Virginia’s governor, Tim Kaine, plans to call the state legislature into special session to try to come up with new taxes to replace the regional taxes recently overturned by the state supreme court. Last week, the Virginia Supreme Court struck down taxes levied by regional transit authorities, broadly applying the principle of no taxation without representation. The court said that the legislature couldn’t delegate its power to tax to unelected bodies. (The transit authorities’ boards consisted of officials who were elected to county boards or city councils, but not to the regional transit authorities themselves.)
Before the court ruling, the governor wanted to raid the state’s transportation trust fund to pay for pre-kindergarten programs (which are often a waste of taxpayer money) and other new social programs, something even some of his staunchest supporters admitted was a “bad idea.”
He also wanted to increase the sales tax on autos. Now, he wants to raise taxes to pay for the transportation revenue lost as a result of the state courts’ ruling. But the sensible solution would be, as Prince William County Board Chairman Corey Stewart conceded, to “slash spending in other areas,” not raise taxes.
The Virginia state budget has exploded in recent years, far outstipping inflation and population growth (and economic growth, too). And property taxes have skyrocketed, enriching city and county governments.
Freezing non-transportation spending could provide plenty of revenue to pay for transportation spending, and would help offset and undo the effects of past raids on the transportation trust fund (which has been diverted from transportation to pay for public employee salaries). State Senator Ken Cuccinelli has introduced legislation that would earmark a small portion of the existing sales tax to transportation to remedy the gross imbalance between transportation funding (which has greatly declined as a share of the state budget) and the budget as a whole (which has rapidly increased).
If such remedies are politically impossible (given the enormous power of the public employee unions), then the invalidated taxes (which, bizarrely enough, fell principally on homeowners) should be replaced with fairer taxes and fees that fall primarily on those who actually benefit most from the roads.