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Stumping for Sales Tax Referendum

Tax Would Aid Transportation, Economic Growth

William A. Klene, owner of William A. Klene Architects in Chantilly, came to the Committee for Dulles' General Assembly preview luncheon Oct. 17 hoping to hear half a dozen legislators discuss the financial situation facing the state.

Instead, three delegates attended the luncheon to mostly push for the sale-tax referendum, which will be part of the Nov. 5 general election ballot.

"I had a lot of aspirations to hear what the legislators hope to do to sum out our serious budget situation," Klene said. "I heard what I wanted, partially, yes."

Klene did have the opportunity to ask a question about the efficiency of the Virginia Department of Transportation.

Nearly 70 people gathered at the Hilton-Washington Dulles Airport to hear Dels. Vincent Callahan (R-34), John "Jack" Rollison (R-52) and Thomas Rust (R-86) discuss future transportation issues and the benefits that could be gained by passing the sales-tax referendum, which, if passed, would raise the sales tax a half cent in Northern Virginia to be used for local transportation projects.

Robert Whitfield, a real estate agent with Weichert Realtors in Dulles, said he has several issues he would like to see the General Assembly address, but he came to the luncheon specifically to hear about the transportation referendum.

"I see this as the primary issue for Northern Virginia, so the more information, the better," he said. "I think it is an essential investment for our future local economy because the population continues to grow. We have to build just to keep up with the net increase in population."

Sen. Mary Margaret Whipple (D-31), and Dels. Robert Marshall (R-13) and Gary Reese (R-67) had also been expected to also attend, however, the trio never made it to the event.

CALLAHAN told the crowd that the budget is made up of two components: the general fund and the nongeneral fund. It's the nongeneral fund that is made up of dedicated monies that "can't be touched," he said, "it is actually holding up pretty well."

It is the general fund where the Assembly is facing what could be a deficit in the $1.5 billion to $2 billion range. He said the General Assembly "fixed" the deficit in last year's budget. The latest shortfall, he said, was the result of Gov. Mark Warner (D) wrongly estimating revenue figures. The governor has the power to cut the budget up to 15 percent to close the gap, but anything beyond that has to come from the General Assembly.

"Off the table temporarily is state aid to education, Medicaid, the car tax," Callahan said. "All these people are arguing over the piddly half-cents sales tax. ... Of course, we are spending money frivolously on things like education and higher education. There is a rainy day fund and we’re using it now."

Callahan said the argument against the sales tax that it is a regressive tax is false. He said the law is specific, limiting the expenditures to the Northern Virginia area. He also said the argument that the additional funds will result in less state funding in general is also incorrect.

"We have too much power up here to allow that to happen," Callahan said.

PRINCE WILLIAM COUNTY representative Rollison said that if someone looked at all the transportation projects in the planning stages, they would see they all lead to Dulles Airport.

"We've made significant efforts to fuel what will be the economic engine of the region. In order for us to do that, we have to work together," Rollison said.

He said the anticipated $140 million per year in additional sales-tax revenue will be "spent strictly in Northern Virginia and the projects will be decided by Northern Virginia.

"In my opinion, the economic viability depends on improving the transportation system," Rollison said.

The delegate said he has heard from businesses in his area that they are having a hard time recruiting people to come to the Northern Virginia area because of the traffic situation.

"[An independent report said] we have the third worse traffic in the United States, second only to San Francisco and Los Angles," Rollison said. "And we're the worse on the East Coast, even worse that Chicago or New York."

RUST, WHILE doing his part to stump for the referendum, also addressed some other issues facing the General Assembly. He said he has been told the governor plans to make the Potomac River crossing study a priority. He also said he has submitted a bill to change the transportation funding formula, "it's a fairness factor," he said. "It hasn't been changed in 20 years and it doesn't reflect changes."

He also spoke in favor of the $900 million bond referendum for higher education, and the state park bond referendum, both also on the Nov. 5 ballot. He also said the resources available to the Assembly do not match the need and at some point there has to be a debate to decide the priorities and what the Assembly can actually afford.

"There needs to be a serious debate on the whole tax issue. I think local government is being forced to put too much on their backs," Rust said. "There needs to be other sources of revenue for local government."

However, both Callahan and Rust said the decision has already been made not to address restructuring the tax system this year and neither is hopeful for the future.

"I don't expect any positive results [from the committee studying the issue]. One of the rules was to make it revenue neutral, which doesn't address the problem," Callahan said.

"One of the reasons given for not doing it this year is that it's an election year. Next year is an election year and the year after that is an election year," Rust said. "We are going to need to step up."