It appears as if Senate Finance Chairman John Chichester’s favorite movie is Groundhog Day. In it, Bill Murray plays a TV reporter who wakes up each day to find it’s the same day he just lived. In Chichester’s case each day represents a new legislative session, yet his “answer” is always the same. More taxes.
This time the Senator and his groupies demand that the sales tax be applied to gas – an increase of five cents on every dollar, not gallon, spent on gas. If he doesn’t get his way, he will take his marbles (his vote and that of others) and go home. While most agree that the Commonwealth needs to dedicate more resources to transportation, Chichester’s latest move killed a compromise plan that was generated in the House with bi-partisan support. While not perfect, the House compromise plan would have gotten much needed dollars flowing into new projects and would have taken the Commonwealth one step closer to solving its transportation challenges.
While Chichester argues that the Commonwealth is in dire need of more money for roads, he balks at any plan that isn’t his and has openly criticized members of the General Assembly for standing in the way of progress. It’s either his way, or no new highways for the Commonwealth. Who is standing in the way of progress now?
Sadly, Chichester’s plans always fall back to more taxes despite state surpluses worth several billion dollars over the past few years. Chichester argues that General Fund surplus dollars should not be spent on transportation. He has argued that these funds need to be protected for education, public safety and other social services.
This line of argument is disingenuous. It suggests that these programs have not been fully funded or have even faced cuts. The reality is the General Fund budget has been growing at staggering rates – they’ve been fully funded each and every year. Indeed, Senator Chichester made sure of that just a few years ago when he crammed the state’s largest tax increase down our throats. Ever since, the Commonwealth has enjoyed significant surpluses.
As these vital programs have been fully funded, the General Assembly has been left with two choices – either refund the taxpayers the difference or transfer the revenues into other priority program areas. Given the Senators’ penchant for spending, we can throw out the refund option, so you’d think it would be OK to shift surplus dollars into transportation efforts. Sadly, this option isn’t acceptable to Sen. Chichester, and we’re left with either new taxes or no new funds for transportation.
Essentially, the Senator is saying is that every dollar currently spent by the Commonwealth is already appropriated to its best use. His actions also suggest that protecting, and securing additional funding, for those programs is a higher priority than new transportation funding. Unless of course, the plan is “to look in other people’s pockets,” and increase taxes to confront the transportation crisis.
New roads won’t be built overnight. Despite all the political positioning there likely won’t be too many ribbon-cutting ceremonies this year or even next. This is especially true if vital VDOT reforms to streamline and expedite the planning, engineering and environmental analysis are not completed. VDOT reform is a central piece of the House plan – the compromise plan signed off on by many of Senator Chichester’s own Republican “moderates.”
Furthermore, while the vast majority of transportation projects around the country continue to be funded from traditional sources, a new funding and operational paradigm has emerged. Increasingly, state and local transportation agencies are looking to supplement their own resources with private investment and operations.
Indeed, the private sector has demonstrated its ability to get new infrastructure built faster and cheaper when its own capital is at risk – or when there are sufficient incentives for speedy delivery. Again, private sector investment and operation is a critical component of the House plan.
Perhaps Chichester should study how Texas has been able to embark on an ambitious and aggressive transportation building frenzy without raising taxes. Indeed, that state has made it an explicit policy to embrace the changing funding paradigm and invite the private sector to build and operate new roads.
This has enabled Texas to ensure that roads are built quickly and efficiently, and stretch its own limited resources without reaching back into the public’s pockets.
Chichester’s reliance on new taxes flies in the face of how transportation is increasingly financed in the U.S. After three years of debate and discussion a reasonable compromise was hammered out. Now “King John” has killed it because he didn’t get his way. His willingness to halt progress threatens the long-term fiscal health and economic competitiveness of the Commonwealth.
Geoffrey F. Segal is the director of government reform at Reason Foundation. This column was originally written for Bacon’s Rebellion. An archive of Segal’s work is available here and Reason’s transportation research and commentary is here.