Gov. Bob McDonnell has completed his amendments of the transportation bill, lowering the alternative fuel vehicle annual fee to $64 from $100 and modifying the regional tax for Hampton Roads and Northern Virginia so that it’s applicable to any region that reaches a certain threshold of population, registered vehicles and transit ridership.
By changing the language of the bill so the regional tax can be applied anywhere, McDonnell is trying to bypass a slew of complaints of how the regional tax violates Virginia’s constitution. Hampton Roads and Northern Virginia are the only two areas in Virginia that currently meet the proposed requirements for the regional tax.
Other changes are as follows:
- The proposed vehicle titling tax rate increase will put the rate at 4.15 percent instead of 4.3 percent. It’s currently 3 percent.
- A lock box has been added so funding raised in the legislation to pay for transportation can only be used for that purpose.
- A regional congestion relief fee of $0.25/$100 for real estate transactions has been reduced to $0.15/$100.
- The Transient Occupancy Tax in Northern Virginia will be set at 2 percent instead of 3 percent.
- The state will no longer be able to fund pothole repairs with money meant for new transportation projects. That practice currently costs the state nearly $400 million annually.
Virginia Democrats, including gubernatorial candidate Terry McAuliffe, have lauded the amendments.
“I applaud Governor McDonnell for once again overcoming last minute roadblocks thrown up by those who prefer extreme gridlock,” McAuliffe said. “A modern transportation system is integral to our goal of making Virginia the best for business, and this can only be accomplished through bipartisan compromise. I urge the General Assembly to approve these amendments and make the first meaningful progress on transportation in nearly 30 years.”
After the initial bill passed the General Assembly, Attorney General Ken Cuccinelli, who is also the presumptive Republican nominee for governor, wrote two legal opinions calling the bill unconstitutional. On March 22, he said because the bill imposes a special tax on specific regions — Northern Virginia and Hampton Roads — rather than criteria such as traffic or population density, the bill is unconstitional. His other opinion, issued Feb. 23, objected to the portion of the bill that requires the state to form a commission once Medicaid reform had completed at the federal level.
The rest of key points of the bill remain the same following McDonnell’s amendments. These include scrapping the 17.5 cent per gallon tax on gasoline while increasing the state sales portion of the sales tax to 5.3 percent from 5 percent. The regional tax would push the tax rate to 6 percent for Hampton Roads and Northern Virginia.
A news release from McDonnell’s office announcing the changes listed some projects that would receive some of the more than $5.9 billion the bill is expected to produce, including the widening of Interstate 64 from Newport News to Williamsburg.
The General Assembly will reconvene April 3 to vote on this amended bill and all others for final approval.
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