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Highway robbery / October 08, 2009
If a candidate for statewide office promised to extract revenue from southern Virginia to build roads for northern Virginia, would you vote for said candidate?


OK, let’s try this one: A candidate for governor pledges to pay for transportation by raiding the budget for education, law enforcement, health care and other priorities. Of course, our candidate doesn’t exactly put it this way, preferring to prettify matters by claiming ample revenue will flow into the state’s coffers to cover future non-transportation needs. Our candidate makes this argument even though the state has been forced to cut $7 billion from the budget in just the past two years.

Who is this person? You might know him more for his retrograde views on working women and family life than for his smoke-and-mirrors plans for (mis)managing Virginia’s affairs. But should he indeed rise to the office of governor for the next four years, there’s no question which aspect of this candidate’s program would inflict the greatest lasting damage on the Commonwealth.

Meet Bob McDonnell, Virginia’s would-be king of voodoo economics.

McDonnell has worked doggedly in the governor’s race — with some success, I’m afraid — to position himself as the pragmatic, solutions-oriented candidate. Unfortunately, the quantity of McDonnell’s position papers doesn’t amount to much in terms of quality. McDonnell’s self-styled “pragmatism” mostly consists of taking money away from existing needs to pay for things he’d like to convince the voters he has a plan for, like transportation.

Only that’s not quite the sum of it: McDonnell does have some ideas for raising new revenue. These fall into two basic categories: (1) Ain’t gonna happen and (2) never would be contemplated in a better world. Taking the second category first, McDonnell proposes to raise money for roads by tolling Interstates 85 and 95 at the Virginia-Carolina border. Oddy, the candidate has offered no such plans for erecting toll booths on interstate highways in Northern Virginia, Hampton Roads, Richmond, Roanoke or anywhere else in the Old Dominion. Is McDonnell worried that voter-heavy areas of the state might take exception?

It doesn’t take a poli-sci degree to figure out why Southside residents would stand alone in being asked to plunk our quarters into interstate toll booths: We’re easy pickins! Of course, there’s a case for drumming up transportation cash with tolls — a decent share of the revenue would come from out-of-state motorists — but don’t outsiders cross into Virginia from the west and north, too? I expect defenders of McDonnell’s plan will point out that rural southern Virginia drivers can always bypass interstate tolls by taking the back roads for the various trips they need to make to the Tarheel State. The slogan almost writes itself: Southside Virginia, where everyone is a secondary (road) citizen!

McDonnell also proposes to pay for transit projects by drilling for offshore oil and gas and selling off Virginia’s ABC stores. Drilling is little more than a chimera: Virginia doesn’t even own the lease rights to its offshore petroleum reserves, which may or may not in fact amount to much, and it would take years before significant sums of money were realized even if everything went according to plan, which never, ever happens with ventures as speculative as oil drilling. Virginia’s publicly-run liquor stores are a different matter, but a one-off sale to private operators might raise $500 million under the rosiest scenario, enough perhaps to pay for a couple of I-395 lanes into Washington, D.C. Virginia’s backlog of transportation needs has been estimated at $105 billion over the next 16 years. And we’re supposed to get excited about an asset sale that would raise half of one-percent of the needed cash?

McDonnell doesn’t talk much about a likely downside of ABC privatization: rising alcohol sales and consumption. Needing all the moolah it can lay its hands on, the state treasury would benefit mightily from aggressive marketing and advertising of booze that private outfits no doubt will be happy to provide. Which is better suited to sell the maximum amount of vodka, the corner ABC store or Wal-Mart? McDonnell also doesn’t identify a replacement for ABC profits once he hoovers up every last penny for transportation. Currently, ABC proceeds support substance abuse programs in the Commonwealth. Will substance abuse counseling no longer be needed after liquor sales are privatized?

McDonnell, in an interview with this newspaper back in August, defended his plans for more toll roads by noting that people don’t mind paying “user fees” for new roads. Whatever the merits of the argument, there is a very simple transportation user fee that’s already in place, is simple to administer and is shared fairly by everyone: the gas tax. Only one candidate in the race, Creigh Deeds, has acknowledged the reality that significant sums of real cash will be required to get Virginia’s transit system moving again. In that vein, some sort of tax increase is inevitable. (Deeds has conditioned his support for a gas tax hike on a bipartisan deal coming out of the General Assembly). Meanwhile, McDonnell traffics in candyland notions in an attempt to fool people into thinking they can have something for nothing. To paraphrase the immortal words of Ronald Reagan, McDonnell wants to toll you, he wants to toll me, but not the fellow who lives in area code 703.

McDonnell has identified one genuine source of money to pay for new roads: the state’s general fund. He is proposing to divert $150 million annually towards transportation, which is roughly 15 times the amount of money that the state expects to save by closing Brunswick Correctional Center. You don’t have to be a mathematician to figure out where the money would come from. Almost half of the state’s general fund is dedicated to K-12 education and Virginia’s world-class colleges and universities, with health care, law enforcement and other agency operations — everything from state parks to the Governor’s Opportunity Fund — making up the rest. Republicans in Richmond have waged a long-running campaign to roll back state education spending, and nothing would serve their cause more than adding transportation to the mix of priorities competing for scarce budget dollars.

This back-door funding raid would represent a sea change in the way Virginia does business — the state historically has relied on dedicated revenue to pay for roads — and it would be an outright disaster for the public schools. This is particularly true in areas such as our own where the majority of K-12 funding comes from the state. Not only do Southside counties lean heavily on Richmond for education funding, they receive extremely favorable terms: the distribution formulas favor poor localities, making our area the beneficiary of massive transfers of wealth from the state’s Golden Crescent. And what would happen if the money were rerouted into transportation? The landscape would shift. Which do you think is higher on the state’s priority list: new highways, tunnels and transit systems for Northern Virginia and Hampton Roads, or straightening out local country roads? By slicing and dicing the general fund as McDonnell intends to do, Southside would lose out, big-time.

The Washington Post ran a headline this weekend that summarizes perhaps the greatest challenge ahead for the state: “Va. Candidates Confront Schools’ Sinking Financial Future.” The accompanying article notes that Virginia ranks 37th in the nation in per-pupil spending despite avoiding the worst effects of worst economy since the Great Depression. Unless tax collections pick up again — and with housing in the dumps, business investment moribund, and consumers pulling back on their spending, where does the rebound come from? — schools face the prospect of crippling budget cuts over the next two years. In Halifax County, officials are predicting a $3.5 million hole in the school budget by 2012 unless things turn around. The challenge for the incoming governor, Virginia Board of Education President Mark E. Emblidge told The Post, is no less than “[h]ow to keep education from coming to a screeching halt.”

Deeds recognizes this fact, which is why he has ruled out any raid on the general fund to pay for transportation. Yet McDonnell not only waltzes around reality, he pushes a fairy-tale version of budgeting that would make George W. Bush proud. This passage from The Post piece says it all:

“Cutting your educational funding is like eating your seed corn,” Deeds said in an interview. His campaign and the teachers association have criticized McDonnell’s plans for funding transportation fixes through the general fund, nearly half of which goes to public schools.

McDonnell said in an interview that he did not expect his plan to divert funding from education because he expects the general fund to grow through economic development. He said he would protect education funding and work to push salaries for Virginia teachers to the national average. Deeds “thinks money is the answer to everything,” the former attorney general said.

And McDonnell evidently thinks money grows on trees and that hope is indeed a plan. Otherwise he wouldn’t suggest the future is so bright that Virginia can painlessly restore $7 billion in reductions over the past two years and find tens of billions of dollars for new spending on education, transportation and other needs. He has a better chance of riding into the Governor’s Mansion on a magic pony.

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