Posts Tagged ‘gasoline taxes’

Proposed Virginia Gas Tax Hike Would Benefit Rail

January 28, 2020

Virginia Gov. Ralph Northam has proposed an increase in gasoline taxes to help pay for an ambitious expansion of rail passenger service.

The increase of 4 cents per gallon would raise revenue for an expansion of track capacity that in turn would lead the way to increase service provided by Virginia Railway Express and Amtrak.

Northam made the proposal during a speech before a joint session of the Virginia legislature.

Earlier the state had announced that it has reached an agreement with Amtrak and CSX on a $3.7 billion program that includes a new bridge over the Potomac River to Washington and the acquisition for $525 million of 225 miles of track and 350 miles of railroad right of way from CSX.

Other components of the plan include a fourth mainline track between Crystal City and Alexandria, a third track from Franconia to Lorton, six new passing sidings, and a Franconia-to-Springfield bypass that would be used by passenger trains.

The program would be implemented over a 10-year period.

The gas tax increase, which is expected to yield $1 billion over the next four years, was among the transportation initiatives in a proposal Northam released on Monday.

Transportation Secretary Shannon Valentine has said that without a gas tax increase or other new funding source the state projects a drop in funding available for road construction and other projects.

“Virginia’s transportation [funding] system is simply not sustainable the way we are going,” Valentine said.

She said that in the long term the statement might need to rely on tolls or other fees tied to the number of miles driven or the type of roads that motorists use.

However, Valentine said those fees are at least a decade away.

Virginia’s gasoline tax is currently 16.2 cents per gallon although motorist in some regions of the state pay an average of 21.9 cents.

“I think there’s going to be some challenging discussions and decisions and perhaps how we look at our multimodal platform,” Valentine said.

“The consensus seems to be that over the next 10-15 years, there will most likely be a different way of raising major transportation revenues, whether it’s from a mileage based user fee, vehicle miles traveled, there will be some different form. That is a longer term perspective.”

The Washington Post reported that Northam’s gas tax proposal will also be used for an effort to lower traffic fatalities on state highways and ensuring the state’s transportation fund remains solvent to support critical transit, including Washington Metro, and infrastructure projects.

“Our legislation will make our roads safer. It will put in place sustainable streamlined transportation funding, it will improve transit, it will help fix our roads and bridges, and expand passenger and commuter rail service throughout Virginia,” Northam said at a news conference.

A number of proposals to lower the gasoline tax in recent years have failed and former Gov. Robert F. McDonnell in 2013 proposed eliminating the tax. Instead the legislature lowered it.

The number of miles being driven by motorists in Virginia has been increasing, but gasoline tax receipts have fallen due to more fuel-efficient vehicles.

The Institute on Taxation and Economic Policy has said 31 states have increased or changed their gasoline taxes in the past 10 years with 22 states imposing variable rate gas taxes as a hedge against inflation.

The Northam transportation proposal also would create a new rail authority, the Virginia Passenger Rail Authority, and authorize the sale of bonds backed by toll revenue collected on Interstate 66 inside the Capital Beltway.

The new authority would have a mandate to manage the purchase and ownership of track the state plans to buy from CSX.

It will also “promote, sustain, and expand the availability of passenger and commuter rail service in the Commonwealth.”

The gas tax increase, if approved by lawmakers, would take effect July 1.