A grand compromise in the Virginia House and Senate ended the threat of I-95 tolls but raised the Commonwealth's sales tax, in an effort to fund nearly $1 billion for road repairs and construction.
In a 25-15 vote, the Senate paved the way for Virginia's first long-term transportation plan in 27 years. The vote Saturday wrapped up the 2013 session of the General Assembly, and sent a plan to Governor Bob McDonnell that both cuts and raises taxes.
The transportation plan eliminates Virginia's gas tax paid by consumers, and raises the Commonwealth's sales tax. Shoppers in Central Virginia will now pay a 5.3 percent sales tax, up from 5 percent. To put the tax in perspective, consumers purchasing a new $199 iPhone will now pay 60 cents more.
Local Senator Don McEachin says a slight boost in taxes is better than any boost in traffic.
"I think if anybody has travelled I-95 South, and gotten to Fredericksburg, and noticed you're still backed up all the way into Richmond, that's problem number one," says Senator McEachin.
Gas stations will now pay a 3.5 percent tax on the amount of gasoline purchased from refineries. Sellers of diesel fuel will also have to pay a 6 percent tax, a rate that will rise with inflation.
"If you want finger pointing, and blame... and no results, go to Washington," McDonnell said at a news conference Saturday. " If you want to see people who work together and get things done in a short amount of time... come to Richmond."
Residents in Northern Virginia and Hampton Roads will pay a higher sales tax rate, increasing from 5 to 6 percent.
The landmark transportation plan moved forward after the governor and legislators came to an agreement on expanding Medicaid in Virginia. If the federal government allows Virginia to enact reforms, families of four earning $32,000 or less could see more help paying for medical bills.
Governor McDonnell will sign the new legislation into law within the next 30 days.
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