- The Washington Times - Friday, February 17, 2006

RICHMOND — The state Senate yesterday overwhelming approved a transportation bill that would raise $1 billion a year from increased taxes and fees — two years after the legislature enacted the largest tax increase in state history.

The Senate voted 34-6 to approve the transportation plan, which would raise $4 billion over four years by increasing taxes on gasoline and auto sales, and fees on car registration and on selling property.

Senate Finance Committee Chairman John H. Chichester, who helped pass the $1.38 billion tax increase of 2004, said the plan is not perfect but does invest in the future.

“Will we continue to languish in a Virginia that does not have a vision for the future in the areas of transportation?” the Stafford Republican said. “The answer is no, we can’t do that. We can’t afford to do that.”

However, the Senate bill faces certain death by the tax-averse Republicans who control the House. They already have presented their own plan, which would raise $2 billion over four years without increasing taxes.

“There has been no public mandate for a second, massive tax increase in two years,” House Speaker William J. Howell said when announcing the majority party’s transportation plan. “Raising taxes further in a time of growing revenues wouldn’t just be irresponsible, it would be wrong for commuters, wrong for taxpaying families, wrong for Virginia’s economic future.”

The Senate bill will be sent to the House next week, and both chambers are expected to spend the rest of the session negotiating a compromise.

On Wednesday, the legislature reached the halfway point of session known as “crossover,” when the House and Senate are allowed to consider only the other chamber’s legislation. However, revenue and budget bills are exempted.

Meanwhile, Gov. Timothy M. Kaine, a Democrat, is holding a series of town hall meetings urging residents to tell their lawmakers to pass a transportation plan. He will hold one Tuesday in Woodbridge.

The Senate plan would increase the sales tax on cars from 3 percent to 3.75 percent, which would add $165 to the price of a $22,000 car. The plan also would increase the tax on diesel fuel to match the current 17.5 cents-per-gallon gas tax. It would increase by $10 the fee for registering vehicles and double the registration fee for heavy trucks.

The plan also would increase the grantor tax paid by someone selling property from 10 cents per $100 of value to up to 40 cents per $100 of value.

It also would remove the sales tax exemption on fuel, amounting to a gas tax increase of 5 cents on the dollar. Drivers could apply for a full refund of that tax increase by sending their original pump receipts to the Department of Motor Vehicles. The refund would total $5 for every $100 spent on gas.

There is some agreement between the House and Senate plans. Both would dedicate the tax on auto insurance premiums to transportation and impose higher fines on drivers with serious traffic violations.

But the House plan would rely mostly on “abuser” fees for traffic violations and would be funded by borrowing money and by $552 million in surplus money.

Virginia has a nearly $2 billion budget surplus.

The House has rejected Mr. Kaine’s transportation plan, which would have raised $3.7 billion over four years by increasing the sales tax on purchasing a car and raising the levy on car insurance.

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