McDonnell wants to increase portion of sales tax going to roads

Gov. Bob McDonnell wants to incrementally increase the portion of the state sales tax that is dedicated to transportation to .75 from .5 over the next eight years, starting with a hike to .55 percent for the upcoming two-year budget, to generate an estimated $110 million in new transportation funding for maintenance.

McDonnell announced that proposal in Norfolk today while unveiling his transportation plan for the upcoming 2012 General Assembly session. He spoke to about 700 industry professionals gathered for the 2011 Governor's Transportation Conference.

He also wants to increase to 75 percent the share of year-end surpluses diverted to transportation, dedicate portions of tax revenue growth attributable to transportation infrastructure projects back to transportation, and dedicate to transportation the first 1 percent in revenue growth over 5 percent each year.

According to his plan, he'll also seek to create an I-85 Connector Economic Development and Promotion Zone to encourage businesses to invest here and use state ports.

He was interrupted at the onset of his remarks by protesters who appeared to represent a local Occupy movement. McDonnell responded to the protesters, telling the audience that everyone should have a voice in our democracy and be heard.

Tucker Martin, McDonnell's spokesman, said about seven people were escorted out and the program continued.

The governor plans to announce additional proposals and more details of his transportation package in the next month.

He presents his budget to the legislature's money committees on Dec. 19.

2012 Transportation Plan Highlights

The governor's proposed transportation plan for 2012 includes the following revenue-enhancements and policies to promote transportation investment:

· Increasing transportation's share of year-end surpluses to 75 percent. This measure will provide transportation with additional revenues without jeopardizing other key areas of need. Over the past 2 years, $100 million in surplus has been sent to transportation.

· Authorizing the Commonwealth Transportation Board to implement a version of tax-increment financing. When the state funds a major new piece of transportation infrastructure, transportation should receive a portion of the growth in state tax revenues that result from economic development surrounding the project. These revenues will be reinvested in additional projects that can help spur additional development.

· Increasing the dedicated transportation allocation of the sales tax from .5 percent to .75 percent over the next 8 years. During the upcoming budget, increasing the dedicated sales tax percentage to .55 percent generating over $110 million in new transportation funding going to maintenance

· Proposing that the first 1 percent in revenue growth over 5 percent each year be dedicated to transportation

· Expanding VDOT's Revenue Sharing Program to include maintenance. Currently, the state will match local money dollar-for-dollar on capital improvements within a locality. Enabling maintenance projects to be eligible for this program will help make our maintenance dollars go farther.

· Legislation to restructure and fund the Virginia Commercial Space Flight Authority and turn it into a true independent agency to develop the Mid-Atlantic Regional Spaceport into the number one commercial space flight facility in the nation

· Legislation to promote the Port of Virginia by eliminating some of the bureaucratic processes with which the Virginia Port Authority must comply and creating the I-85 Connector Economic Development and Promotion Zone, wherein companies shipping goods through the port or engaged in maritime commerce can operate income tax free for their first two years in operation