By: Bill Wilson
In the delicate game of placing more of a financial burden on the general public, the state of Virginia has decided to play its index card.
By a 31-9 vote, the state Senate passed a bill authored by Sen. Emmett Hangar (R-Augusta) that will index the state gas tax.
The measure will link the levy to federal Corporate Average Fuel Economy (CAFE) standards for the fuel efficiency in cars. The proposal would take the percentage increase in the CAFE rate each year and multiply that by Virginia’s state gas tax, which currently stands at 17.5 cents a gallon.
According to John Lawson, director of the Financial Planning Division at the Virginia Department of Transportation, the indexing will not amount to much at first, but could grow into a significant number. If the bill is enacted, the formula will generate $12 million in additional funds in 2011, $85 million in 2012 and $166 million in 2013. The growth is equivalent to the state gas tax, which has not been increased since 1986, increasing by about 4 cents a gallon by 2020.
“Once you get out there a couple of years you have some pretty significant dollars compared to where we are right now,” Lawson told Roads & Bridges. “We don’t have anything that will allow us to keep up with inflation,” Sen. Steve Newman (R-Lynchburg) told the Fredericksburg Free Lance-Star. “I hope the concept of moving forward with a percent as opposed to the cents will continue.”
Virginia continues to trip over the troubled economic conditions plaguing the entire U.S. Back in December 2009, the Commonwealth Transportation Board sliced another $42 million from its 2010-15 six-year improvement program to bring the grand total in cuts to $893.5 million.
Since spring 2008, available transportation revenue has been reduced by a staggering $4.61 billion, with the state’s new construction program suffering the most. Lawson said that account has been reduced down to just federal funds while Virginia pulls enough money together to simply maintain its system.
“We have tried to keep funding our maintenance program to protect our investment of what we have out there,” he said. “Our resurfacing schedules are actually growing some as we try and catch up and prevent further deterioration.”
And even though the act of indexing the state gas tax will generate some additional funds, Lawson said the state still plans on aggressively pursuing public-private partnerships to help fuel the new construction program.
“While a couple of hundred million a year is not small change, it clearly is not the total solution,” he said.
The Senate bill was expected to be introduced to the House by late February, where many anticipate it will face tough opposition.
