Senate Democratic leaders want a gas tax increase included as part of a transportation funding package, putting them at odds with the governor and many of their House colleagues.

"We're supposed to be here to close the deal, not start the deal," said House Majority Leader Morgan Griffith, R-Salem. "I'm afraid we're here to start a deal that the governor, if he were showing adult leadership, would have already had in place."

The transportation funding debate was triggered by a Virginia Supreme Court ruling in February that invalidated the taxing powers of regional authorities in Northern Virginia and Hampton Roads. The court's ruling scuttled a key component of a transportation funding package lawmakers passed last year.

In addition, an economic downturn has slowed revenue growth, forcing the state to rely more heavily on its road construction budget to cover maintenance. Kaine said the maintenance shortfall will approach $400 million in the upcoming fiscal year, and could reach nearly $600 million in the next six years if lawmakers fail to act.

Kaine's plan would increase the sales tax on vehicles and vehicle registration fees to generate funds for maintenance. He also called for an increase in the grantor's tax on home sales to fund rail and mass transit needs, and regional sales tax increases in Northern Virginia and Hampton Roads.

"That is a solid plan that gets the job done," Kaine said. "But, if you want to make improvements, amendments, changes, adjustments, I'll work cooperatively with you to do so."

House Republican leaders said the Senate should act first on Kaine's proposal, even though the governor's bill was introduced only in the House.

"If they cannot or will not send an approved bill the governor will sign, then it will be apparent that this special session is just a ploy to score political points at taxpayer expense," said House Speaker Bill Howell, R-Stafford County.

Senate Democrats have introduced bills that include elements of Kaine's plan and also include increased taxes on gasoline. The Senate Finance Committee will vote on a series of bills today.

Sen. John Edwards, D-Roanoke, introduced a bill Monday that would apply a 5 percent sales tax to the wholesale price of gasoline and increase the taxes on car rentals and vehicle sales. Edwards' bill also would remove the 0.5 percent portion of the sales tax on groceries that goes to transportation, and increase the portion of the federal earned income tax credit that Virginians can apply against their state taxes.

Edwards said his bill would net $912 million annually for transportation that would be shared statewide, without separate regional plans. Edwards said he opposed regional plans "because they tend to Balkanize the state."

Senate Majority Leader Richard Saslaw, D-Fairfax County, has proposed increasing the state's 17.5 cents-per-gallon gasoline tax by a penny a year over the next six years, increasing the sales tax by 0.25 percentage points and adding another 0.5 percentage point to the sales tax on vehicles.

But the tax increases proposed by Edwards and Saslaw likely would fall flat in the House, a point made by Sen. Ken Stolle, R-Virginia Beach, after the bills were explained to the Senate Finance Committee on Monday.

"Does anybody think that the bills we've heard so far are going to pass the General Assembly?" said Stolle, who has proposed collecting tolls on interstates to generate maintenance revenue.

House Minority Leader Ward Armstrong, D-Henry County, bemoaned the "harsh rhetoric" that followed Kaine's speech.

"The proposals set forth by this governor are modest," Armstrong said. "But if we have no willingness to sit down with one another and talk, why are we even here?"

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