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Virginia should

those revenues may be insufficient to keep up

that northern Virginia sends to Richmond,

with growing transportation demands. A

the region gets back only 46 cents in state

begin using more

aid.20 His calculations show that in 2000

first step toward a solution would be to

current general

change priorities in order to devote more

northern Virginians paid about 39 percent of

fund revenues to

state transportation funds to faster growing

state taxes, but local governments in north-

regions, rather than divert money to slow-

ern Virginia received just 18 percent of all

help finance roads

growth regions. Indeed, the state auditor

state aid. Thus, it is unfair to ask taxpayers in

and highways.

recently recommended that the state change

northern Virginia to pay more for improved

the current method of regional allocations of

highways when the state already siphons off

transportation funds to better fulfill

their tax payments to other parts of the state.

statewide priorities.18

Further evidence of the state budget's

In addition, the state should begin using

unfairness to northern Virginia is the fact that

more current general fund revenues to help

the region's population is 26 percent of the

finance roads and highways. The state has

state total, but it pays about 39 percent of

started using small amounts of general fund

Virginia's taxes. Fairfax County alone pays 27

revenues for transportation through the

percent of state income taxes but has just 14

percent of the state's population.21 The state

Priority Transportation Fund in recent years,

and this policy should be expanded upon.

income tax penalizes residents of northern

Unfortunately, the 2003 budget goes in a

Virginia, where both incomes and living

reverse direction by raiding $317 million of

expenses are high. Also, as capital gains tax rev-

transportation monies to fill the general

enue soared in the 1990s, this extra state cash

fund budget gap, instead of cutting general

intake came at the expense of the high-tech

fund spending.

industry concentrated in northern Virginia.

Since Virginia's operating budget totaled

Northern Virginians should seek a more equal

more than $23 billion in 2002, 7 percent

share of the state budget to help solve the

planned spending growth in 2003 means a

region's transportation problems, rather than

$1.6 billion increase. By contrast, the pro-

impose an additional burden on taxpayers.

posed sales tax increase in northern Virginia

6. New Sales Taxes May Cause the State to

would raise about $123 million in the first

year.19 Thus, trimming less than 1 percent of

Redistribute the Transportation Budget

annual growth in the overall budget would

A big danger of targeted sales tax increas-

be enough to fund added transportation

es in two regions of the state is that it is like-

needs without a tax increase. In the policy

ly that the legislature will reduce what would

options section below, we detail how the

have otherwise been spent on transportation

excess annual growth in the general fund

in northern Virginia and Hampton Roads in

would obviate the need for a sales tax

future years. State transportation money

increase by providing funds for transporta-

could be directed to other parts of the state,

tion improvements, as well as room for

or even to nontransportation uses. Other

future tax reductions.

regions may well argue in the future that

northern Virginia and Hampton Roads have

5. The State Budget Is Already Unfair to

more than enough transportation funds and

Northern Virginia

that state money should be spent elsewhere.

The current structure of the Virginia bud-

Some state leaders are already telling their

get creates an unfair fiscal balance for north-

constituents outside the referenda regions to

ern Virginia. Northern Virginia gets the short

hope the referenda pass because that will free

end of the stick when it comes to state aid

more state money for them. Virginia secre-

and  transfers  to  local  governments.

tary of transportation Whitt Clement told a

According to professor John Knapp of the

crowd in Danville on May 2 that "money

University of Virginia, for every dollar in taxes

from the sales tax referenda will finance

6