Tax Hike or No Hike?

Tax Hike or No Hike?

Local leaders debate sales-tax referendum.

For opponents of the proposed half-cent sales tax, the transportation referendum leaves too many unanswered questions and does not solve Northern Virginia’s transportation problems.

But for proponents, “the time is now to invest in those infrastructure improvements,” said Leonard “Hobie” Mitchel, member of the Commonwealth Transportation Board and president of Lansdowne Community Development LLC. The referendum, which provides funds for highway, rail and transit projects in Northern Virginia, is not a final solution, “but a first step,” he said. “These things are needed today, not in five years, not in 10 years. …The first thing that needs to be done is to maintain the infrastructure we have.”

Mitchel and W. Tayloe Murphy Jr., secretary of the Department of Natural Resources, spoke in favor of the referendum at the Oct. 10 community forum sponsored by the League of Women Voters of Loudoun County. Opposing the referendum were Stewart Schwartz, executive director of the Coalition for Smarter Growth and Mark Tate, a director of the Loudoun Taxpayer Coalition and vice mayor of Middleburg.

THE REFERENDUM, which will increase the sales tax from 4.5 cents to 5 cents if passed, is expected to raise $5 billion in 20 years for regional transportation projects. The revenues from the tax will be used to pay the debt service on $2.8 million in transportation bonds, leaving $2.2 million for pay-as-you-go projects. The Northern Virginia Transportation Authority will adopt a six-year plan, deciding on the priorities for projects paid through both methods. Ninety-seven percent of the tax’s funds will be spent on improving existing infrastructure, leaving 3 percent for new projects.

In Loudoun, the referendum is expected to provide $251 million for transportation projects and $100 million to improve Route 7, along with another $350 million for Dulles corridor transit with Loudoun’s share ranging between $63 million to $80 million. The funding will be based on population numbers, leaving Loudoun with about 10 percent to 12 percent of the funds, Mitchel said.

Regionally, 41 percent of the referendum’s funds will be dedicated to transit projects, which will help reduce congestion and improve air quality, Mitchel said. “Transit is going to be the wave of the future, and this referendum package starts to deal with it,” he said.

“You’re darn right I want to solve traffic congestion. This won’t do it,” Schwartz said. “It’s not about transportation. It’s about land use and development,” he said, adding that despite the number of roads in Northern Virginia, the region “still has traffic problems. … We’re not going to solve traffic by widening roads, but with land use.”

Murphy disagreed. “I don’t think these projects promote sprawl,” he said, adding that transit will help reduce the number of vehicles on the region’s roadways. The projects “direct growth in appropriate areas … and add capacity to deal with growth,” he said.

TATE SPOKE AGAINST the idea of raising taxes as a solution to the region’s transportation problems, calling the referendum an “easy out for politicians.”

“Raising taxes stifles economic growth,” he said. “The real question is, are we already paying too much in taxes?”

The region does not receive its “fair share” from the taxes paid to the state, Tate said. He supported the idea of allowing the region to raise its own taxes and build its own roads, allotting 1 percent of the state income tax for a road fund. “Raising taxes is not the best policy,” he said.

Murphy said taking 1 percent out of the income tax would mean cuts for other programs already supported by the tax.

“I don’t see any alternative resources,” Mitchel said, mentioning the nearly $2 billion budget shortfall the state is facing and the fact that the projects are not included in the Virginia Department of Transportation’s six-year plan.

Schwartz questioned the need for transportation projects funded by the referendum, adding that the projects have not been tested nor the costs determined. “We don’t know where that money is going and where the priorities are,” he said. “We don’t know what this will cost in maintenance.”

“The cost of maintenance projects are in here,” Mitchel said. “I don’t need any statistics to tell me there’s a need.”