Issue Position: Transportation

Issue Position

MY COMMITMENT TO YOU
No solution can be off the table in tackling this major problem; including enhanced transit, increased road capacity, Department of Transportation accountability and management, coordinated land use, private/public financing, user fees that track inflation, increased state and federal funding to Northern Virginia, greater control over Fairfax County roads, intersection improvements, telecommuting, etc.

You know and I know road congestion and maintenance in Northern Virginia has gotten worse and worse! Everyone else knows, too. For two years running, this region has been ranked the MOST congested in the nation. NV rush "hour" is 7 hours long. We spend 67 hours a year tied up in traffic at a cost of $1398 in time and fuel.

It got this bad in large part because the last time Virginia increased state funding was 1987. Every other state increased their gas tax (except the wide-open states of Alaska and Oklahoma.) Revenue from the per gallon gas tax used to fund over half the state's construction budget -- by 2013 it was less than 1/6.

THE FUNDING BREAKTHROUGH
It will take a long time to make up for this refusal to act, which is why I started on such a highly negative note -- instead of crowing about the amazing funding breakthrough of 2013 which I spent so many years trying to achieve.

The 2013 General Assembly passed a package of new transportation funding that will raise $1.3 billion a year by 2017. The major driving forces behind this long overdue break-through were:

Everything else had been tried, including using 80% of transportation borrowing capacity for the next 25 years.
By 2017, there would be no state money to get 80-90% federal funding for major projects. Federal gas taxes Virginians had paid would go to other states.
Seriously deteriorating maintenance finally got rural legislators to the table.
Virginia lost its rank as the best place to do business solely because of congestion in the urban crescent.
The compromise wasn't simple. The bottom line is:

What passed provides the sustained annual funding that study after study underscored we must have to address the backlog of basic needs.
Northern Virginia gets control and serious funding.
All road users will continue to pay through the gas tax (despite Gov McDonnell's proposal to eliminate it.)
WHERE IT WILL BE SPENT
Over $300 million a year will be raised in Northern Virginia and constitutionally it must be spent on transportation in Northern Virginia. If it is not, the NV taxes are repealed. Funds must be used for road or transit improvements that reduce congestion. 70% or over $200 million will go to regionwide projects and Northern Virginia -- not Richmond -- will control what these projects are.

The rest goes back to the NV locality where it was raised. This local 30% also must be spent to address congestion. However, in addition, each local government also must commit funds (equal to a 12.5¢ real estate tax on business properties); however, this locally raised funding can be spent more broadly for any non-maintenance purpose. Fairfax County will control approximately $100 million a year for transportation -- half from the bill we passed and half from the required local funding.

For the last 4 years, the State has spent zero on local road improvements. By 2016, state local road construction funds finally will start flowing again. The delay is due to the state taxes being phased-in and an initial $300 million in state funds that went to fund rail to Dulles.

Indeed, transit funding was significantly increased across the board. State transit support will more than double from the current $130 million.

WHERE IT COMES FROM
The 17.5¢ per gallon gas tax that's been in place since 1987 wasn't increased. But it will be replaced (starting January 2015) with a tax on the wholesale price so that revenue grows with inflation. (The new tax rate on diesel fuel will increase taxes on trucking, but diesel cars can get a rebate on the difference.) The bulk of the new state revenue comes from the tax on car sales going from the current 3% to 4.15% by July 2016 and from raising the sales tax on non-food items across Virginia from 5% to 5.3%.

In Northern Virginia and in Hampton Roads, the sales tax increases to a full 6%, with the additional amount going to fund transportation in the region where it is raised. Northern Virginia also will use an additional 2% hotel tax and a 15¢ per $100 tax on real estate sales. The total tax package of these three taxes along with the real estate tax on business properties, the value of car purchases, and the gas tax are an attempt to spread the burden of over all road users and factors that increase congestion.

GET INVOLVED
From where I sit, the result of all these changes should support better coordination locally to remove bottlenecks, increase transit use, and deal with the impact of land use decisions. I look forward to working with you and our local officials to reach these goals.

ON-GOING CHALLENGES
What Northern Virginia Gets From The State

First, the position we gained in 2013 must be constitutionally protected. The reason we stopped getting state construction funds was because in 2002, annual budgets began diverting more and more local construction money to maintenance statewide. By 2008, no local construction money was left.

Unfortunately, constitutional amendments I've patroned and co-patroned to protect transportation funds are always killed in the Senate by those who want to divert General Fund tax dollars to fund transportation. Besides the harm to public education and other critical services, using General Funds would be even more unfair to Northern Virginia. Because 65% of the General Fund comes from the income tax, Northern Virginians contribute over 43% of the General Fund , while we only pay about 30% of the transportation fund. In addition, General Fund taxes come only from Virginia taxpayers...the 20% to 30% drivers who aren't residents get off the hook.

Here is a technical discussion of Maintenance Funding that lays out why we must have a State Constitutional Amendment. See also 2004 House Floor Speech and 2004 budget amendment.

If we keep the current road allocation formula from being over-ridden, the 1985 formula I played a key role in passing automatically increases funding for local secondary roads with annual population growth. NV has approximately 27% of the state population and under the formula gets approximately 25% of the money spent on state construction and transit. About 30% of state transportation revenues are raised in NV.

I continue to try to further close the gap through changing the formula for how primary roads are funded, which I introduced repeatedly from 2002 - 2009. (Primary roads are those numbered under 600 -- ie, Rt 123, Rt 236, and Rt 50 -- and secondary roads are roads with higher numbers.) My bill would double funding for Northern Virginia primary roads by tying the funding to the number of vehicles miles traveled per lane mile. I refer to this as the "congestion factor."

My 2007 Newsletter discusses Northern Virginia getting our fair share for transportation. See also floor remarks on Fair Share for Northern Virginia. Also, I did get a bill passed in 2002 (HB771) to ensure that Northern Virginia's needs are fairly considered on an even playing field. It requires that transportation priorities be established using the same criteria statewide and that transit and road needs be considered side by side.

COORDINATING TRANSPORTATION AND LAND USE

In 2007, we passed measures to tie land use more closely with owners paying for the transportation impact of new development. The effect of these new tools will depend on local governments having the discipline and sophistication to avoid court challenges if they divert funds or make inconsistent zoning decisions.

Equally important, as Secretary, I chaired an unprecedented regional effort that brought land use and transportation plans together for the first time to create a coordinated Northern Virginia Transportation Plan. The NV Transportation Authority's updates of this regional plan provide an essential foundation to focus the new NV funding we passed in 2013.

PARTNERSHIPS WITH THE PRIVATE SECTOR

I believe in finding win/win opportunities for businesses to be full partners in funding congestion solutions. 80% of improving 16 miles of Rt 28 from 2 lanes to expressway capacity was paid for by a tax on business property that I negotiated as Virginia Secretary of Transportation. This is the finance model that is constructing rail to Dulles -- supplemented by federal funding and by Dulles Toll Road revenue.

However, I have a love/hate relationship with the Express Lanes. While the immediate benefit has been reduced Beltway congestion, the real potiential is to significantly strengthen regional transit. Extending Metrorail is prohibitively expensive and doesn't have the flexibility to serve the pattern of development from Springfield to Tysons and from Springfield south. My concern is that the transit potential will only be realized if local governments make the hard decisions to create park and ride lots with convenient access to I-95 and to fund local bus service that meet commuting needs to the major NV employment centers of Tysons, Springfield Mall / EPG / Ft Belvoir, and Mark Center. Otherwise, improving traffic flow only entices sprawl and only temporarily reduces congestion.

Financing is also a concern. The private operator has complete control in setting tolls for 70 years. Tolls have to be high enough to pay-off construction debt, but if they're too high, drivers won't pay the price. If there are too few toll-paying vehicles, the State must pay the private operator for HOV vehicles if they make up more than 25% of the traffic in any 15-minute period.*

Finally, over 30% of the Beltway construction impacted my Delegate District. While neighborhoods have been helped with Transurban landscaping grants and limited soundwall additions, cut-through traffic remains a concern. With re-districting, I now represent the greatest neighborhood impacts of the 1-95 / I-395 Express Lane construction and completely share the deep frustration of impacted residents that the new lanes were stopped short of Mark Center when they should have been extended across the Potomac.

These and other concerns about the public accountability of projects that are owned privately led me to introduce a bill in 2008 calling for a study of competitive bidding under Virginia's Public Private Transportation Act (PPTA).

(*The State funded 21.5% of the $1.9 billion Beltway project cost, which was largely used to pay for replacing 50 aging bridges and overpasses, 3 new interchanges, and pedestrian/bicycle crossings. Private investors, looking for a 13% return on investment, put in $350 million. The remaining $1.2 billion came from 40-year bonds that will be repaid by tolls. Tolls also must cover all maintenance and operation costs. For I-395/I-95, the State is paying directly for 8% of the project cost of the express toll lanes.)

BACKGROUND

For more detail, the links below take you to charts, commentaries, and testimony I've prepared* over the years --unless otherwise credited. Unfortunately, they are as important today as when I first developed them. I've put them in order of relevance to your understanding the problem rather than by date.

The gap between transportation needs and funding is much worse since I developed this Basic Gas Tax Revenue Chart in 2001 to answer legislators' objections to passing my bill (HB1984) to raise the gas tax. It'd look the same today, only the gap would be much wider. It is a graphic representation of how far behind we are and how long it will take for the 2013 funding to address the need. Note: The representation of NEED does not include growth in transit use.
Since Virginia last increased transportation funding in 1986, Demand Up Supply Down since 1986 shows the growth through 2004 in traffic (71%), transit riders (58%), car ownership (53%), licensed drivers (34%), population (28%), and expanded road capacity (7%). (Chart reflects statewide growth and was prepared by Fairfax County.)
The cost of highway and street construction rose 89.1% between 1986 and 2006. (Source: U.S. Department of Labor's Producer Price Index for Highway and Street Construction. The 40% in Fairfax County's chart above is the general Consumer Price Index) Click here for a discussion of essential investments that must be made for an effective, safe transit system.
If transportation had continued to be funded at the level established when I was Secretary under Governor Baliles, Virginia would have spent over $3.5 billion more from 1995 to 2005 on transit and road improvements, making congestion substantially less than it is today.
Although, as Secretary, I had cut construction time by 20% and increased employee efficiency by over 30%, by 2002, Governor Warner discovered fully 1/3 of the projects that had been promised by the previous Governor had to be cut because funds never had existed to fund them. Reforms build on 9 separate audits from 1999-2010. We now have accurate reporting of on-time and on-budget performance rather than politically convenient promises.
Part of this financial management reform can be found by going to dashboard.virginiadot.org. These reforms have produced over 80% on-time, on-budget performance year after year. Finally, here is a one page Audit Fact Sheet about what a 2010 audit really said about VDOT not spending all available funds -- mostly out of un-certainty about the economy which led to a 6-month reserve rather than 3-month.

As a delegate in 1985, my work was key to changing the highway funding formula to more than double Fairfax's share of state funds. As Secretary, among other achievements, I increased Metro funding 4-fold, freed toll revenue for use to make cooridor improvements, forged 80% private funding to improve 16 miles of Rt 28, negotiated VRE use of railroad right of way, crafted the private toll road legislation for the Greenway, and chaired development of the first Northern Virginia unified land use and transportation plan. These landmark initiatives continue to be models for most of the current "new" ideas to solve transportation problems.

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