Archived Story

Officials mixed on cutting gas tax

Published 9:55am Wednesday, January 16, 2013

BY ALLISON LANDRY/CAPITAL NEWS SERVICE
Landryae@vcu.edu

RICHMOND—Delegates representing the Tidewater area have mixed feelings over Gov. Bob McDonnell’s plan to boost funding for transportation in Virginia by replacing the longstanding gas tax with an increased sales tax designated for transportation.

Del. Roslyn Tyler, D-Jarratt, was surprised that McDonnell wanted to eliminate the gas tax and increase the sales tax from 5 percent to 5.8 percent.

“As I hold town hall meetings to gain citizen input, individuals were willing to have a one- to two-percent increase in the gas tax because putting an increase on sales tax is basically going to affect all Virginia residents,” Tyler said. “Right now, I think (this legislation) is just going to be a work in progress because you have individuals on both sides of the aisle that don’t particularly like certain portions of the plan. So I think there is going to be a lot of room for negotiation until we actually get a good transportation plan.”

Sen. John Watkins, R-Powhatan, and Del. Vivian Watts, D-Fairfax, have proposed transportation funding alternatives to McDonnell’s plans.

The bill proposed by Watkins would offer a 5-percent tax on gas at the wholesale level. It would add 14 cents a gallon at the pump and raise about $734 million. This would avoid McDonnell’s plan to increase the use of tolls.

Watts’ bill imposes a motor fuels sales tax rate of 5 percent for highway maintenance as well as a .5 percent state sales tax increase for transportation projects in Northern Virginia. Moreover, her bill would boost the recordation tax — a fee for recording deeds or mortgages — by 40 cents per $100 valuation to increase funding for transportation projects and maintenance.

Sen. Harry Blevins, R-Chesapeake, says McDonnell’s proposal poses advantages and disadvantages.

“I’ve had people that were in favor and thought it was creative and a way of solving some of the problems,” said Blevins. “But then there’s the question of whether or not it will do any harm to the places that money from the general fund goes to — primarily education.”

Blevins said that when the 17.5-cent-a-gallon tax bill was passed in 1986, the tax did not allow for increases in revenue.

“Back then if you bought a tank of gas for a dollar, you could drive several hundred miles,” he said. “But now that same dollar won’t buy you a half a tank of gas. So, we didn’t raise any more money even with the price going up.”

“I think that if we would have done something about that back then we wouldn’t be quite where we are today,” he added. “Personally, I think a gas tax is a user fee and it ought to be something we do consider seriously.”

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