Dear Friends and Neighbors,

Well, at least Richmond is beautiful this time of year! With the Governor's announcement of a Special Session on June 23rd, I will be packing the car and heading south to start work again on the issue of transportation. As promised in previous newsletters, I wanted to give you a heads up on what is being proposed and to invite your input and ideas.

Before I do that, Gretchen, Alex, Josette, and I want to welcome the newest addition to the Bulova family. Grayson was born on May 3rd at 3:02 a.m. and weighing in at 7 pounds, 11 oz (yes, our 7-11 baby). Mom and baby are doing great.

Transportation

One week before the end of the regular session, the Supreme Court threw us a curve ball by invalidating the fees put in place by the Northern Virginia Transportation Authority. Regrettably, the decision didn't invalidate our transportation crisis. And so, it is back to the drawing board. I never like to talk about raising revenue without first talking about the need. Essentially, we are dealing with three issues: lack of funding for new infrastructure (regional transportation plans put the need at about $700 million more annually just to keep congestion from getting worse); lack of adequate revenue for mass transit (VRE and Metro); and, the increasing cost of road and infrastructure maintenance. For the time being, I will avoid making any comments on the sufficiency of that maintenance. However, the immediate crisis is that maintenance is slowly consuming the entire transportation budget – and within a few years we will actually be leaving federal matching dollars for new construction on the table.

In Virginia, as it has been since the 1930s, a majority of transportation revenue comes from dedicated sources, and not the general fund. This was done to prevent transportation (which requires long-term planning) from having to compete with short-term needs. For the most part, these sources are set at specific dollar amounts (such as the gas tax, which is set at 17.5¢ per gallon) and don't increase with inflation. Hence, since we haven't touched many of these taxes in over 20 years, their purchasing power has significantly diminished.

As we approach the Special Session, it is clear that there is not much unanimity on how best to solve the problem. However, the severity of the crisis in urban areas led to an unprecedented meeting of the Northern Virginia and Hampton Roads delegations last month. While I was a little skeptical of whether we would get anything accomplished, there did seem to be a sincere desire to work together on a solution.

Two weeks ago, the Governor introduced his transportation plan. It isn't perfect, but it does provide a good starting point for discussion and I commend him for that. Basically, the Governor's plan has three State-wide elements:

1. Increase the titling tax (basically a sales tax on cars) from 3% to 4% -- the tax applies to all cars registered in Virginia, regardless of where it was bought;
2. Increase the grantors tax (a tax paid on the sale of a home) by 25 cent per $100 of the value of the home; and,
3. Increase the vehicle registration fee by $10.

In addition, the Governor has proposed a one cent increase in the sales tax in Northern Virginia (excluding food and drugs). Importantly, what is raised in Northern Virginia will stay in Northern Virginia. This is a 100% return on our investment, which is better than any funding formula that goes through Richmond.

So there it is. I am not thrilled with the grantors tax since housing costs are already too high and most of the grantors tax is generated in Northern Virginia. As a result, we actually pay more this way than we would using another revenue source. I would also like to see us do a better job of ensuring that out-of-state visitors pay their fair share.

For my part, I have introduced a bill to address the current inequities in the maintenance funding formula. While Northern Virginia represents approximately 26% of the population, we only get back 14% of maintenance funds. My bill links the funding formula to actual maintenance needs, which are assessed by VDOT every other year. It isn't rocket science – but it isn't how things are currently done.

Summer Homework

If you made it this far, you are truly a special constituent! Leaving on a positive note, each year the Speaker appoints members to various studies and commissions that meet during the off-season. I like to think of it as summer homework. I am pleased to have been appointed to three studies/commissions. These include the Governor's Commission on Climate Change, a Special Subcommittee to Study ABC Issues (yes, we are dusting off our alcohol laws for the first time since prohibition), and the Joint Commission on Health Care. If you are interested in any one of these topics, please let me know so that I can keep you involved.

Have a safe and happy June!

Grayson Bulova

Sincerely,


David Bulova