Governor McDonnell has proposed a solution – or the beginning of a solution, at least – to the transportation funding crises in Virginia. The most significant element is the elimination of the state gas tax, and its replacement with a 0.8% increase in state sales tax. Both the Not Larry Sabato blog and the Bearing Drift blog summarize and offer some analysis of the plan, which I encourage you to read.
RIDE Solutions doesn’t come down on one side or the other, here – in general, we feel that anything that gets more money into transportation is a good thing (with the caveat that we believe the commonwealth’s transportation system should be run as efficiently as possible before we plow more dollars into new road-building or congestion management projects).
Here are some of my personal thoughts on some elements of the plan:
1) Eliminating the gas tax, increasing the sales tax. One of the justifications for the gas tax is that it’s basically a user fee, so eliminating it could make the waters murkier in terms of connecting the public benefit with the public cost. On the other hand, I’ve repeatedly made the argument that the gas tax falls far short of covering the costs of the transportation system, so getting rid of it might be the best way to stop having that argument – transportation then becomes a public benefit that everyone pays for. This can also be of benefit to the cycling world, as I often hear the argument that since cyclists don’t pay gas taxes (of course, they do, since most cyclists are also drivers), they don’t have a right to the road. Elimination of the gas tax would eliminate that argument.
A Facebook post I read suggested one downside is that the burden of a sales tax may fall more heavily on Virginia residents than out-of-state travelers. This may very well be the case, and I’d like to see data, if it was available, that showed how many out of state drivers fueled in Virginia gas stations. That said, as Bearing Drift points out, the diesel fuel tax is remaining, so one of the major out-of-state users of Virginia highways, trucking companies, will continue to contribute to our transportation fund.
A move to the sales tax as the primary source of funding would also offset the effect of improving mileage standards on upcoming generation of vehicles, something that has been a problem for some time.
2) Increasing registration fees as a dedicated source of transit funding. I agree with Not Larry Sabato here that any dedicated source of transit funding is probably a good idea. I’d prefer it as a dedicated percentage of the sales tax, but any place is a good start.
3) A new $100 yearly fee on alternative fuel vehicles. Not sure how I feel about this one yet. Not Larry Sabato makes the argument that this penalizes the cleanest-running cars, which is a good point. On the other hand, hybrid, CNG and other vehicles haven’t contributed to transportation funding at the same pace as conventionally fueled vehicles for a number of years, and though they have a smaller cost in terms of pollution, they contribute equally to congestion costs, road maintenance costs, the land-use costs of parking, etc. In the sense that this fee could be playing “catch up” in getting these vehicles to contribute their fair share, I don’t know that it’s a bad idea. But as a permanent new fee, I’m not sure that it’s fair. A fee based on vehicle weight might be more appropriate, but I’m not really sure about that, either.
There are a few other elements discussed in the other blogs that you might want to take a look at – these are just the items that I feel make sense to look at from a TDM perspective.
EDIT: One thing I forgot to add – the benefit of the gas tax, and of raising the gas tax to the levels needed to fund transportation needs, is that it does serve as a disincentive to drive unnecessarily. In that regard, high gas taxes encourage alternative modes (where they’re available – a lot of rural areas without good transit options are still left with long distance commutes to work and shopping). That’s the upside of the user-fee element of the gas tax: you can avoid paying it by driving less and not buying gas. This has a beneficial effect on pollution, congestion, land-use, etc.