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Virginia Gov. Bob McDonnell proposes eliminating state's gas tax
Virginia Gov. Bob McDonnell (R) has unveiled a transportation funding plan that calls for eliminating the tax on gasoline purchases in his state.
Gas taxes are traditionally used by both the federal and state governments to fund transportation projects.
But McDonnell, who was considered a potential vice presidential nominee for Republicans in 2012, said his state would be better off without the 17.5 cents per gallon tax on gasoline.
To replace it, McDonnell is calling for a 0.8 percent increase in Virginia's state sales tax to generate revenue that would be dedicated to transportation.
"Declining funds for infrastructure maintenance, stagnant motor fuels tax revenues, increased demand for transit and passenger rail, and the growing cost of major infrastructure projects necessitate enhancing and restructuring the Commonwealth's transportation program and the way it is funded," McDonnell said in a statement announcing his proposal, which he said would generate $3.1 billion for transportation projects in Virginia over the next five years.
Transportation advocates at both the federal and state levels have argued for a new funding mechanism for road and transit construction as cars have become more energy efficient. McDonnell made a similar argument in favor of his proposal to ditch Virginia's gas tax altogether.
"If we stick to the same old means of funding transportation, we will find ourselves having the same debates and facing the same revenue shortfalls over and over again as inflation slowly eats away at the gas tax, cars get better mileage to meet CAFÉ standards and more alternative fuel vehicles hit the streets," he said.
"Market forces clearly dictate that we have to change how we fund transportation," McDonnell continued. "This is a math problem. The current revenues numbers do not add up to a safe, efficient and sustainable transportation network. The time is now for an innovative and sustainable plan to meet our transportation needs and grow Virginia's economy."
McDonnell said it was important to identify new funding sources because "transportation is a core function of government."
"Children can't get to school; parents waste too much time in traffic; and businesses can't move their goods without an adequate and efficient transportation system," McDonnell said.
House Transportation and Infrastructure Committee Chairman Bill Shuster (R-Pa.) has made similar arguments about the necessity of considering other revenue sources for transportation projects.
The 18.4 cents per gallon federal gas tax currently generates about $35 billion per year. The $105 billion transportation bill that was approved by lawmakers last year, however, appropriates more than $50 billion per year to road and transit projects, which transportation advocates say is just enough to maintain the current system.
Lawmakers used a package of increasing fees and closing tax loopholes to cover the almost $20 billion short fall, which Shuster has recently referred to as a "transportation fiscal cliff."
