Virginia governor details transportation plan

| Monday, January 26, 2004

Gov. Mark Warner said Jan. 20 that he remains open to the idea of increasing fuel taxes in Virginia, but will fight efforts to divert other revenue from the state’s transportation fund, according to local media.

Warner said his tax reform plan would boost Virginia’s road-building budget by more than $1.3 billion over the next six years and eliminate the need for raiding the transportation trust fund to pay for other programs.

“We have to put the trust back in the transportation trust fund,” Warner told reporters at a press conference in Richmond.

The bulk of the additional funding would come from an existing tax on auto insurance premiums. Lawmakers voted in 2000 to earmark those funds for transportation projects, but the tax proceeds have often been diverted to other programs to balance the budget.

Warner said the revenue generated by his package of tax code changes would stabilize the state’s general fund and eliminate the need for raiding the transportation fund, the newspaper reported. The governor proposed increasing the state sales tax on goods by a penny on the dollar, reducing the sales tax on groceries and revamping the income tax structure as part of a plan that would generate more than $1 billion in new revenue over the next two years.

The governor’s two-year, $59 billion budget proposal includes $392 million in new transportation funding.

Several legislators have proposed increasing the state’s fuel tax to raise additional money for highways, but Warner said that’s not necessary.

“I’ve tried to present a plan that allows us to keep our commitments and meet our core obligations,” said Warner, although he added that he is keeping an open mind on a fuel tax increase.

“Clearly the needs in transportation are enormous,” Warner said.

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