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Chamber wants state to fund highway improvements
Gas tax hike discussed as option

Friday, December 14, 2012

By MICKEY POWELL - Bulletin Staff Writer

Raising taxes on vehicle fuels seems to be the most logical way to raise funds for highway construction in Virginia, according to Martinsville-Henry County Chamber of Commerce officials.

The chamber, which represents the interests of area businesses, is calling for the state to generate revenue for highways. It is not yet endorsing any tax hike, but officials indicated that eventually may be considered.

Better highways would help trucks deliver materials and merchandise more easily, which in turn may help the community lure businesses and industries that would create new jobs, local economic developers have reasoned.

A state legislative agenda for 2013, adopted by the chamber’s board of directors Thursday, says the organization supports long-term solutions that would help Virginia overcome its transportation issues.

Based on comments by state Transportation Secretary Sean Connaughton, “we see ... there won’t be funds for new (highway) projects” after 2017 if a new funding source is not created, said chamber President Amanda Witt.

According to the legislative agenda, the chamber favors creating a “revenue stream to meet critical transportation needs,” and it is “not opposed to a user fee” being implemented to develop that stream as long as the revenues are distributed equally among all Virginia localities.

“We didn’t specify” what a user fee might be because “we’re not opposed to different types” of potential funding sources being considered, Witt said after the board meeting.

She said, though, toll roads and higher fuel taxes are options.

The agenda shows that the chamber wants to see U.S. 58’s widening to four lanes finished and construction on Interstate 73 started. Economic developers have said these projects should greatly help efforts to attract businesses and industries to the area.

“I’m not going to say we wouldn’t” support parts of either highway being a toll road to help fund construction projects, Witt said.

The chamber board has not discussed that.

But to create toll roads, the state would have to spend money to build toll booths and pay workers to collect the tolls, said Richard Eanes, president of Warren Trucking Co. and a member of the chamber’s government affairs committee.

A fuel tax increase would be more efficient because “it doesn’t cost any more ... to collect it at the pump,” Eanes said.

Witt said Virginia’s fuel taxes are among the lowest nationwide.

The website virginiagasprices.com shows that taxes on both gas and diesel fuel in Virginia generally amount to 17.5 cents a gallon. A petroleum storage tank fee of 0.6 cents a gallon is added to that, and some Northern Virginia localities impose an extra 2.1 percent in sales taxes on fuels.

Ten states have lower gas taxes, and 11 have lower diesel fuel taxes, than Virginia, the website shows. For both types of fuel, Georgia is lowest at 7.5 cents a gallon.

“We’re open to (considering endorsing) a user-based fee for any fuels used to move vehicles across the state’s highways,” Witt said of the chamber.

Eanes indicated that raising fuel taxes would be better than increasing other taxes or creating a new tax because fuel taxes are paid by anyone who buys gas or diesel fuel in Virginia, even if they do not live in the state.

Asked if she thinks area residents would favor higher fuel taxes, considering local economic problems such as high unemployment, Witt said “raising any type of tax is not popular,” but if the extra money would go toward road construction, “it would help with economic development efforts.”

“In this tough economy,” Eanes said, a fuel tax increase is “going to be a bitter pill” for anyone to swallow.

But “highways have got to be funded” somehow, he said.

The chamber board adopted a federal legislative agenda in addition to the state agenda. Both documents reveal the organization’s positions on many business-related issues in hopes that lawmakers will push those points.

Both show the chamber favors enacting health care laws that improve the quality of care while eliminating waste and abuse of government funds.

However, they show opposition to mandates requiring that businesses’ health insurance coverage for employees have certain benefits as well as ones “dictating that a percentage of health care costs be paid by businesses to their employees.”

Witt said some local businesses have told her they could not afford such mandates.

The agendas say the chamber wants to see continued funding for locally based workforce development programs.

The federal agenda shows the organization strongly opposes sequestration, the $1.2 trillion in spending cuts that would take effect Jan. 1 if Congress and President Obama cannot come to terms on a budget.

Sequestration would “have a devastating impact on an already struggling U.S. economy,” the agenda says. “More disturbing, however, is the impact that these cuts will have on economic growth in Virginia.”

Virginia, which borders Washington, D.C., depends on federal procurement and military spending so much that it is “particularly vulnerable to these budget reductions” and sequestration would “further dampen business investment and private sector hiring” statewide, the agenda says.

The chamber will hold a prelegislative breakfast at 8 a.m. Tuesday at the Virginia Museum of Natural History on Starling Avenue. Local lawmakers will discuss the General Assembly session that will start Jan. 9.

 

 
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