- The Washington Times - Thursday, August 27, 2009

RICHMOND | Virginia can make progress on a highway construction waiting list now well over $100 billion in backlogged needs without new taxes, Republican gubernatorial candidate Robert F. McDonnell said Wednesday.

And should the General Assembly send him a transportation plan that increases taxes, Mr. McDonnell said in an hourlong Associated Press Interview, he will veto it.

But he would be willing to cut his own pay as governor to help the state weather its worst fiscal crisis in decades, he added.

Mr. McDonnell said increasing the 17.5 cents-per-gallon gasoline tax, which primarily funds transportation now, is pointless because its ability to generate revenue will be diminished by tighter federal mileage standards, the development of new fuels and declining usage.

Instead, he said the state would raise about $1.4 billion annually through his proposals that include using general revenues that pay for education, public safety, health care and other central government services. He also advocates using bonds, tolling and public-private partnerships.

“We’re talking about vastly improving the leverage of the existing resources,” he told an AP panel. “We’ve got a AAA bond rating; we don’t use it. We’ve had $3 billion in bonds since ‘07; we haven’t floated a nickel yet.”

The bonds, authorized in a law passed in 2007, have not been issued largely because of depressed automobile sales in recent years. The debt would be serviced largely through retail sales taxes, vehicle-related taxes and fees. Much of the revenue comes from dedicating one-third of the existing tax on car insurance premiums.

Transportation is at the heart of the campaigns of both Mr. McDonnell and his Democratic adversary this fall, state Sen. R. Creigh Deeds. Both say improvements in the state’s crumbling, congested and outdated highways are essential to creating jobs, the dominant issue of an election in the worst economic downturn in decades.

Mr. McDonnell said he would not support new taxes in the current economy. Should lawmakers later agree on new transportation taxes that eluded them in failed special sessions in 2006 and 2008, the taxes would face a veto.

“Any general increase in the taxes of Virginia I’m not going to support,” he said. “I’m not planning to raise taxes. That’s the best I can tell you.”

Mr. Deeds describes Mr. McDonnell’s detailed transportation initiative as a grab-bag of gimmicks that will raid general fund revenues that have already declined by more than $5.6 billion since July 2008. Public schools in particular would suffer, Mr. Deeds contends.

Mr. Deeds supported marginal tax increases for transportation during the two failed special summer legislative sessions in the past three years. He has said he would be willing to consider new taxes, but has stopped short of committing himself to a tax increase.

Mr. McDonnell said he’s willing to cut what would be a $175,000 annual salary if he is elected. He didn’t say how much take-home pay he’d be willing to return to the treasury.

“I’d be glad to make that a part of the overall fix,” he said in committing to a pay reduction.

He cut the budget of the attorney general’s office and his own paycheck in his final year before stepping down this spring to run for governor full time. The salary cut follows the example former Gov. Mark Warner set in 2002, when he gave up one-fifth of his salary. Gov. Tim Kaine pared back his salary one year ago.

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