Government Affairs

General Assembly Update

June 19, 2008

GOVERNOR KAINE UNVEILS TRANSPORTATION LEGISLATION

Governor Timothy M. Kaine today released his proposed transportation legislation to be considered during the upcoming special session of the General Assembly. The Governor’s legislation will provide approximately $1 billion a year in funding for highway maintenance needs and transportation projects in Northern Virginia and Hampton Roads.

The Governor’s bill:

• Incentivizes more efficient land use patterns by providing dedicated funding for transportation improvements in urban development areas;
• Provides start-up grant funding to increase passenger rail service through the Transportation Change Fund;
• Clarifies local government flexibility to use secondary and urban road funding for transit projects;
• Provides incentives for cities and towns to take responsibility for their road construction programs; and
• Provides funds for innovative public-private technology projects to improve traffic flow and reduce congestion on existing roads.

Governor Kaine’s bill addresses the highway maintenance deficit, increasing local road construction funding and restoring support for construction projects statewide; invests in targeted projects to reduce traffic congestion in Northern Virginia and Hampton Roads; and creates a Transportation Change Fund. The Transportation Change Fund will increase investment in transit, rail, and innovative solutions to reduce traffic congestion, like expanded ridesharing. The fund also makes dollars available for transportation projects to support economic development through aviation, port, and innovative highway investments.

The Governor’s bill:

• Increases the existing statewide motor vehicles sales tax from 3% to 4%, with a ½ percent increase in January 2009 and another ½ percent in July 2009, and dedicates all motor vehicle sales tax funds to maintenance;
• Increases the statewide annual vehicle registration fee by $10 and dedicates those funds to maintenance; Increases the retail sales tax in Northern Virginia and Hampton Roads by 1% (excluding food and drugs) for targeted projects, dedicating the funds to the Northern Virginia Transportation Authority, consistent with current law, and to seven regional projects in Hampton Roads, including the Hampton Roads Bridge Tunnel, with the regional revenues to be held by a trustee in the region;
• Abolishes the Hampton Roads Transportation Authority;
• Increases the statewide grantor’s tax by 25 cents, dedicating the funds to the Transportation Change Fund.

Consistent with past proposals, all funds that the Governor proposes for transportation include a lockbox mechanism, specifying that the fund shall expire if it is used for any purpose other than transportation.

More information on the Governor’s transportation plan can be found at http://www.transportation.virginia.gov.

To view the Governor’s bill, please click here.

Governor Kaine’s 2008 Transportation Plan, Statewide Maintenance Funding Chart