- The Washington Times - Tuesday, January 15, 2002

RICHMOND Virginians would vote on increasing the state sales tax by a penny to pay for education and transportation needs under two plans proposed by Republican leaders in the House of Delegates.

Delegate James H. Dillard II, Fairfax Republican, said yesterday he will introduce legislation that calls for a statewide referendum that, if approved by voters, would increase the sales tax by a half-cent for education needs.

Mr. Dillard said a statewide poll to be released today shows "the public is willing" to approve a sales-tax referendum to pay for education needs.

"The referendum is not an actual tax increase," said Mr. Dillard, who is chairman of the House Education Committee.

The money raised by the sales-tax increase would first go back to the state to be distributed to localities based on a formula used to divvy up money for education.

Mr. Dillard also filed a bill that would allow localities to hold their own referendums on another half-cent addition to the sales tax to pay for school construction. He said there is a $6.2 billion to $8.2 billion shortfall in school-construction spending throughout the state.

Meanwhile, House Majority Leader H. Morgan Griffith said if one of the many bills that would allow local referendums on raising the sales tax by a half-cent for transportation projects makes it to the House floor, he will add an amendment to make the referendum statewide.

"I would think it will probably have a chance of passing the floor, because then everybody can be seen as benefiting from it if we are going to have tax increases," said Mr. Griffith, Salem Republican.

If both delegates' proposals become law, the state sales and use tax would increase to 5.5 cents per dollar and raise about $489 million each for transportation and education.

A 4 percent sales tax was imposed in 1967, and an additional half-cent was added in 1987; $2.27 billion was collected from the tax in 2001.

In the Senate, there is not as much opposition to the referendum idea, either for transportation or education.

Sen. Charles J. Colgan, Manassas Democrat, also has a bill that would, if approved in a statewide referendum, raise the sales tax across the state to 5 percent to pay for education needs. Also includedis a provision allowing Northern Virginians to hold a referendum to raise the area's sales tax by an additional half-cent for transportation projects.

However, Senate Finance Committee Chairman John H. Chichester, Fredericksburg Republican, said he would like to see user fees rather than a tax increase pay for increases in education spending.

And to pay for transportation projects, Mr. Chichester said he would rather have an increase in the gas tax because money generated by that tax already goes to fund highway projects.

"I would like to keep the pools of money pure," Mr. Chichester said.

An obstacle in getting a locality-controlled education referendum passed has been the opposition of House Speaker S. Vance Wilkins Jr.

Mr. Wilkins, Amherst Republican, has said such a referendum would create disparities in the state, with wealthier areas having more money because they voted themselves a tax increase.

Mr. Dillard and Delegate Vincent F. Callahan Jr., chairman of the House Appropriations Committee, said the statewide referendum proposal addresses those concerns because all localities would benefit.

"Everybody should have the same [educational] chances that we do in Northern Virginia" Mr. Callahan said.

Mr. Griffith said the statewide education referendum would also prevent "balkanizing the state" and is more "fair and reasonable."

Senior Republican House sources said Mr. Wilkins, wanting to give his support, urged Mr. Dillard to submit a bill that called for the statewide education referendum.

House Transportation Committee Chairman John A. "Jack" Rollison III, Prince William Republican, said a statewide referendum to raise the sales tax for education needs could pass the House.

"When you separate the two issues [education and transportation], you can do better than if you couple them," Mr. Rollison said.

But Mr. Rollison disagreed with a statewide referendum to raise the sales tax for transportation needs, saying that could kill efforts to have a Northern Virginia referendum.

"I don't think all parts of the state have the same transportation problems" as Northern Virginia, Mr. Rollison said.

Last session, the House passed a transportation-only referendum, but the Senate insisted on a transportation-education referendum, which couldn't win a majority in the House.

The statewide referendum proposals, sources said, might be used to "beat back" bills that would grant only Northern Virginia and Hampton Roads authority to hold referendums.

Delegate Robert G. Marshall, Manassas Republican, said legislators "need to get their imagination to go beyond 'Let's just raise taxes'" and look at alternatives to a sales-tax referendum, such as more bonds to pay for transportation projects.

James Parmelee, president of Republicans United for Tax Relief and chairman of NorthernVirginia-GOP.com, said there was no need for a tax increase or for the opportunity for voters to approve an increase.

Mr. Parmelee said he and other anti-tax groups will fight the referendum if it gets on the ballot.

"Richmond is receiving 43 percent more money today than they were four years ago," Mr. Parmelee said. "If [legislators] can't make do with that then they should all resign, every one of them."

Last night, Gov. Mark R. Warner said he would sign referendum legislation on transportation if it reaches his desk.

"I believe firmly in the people's right to decide," he said in his State of the Commonwealth Address.

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