- The Washington Times - Tuesday, May 13, 2008

RICHMOND (AP) — Gov. Tim Kaine asked legislators yesterday to increase state taxes by about $1 billion a year to improve roads.

Mr. Kaine, a Democrat, proposed increasing the sales tax on cars from 3 percent to 4 percent, and increasing the yearly registration fee from $39 to $49. He also proposed an increase in the tax assessed on home sellers statewide.

Proceeds from the “titling tax” on car sales and the $10 annual registration fee increase would be reserved solely for the upkeep and repair of the state’s nearly 58,000 miles of roads and bridges. It would increase the sale of a $20,000 car by $200.

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Mr. Kaine said maintenance costs each year are surpassing available money and that the deficit is now being covered by money allotted for new road projects. He said most of the state’s bridges are at least 40 years old.

“That money’s going into maintenance,” Mr. Kaine said.

He also said Virginia this year will divert roughly $375 million from construction to maintenance and that “filling the maintenance deficit is a precondition.”

Delegate M. Kirkland Cox, Colonial Heights Republican, questioned the administration’s projections about the maintenance deficit and that it would devour money for new construction.

“They’re taking recessionary numbers and extrapolating that over the next six to seven years,” he said. “We’ve heard all of this before and I don’t believe that’s going to happen.”

House Majority Leader H. Morgan Griffith, Salem Republican, said Mr. Kaine’s plan was “tax, tax and more tax.”

He and Mr. Cox support reprising the same mix of regional taxes and fees approved by the General Assembly a year ago, but allowing localities to impose them — not unelected regional authorities. The state Supreme Court struck down plan in February.

For the state’s congested and traffic-strangled economic engines of Northern Virginia and Hampton Roads, Mr. Kaine proposed increasing the sales tax, from 5 cents on the dollar to 6 cents, except for food and medicine.

“This is not just a regional problem,” he said. “Those two regions are the most economically powerful in the state. It’s bad for Virginia if congestion is allowed to persist in those regions.”

Mr. Kaine’s regional sales tax increases would replace the fees and taxes approved by the Assembly and subsequently struck down by the court.

The governor also proposed eliminating the option both regions were given to increase income taxes locally to generate revenue for transportation.

The “grantor’s tax” on home sales would increase the cost of a $200,000 home sale by $500 statewide and generate about $142 million a year, mostly for rail and mass transit.

With gasoline topping $3.70 a gallon in some areas and setting price records daily, Mr. Kaine ruled out an increase in the state’s 17.5 cents-a-gallon gasoline tax.

He also said the legislation his office is drafting will include a provision to ensure that none of the new money is diverted to other needs in tight budget times. If any of the new revenue is used for another purpose, Mr. Kaine said, the tax automatically expires.

Mr. Kaine also would abolish the Hampton Roads Transportation Authority, a legislative creation so widely reviled in the Tidewater region that it dominated all issues in last year’s legislative races there.

Mr. Griffith also said the governor’s statewide plan is a blow to already stagnant auto sales and the housing sector, which is suffering decreased real estate values and a downturn in sales.

Mr. Kaine’s hourlong news conference and the Republicans’ rebuttal crystallized the dispute that will likely be played out when lawmakers return to Richmond on June 23 for a special legislative session on the issue.

Mr. Cox and Mr. Griffith, backed by House Speaker William J. Howell, reject the statewide maintenance levy that Mr. Kaine called “a precondition” for successful legislation.

“If you don’t fix the maintenance deficit, it makes the regional plans a sham,” said Mr. Howell, Stafford Republican.

Mr. Kaine will begin a series of town-hall talks on his plan starting today in Woodbridge. He will hold a second meeting Thursday in Hampton.

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