The Virginia Senate this afternoon gave approval to a landmark transportation funding package that will raise $880 million a year for roads construction, maintenance and mass transit through a series of tax increases on fuel and purchases.
Senators in the evenly divided chamber voted 25-15 in favor of House Bill 2313, which on Friday cleared the House of Delegates on a bipartisan 60-40 vote.
The bill, which now heads to Gov. Bob McDonnell, is the most significant funding package for transportation in Virginia since lawmakers agreed to raise the per gallon tax on gasoline in 1986.
“This is a historic day in Virginia," McDonnell said in a statement. "We have worked together across party lines to find common ground and pass the first sustainable long-term transportation funding plan in 27 years. There is a ‘Virginia Way’ of cooperation and problem solving, and we saw it work again today in Richmond."
When fully phased in, the plan will raise more than $500 million to erase the looming deficit in the state's road maintenance budget, while funding new roads construction, mass transit, and providing additional dollars for Hampton Roads and Northern Virginia, the most congested regions in the commonwealth.
Supporters said the plan will be a sustainable, dedicated funding stream to Virginia's overburdened transportation infrastructure, considered critical to maintaining the state’s economic vitality. Opponents, meanwhile, criticized the number of tax increases packed into the measure and argued that a transportation fix should rely more heavily on those who use the roads.
"This is not a perfect bill... but it solves a problem," said Sen. John C. Miller, D-Newport News.
The legislation:
* Replaces the per gallon tax with a 3.5 percent tax on gasoline at the wholesale level and a 6 percent wholesale tax on diesel fuel, with a rebate available to clean diesel vehicle owners.
* Raises the state sales tax from 5 percent to 5.3 percent
* Increases the motor vehicle sales tax from 3 percent to 4.3 percent.
* Increases the amount of general fund revenue spent on transportation from .5 percent to .675 percent
* Provides for a .7 percent sales tax increase in Hampton Roads and Northern Virginia to fund local roads improvements in the state's msot congested regions
* Draws funds from future Internet sales tax proceeds if Congress passes the Marketplace Equity Act. If the act fails, the revenue would be replaced through an additional 1.6 percent tax applied to the wholesale gasoline tax.
* Prohibits tolling on I-95 toll south of Fredericksburg without General Assembly approval.
* Imposes a $100 registration fee on alternative fuel vehicles and hybrids.
“This is a historic day in Virginia," McDonnell said in a statement. "We have worked together across party lines to find common ground and pass the first sustainable long-term transportation funding plan in 27 years. There is a ‘Virginia Way’ of cooperation and problem solving, and we saw it work again today in Richmond."
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