Billions today, gone tomorrow
Mr. McDonnell proposes a big stopgap for Virginia roads.
GOV. ROBERT F. MCDONNELL (R) has unveiled a transportation plan that will yield several billion dollars for new roads, rails and bridges over the next three years, provide a jolt of new employment, and kick-start several hundred stalled projects, including more than 100 in Northern Virginia. It is a creditable, badly needed boost for a crumbling transportation network. It is also woefully inadequate.
The main problem is that it fails to achieve what the governor has repeatedly said is necessary: to establish an ongoing, sustainable and long-term source of revenue to address Virginia’s most critical problem. He has acknowledged the glaring shortcoming of his plan, that it provides plenty of dollars in the short term but very little after that. In essence, it is a $2.9 billion stopgap that would rush money out the door today but leave Mr. McDonnell’s successor, who takes office in 2014, with virtually no transportation funding options.
A chart by state analysts makes the problem crystal clear. It shows that the centerpiece of Mr. McDonnell’s plan — the accelerated sale of state revenue bonds — would provide $600 million in each of the coming three years, starting now. That $1.8 billion is certainly a good thing, and the governor makes a good argument when he says it is well timed to take advantage of low interest rates on the debt the state would incur and low bids from contractors starved for business.
But in the four years after the governor has left office the state will have reached the limit of its ability to borrow money and pay service on that debt. According to the state chart, Mr. McDonnell’s successor would be able to borrow just $450 million over the entire length of his term — a pittance given the tens of billions in transportation construction funding needed statewide.
The other main feature of the governor’s program is to shift $140 million from the general fund — read: education; public safety; and health and social programs — for transportation projects in Northern Virginia and Hampton Roads. Even if one agrees with Mr. McDonnell, who argues that that is sound policy — and we have our doubts — it’s not likely to gain approval in the state Senate, which is controlled by Democrats.
Unsurprisingly, the governor’s proposals have been hailed by business groups and contractors. But even many of them say that an approach of feast today, famine tomorrow is not good enough. Some of Mr. McDonnell’s own aides and allies believe— or rather hope— that by acknowledging that his program is just a beginning, he has set the stage for proposing permanent new transportation revenue next year, meaning a tax increase.
That would be a break from Republican orthodoxy and a departure from his own pledges not to raise taxes. But as the governor has implied by his own remarks — “Much more must be done,” he said last month — there is simply no other option if Virginia is going to fix its broken road system in the long term.