But what shape is it?
There is no final agreement apparently on the regional piece. The statewide piece appears to swap a gas tax decrease with a sales tax increase, both on regular purchases (raised to 5.3%) and on motor vehicles (raised to 4.3%). Actually the gas tax “decrease” is a mirage, since the reduction will be restored on January 1, 2015 once the U.S. Congress has fulfilled everyone’s expectations by failing to authorize a state sales tax on Internet sales. On top of that, it pushes about $200M annually in general funds to transit projects.
The report puts back the Governor’s asinine $100 fee on hybrid vehicles. Through the regional piece, it also contains a “NOVA and Hampton Roads tax” with a 0.7% regional supplement to the state sales tax. Usual objections apply. We’ll be paying a new tax in the urban areas for the same service that others get for free.
How does the money add up?
The statewide piece loses money the first year ($50M), until the gas tax is restored. Then it picks up revenue from the sales tax and car sales piece. It eventually raises $700M in annual statewide revenue. That essentially cures the “cross-over” issue, which has plagued our maintenance funding.
In regard to the regional piece, it is targeted to raise $300-350M annually for NoVA and $250-300M for Hampton Roads.
(ed. note: my bill which simply raised the existing gas tax by 10 cents would have raised $500M annually, without any other increases. And it could have been explained without a team of tax attorneys on retainer).
Neither body will vote on this report until tomorrow, at the earliest.