Compromise transportation/land use bill emerges

General fund tapped; counties apparently not required to take over subdivision street maintenance

Although the legislation itself has not been released, it appears from information distributed at a Feb. 23 press conference that a compromise on transportation funding includes several provisions of interest to local governments. Speaker of the House William J. Howell and the members of the conference committee that reached the compromise on HB 3202 outlined it at the press conference.

Two primary details:

• The bill appears NOT to include the so-called "devolution" provision, so counties will not be required to take over the responsibility for new subdivision streets.
  
• Funding for the plan relies on significant levels of general fund transfers. About $180 million from the general fund will be used for debt payments, and another $150 million a year will be transferred from the general fund (the dedication of one-third of the insurance premiums) for road construction.
  

VML continues to oppose the annual transfer of general funds for transportation. The transportation funding problem requires dedicated, sustainable and ongoing funding from user fees including the gas tax and or motor vehicle sales and use tax.

Land use

Local subdivision streets

The state will continue to maintain all new subdivision roads that meet VDOT's new secondary street standards. The bill, however, requires VDOT to adopt regulations for new subdivision street standards in the next year. Additionally, the bill requires VDOT by Jan. 1, 2009, to re-assign roads based upon functional classifications (as opposed to the current administrative classification method). The results of these two reviews may alter the present maintenance and funding responsibilities.

Urban Development Areas (UDA)

Only those counties located in the Northern Virginia, Richmond-Petersburg, and Winchester Metropolitan Statistical Area (MSA) with a 15 percent or more population growth rate (from one 10-year census to the next) and a population of at least 20,000 must include one or more UDA in their comprehensive plan. (Affects Caroline, Chesterfield, Dinwiddie, Fairfax, Frederick, Hanover, Henrico, Loudoun, Louisa, Powhatan, Prince George, Prince William, Spotsylvania, Stafford and Warren counties.)

Urban Transportation Service Districts (UTSD)

Only authorized for counties with a population of more than 90,000 in 2000 that do not currently maintain their own roads. (Affects Chesterfield, Fairfax, Loudoun, Prince William, Spotsylvania and Stafford counties.)

• Counties that establish a UTSD will be required to assume maintenance of subdivision streets within the service district.
  
• Counties may impose an additional real estate tax within the UTSD to pay for road maintenance and construction.
  
• Only those counties that establish UTSD will have broad impact fee authority for most all public services, but:
  
  -- Impact fees may be imposed only outside of UTSD.
  
  -- Impact fees may be imposed only on parcels zoned for agriculture that are being subdivided for by-right residential development.
  
  -- Impact fees do not apply to "stale" residential zoning.
  
  

• Up to $180 million a year in General Funds to retire existing transportation debt and issue new project debt totaling $2.5 billion (20-year bonds)
  
  -- Bonds support road, transit and rail projects.
  

• Up to $200 million in new user fees to support Highway Maintenance. New fees include additional: $31.2 million in truck related charges (registration and weight enforced fines); $62.4 million in a new vehicle registration fee; and up to $80 million in Abusive Driver Fees.
  
  -- VDOT currently is transferring $450 million a year from construction to support maintenance: HB 3202 does not address this problem!
  

• In addition to the $180 million general funds for debt, another $64 million a year comes from the general fund surplus for the Transportation Trust Fund (TTF), and one-third of insurance premiums (currently in the general fund also will go to Transportation (approximately $150 million a year).
  

Regional funding plan

Hampton Roads: More than $200 million a year in new regional taxes and fees.

Northern Virginia: More than $425 million a year in new regional taxes and fees.

Impending actions

The General Assembly is expected to act on this new conference committee report Saturday, Feb. 24. As Friday (Feb. 23) came to a close, Gov. Tim Kaine said that if the bill passes the legislature, he is likely to amend it. If the measure fails, he will send down to the General Assembly a new bill.

Thanks to our colleagues at the Virginia Association of Counties for the compilation of this quick read of the conference committee actions. Please be aware that this summary comes to you PRIOR to the release of the actual legislation.

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