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Posted at 2:55 PM ET, 01/ 6/2011

NoVa Republicans propose plan to fund transportation

By Anita Kumar and Rosalind S. Helderman

A trio of moderate Republican legislators from Northern Virginia has proposed taxing out-of-state corporations that sell services in Virginia as a way to raise up to $200 million for the state's traffic-clogged roads.

Dels. David B. Albo, Thomas Davis Rust and Joe T. May consider their bill, which is expected to be introduced Friday, a compromise that could pass both the Republican-controlled House and Democrat-led Senate.

Out-of-state corporations that could be taxed include law firms, computer programming companies and those that provide Web site design services. Most other states, including Maryland, already tax those corporations.

Albo sent the proposal to his Republican colleagues in the House Wednesday with a note explaining that it is not a tax increase.

"This is not a tax increase on Virginians,'' Albo said. "They've got to vote for this. I can get 51 votes in the House and I'll get every reasonable Republican."

But some conservatives will consider taxing corporations that are currently not taxed a tax increase.

Ben Marchi, state director for Americans for Prosperity, said the proposal will reduce the state's competitive edge and put Virginia's transportation problems on non-Virginians.

"This is a disgusting display of arrogance from tone-deaf politicians who clearly did not hear the voters this past November,'' Marchi said.

Senate Majority Leader Richard Saslaw (D-Fairfax), who had not yet seen the proposal, predicted it would receive a chilly reception from the Republicans' conservative colleagues.

"I'd be shocked if they got it out House," Saslaw said.

And if they did?

"I'd have to take a look at the whole thing," he said.

Virginia has struggled over where to find money for its infrastructure, with Democrats and Republicans at odds over raising taxes or finding other ways to raise money. The state's transportation budget shortfall, in the billions, has led to thousands of job cuts and hundreds of unfinished projects.

Albo got the idea for the bill from a recent study of Virginia's corporate income tax by the General Assembly's investigative arm, the Joint Legislative Audit and Review Commission. The group estimated the state could collect as much as $250 million more each year if it applied the corporate income tax to out-of-state businesses that sell services in Virginia.

"This is nirvana,'' Albo said. "I can't believe this plopped in our lap."

The study noted that many other states, including some of Virginia's competitors, tax such businesses and that failing to tax the out-of-state businesses might actually create a disincentive for such corporations to open physical offices in Virginia and hire workers in the state.

Extending the tax to out-of-state corporations was among a series of options for changes to the state's corporate income tax structure that JLARC suggested for legislative review.

By Anita Kumar and Rosalind S. Helderman  | January 6, 2011; 2:55 PM ET
Categories:  Anita Kumar, General Assembly 2011, House of Delegates, Rosalind Helderman, State Senate  
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So the best solutions these three clowns can come up with is confiscate more loot from the employers of their constituents...

I have a better idea than a tax on those who make the livelihoods of Virginians possible....

I say we cut back Federal Government employment by 10% across the board and consider moving many smaller agencies and departments outside the Washington D.C. metro area to places like Centerville or Manassas or even out to Leesburg or Winchester so the traffic will be on less congested arteries closer to the people who work in those departments and agencies. Cost of office space will be far less than near or inside the beltway. The commutes will be shorter as well because the reduced traffic flows will still be mostly toward the metro area rather than away from it. Since this solution will take some time to occur, and since government employees and those who serve the government make up a bulk of the traffic that is causing the congestion, stagger work schedules by an hour or two and try to set up telecommuting as a option a couple of times a week to save fuel and to reduce traffic for those employees who's physical presence is not critical to their jobs.

The fact that the only solution three politicians could come up with was to raise taxes should come as no surprise. Politicians, for some reason, lack imagination, vision and reason. They will for lack of the aforementioned attributes, default to the basest of solutions: take more and more money from the people, and call that a progressive and fair way to deal with the traffic situation. They are under the illusion that given enough money, any problem can be fixed. All I can say is: How pathetic, and how typical.

Posted by: Tboltaq2 | January 6, 2011 6:03 PM | Report abuse

Thank you. Enjoyed the latest post on Transportation.

We need to build rail. Even the Governor wrote last March 25, 2010 in the Washington Post with 5 other governors for rail.

"Every dollar invested in building rail creates $25 dollars in economic and environmental benefit". $4 billion times 25 is $100 billion in benefit for Virginia by building rail..."

Other good news tonight..

...A couple of our Indy Green Party candidates Miriam Gennari, and Jim Huryz in Virginia have been selected among the bests in the blog world..

Here's the story at our new Independent Green party Blog..

Posted by: CareyCampbell | January 7, 2011 12:47 AM | Report abuse

Read the article again. The tax applies to out of state companies doing business in Virginia, not companies that are already in Virginia. If they are out of state, they are not employing Virginians. You're argument has no merit.

We both know that your plan to cut federal workforce 10% and move agencies to Winchester won't happen, that's not even a serious solution.

Last I checked, government has an obligation to fund transportation, but the Virginia state government has abused the system for too long in that they funding formulas are completey backwards. I blame the down state politicians that pander to their own constituents and neglect the economic engine tha drives this state, NOVA. Remove NOVA and you are basically left with Arkansas.

Posted by: iluvnova | January 7, 2011 8:55 AM | Report abuse

A tax increase is a tax increase! Increased taxes are passed on to the end user by corporations so ultimately this burden will be passed on to Virginians in the form of increased cost.

Posted by: jnowlin2 | January 8, 2011 6:55 AM | Report abuse

A tax increase is a tax increase! Increased taxes are passed on to the end user by corporations so ultimately this burden will be passed on to Virginians in the form of increased cost.

Posted by: jnowlin2 | January 8, 2011 6:59 AM | Report abuse

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