Bob McDonnell plan to axe Virginia gas tax, hike sales tax advances

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Local,Virginia,Transportation,Steve Contorno,Taxes

Virginia Gov. Bob McDonnell's transportation funding plan sailed through an influential House committee Wednesday largely unscathed, paving the way for a House vote early next week.

McDonnell's plan, which would raise $3.1 billion over five years in part by eliminating the 17.5-cent tax on a gallon of gas and raising the sales tax from 5 percent to 5.8 percent, survived Democratic amendments and skepticism from Northern Virginia Republicans over whether the plan would generate enough new revenue to fix the jammed and crumbling roads around the Beltway.

House Finance Committee Chairman Harry Purkey, R-Virginia Beach, acknowledged that the plan has flaws but said advancing it would at least start the debate and negotiations that could reshape the legislation as it moves from the House to the Senate, where it faces greater resistance.

The House committee made only minor changes to McDonnell's plan in passing it on a bipartisan 14-8 vote. Natural gas cars would now be exempt from the $100 annual fee charged to owners of alternative-energy vehicles. And while the gas tax would remain on diesel fuel, owners of diesel-powered passenger vehicles would get a rebate, so only truckers pay the tax.

"With today's vote, we are one step closer to delivering the long-term transportation fix that Virginians both want and deserve," said Republican House Speaker Bill Howell. "And while today marks an important step, there is more work to be done. The legislative process is long and multifaceted."

By pushing the legislation over its first hurdle, the House gave momentum to a proposal that surprised many in Richmond when it was first unveiled. Just weeks before it was proposed, Howell said he didn't think there was enough time in the 45-day session to create and pass a transportation package, particularly in an election year. Howell on Wednesday presented the package to the committee.

But McDonnell, who hopes funding badly needed transportation improvements becomes his legacy, needs support from Senate Democrats, and they have threatened to derail his plan as payback for the redistricting plan that Republicans pushed through the Senate when one Democrat was absent from the evenly divided chamber.

Northern Virginia lawmakers have expressed concern, too, that the new revenue won't cover badly needed local projects, just maintenance and state priorities.

"I don't like the plan that eliminates the gas tax and has no local plans," said Del. Dave Albo, R-Springfield.

Committee Democrats on Wednesday pushed unsuccessfully for a 5 percent tax on wholesale gas sales instead of McDonnell's plan.

"Is it either we walk away with no plan," said House Minority Leader David Toscano, D-Charlottesville, "or worse yet, we walk away with a plan that doesn't really fix the problem but we can celebrate like it does?"

scontorno@washingtonexaminer.com

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