Tamara Rollison 804-786-2715

Jan. 16, 2013

Package brings sustainable source of revenue to skyrocketing transportation needs

RICHMOND – Gov. Bob McDonnell addressed the Commonwealth Transportation Board (CTB) meeting today about his plan to pump more than $3.1 billion in transportation funding for the commonwealth over the next five years.

“I have presented a solution to help fund the growing transportation needs of the commonwealth by replacing the state’s outdated gas tax with a 0.8 cent increase in the state’s sales tax to be dedicated to transportation.  This eliminates the gas tax altogether, making Virginia the first state in the nation to do so.  The state sales tax is a proven revenue source that will provide a significant sustainable funding source for transportation over the long term. Relying on the state gas tax will only make the funding situation worse because the gas tax buying power has greatly depleted over the years.  Switching to the state sales tax is the reasonable and logical solution to fund projects.”

CTB member Aubrey L. Layne, who represents Hampton Roads, said, “The board’s job is to allocate shrinking transportation dollars to immense transportation needs.  This is an incredible challenge that cannot be met unless we have a reliable and sustainable source of funding, which can be met by replacing the state gas tax with the state sales tax. The McDonnell administration has resolved immediate transportation needs, but we must move from the immediate to the long-term so critical projects that will increase capacity and ease congestion get built.  Right now, we have only enough state funding to maintain what we have, with little left for capacity improvements.”

“The commonwealth needs bold solutions to meet funding needs for transportation,” added CTB member Gary Garzynski who represents Northern Virginia. “The governor presents a bold plan using the state sales tax, which is a much more reliable revenue source than the gas tax, to provide better roads and public transportation for highly congested areas as well as for transportation improvements statewide.”  

CTB member Mark J. Peake, who represents Lynchburg, said, “I am looking forward to the passage of the governor’s proposal so the CTB has a sustainable funding source to work with to advance much needed transportation projects in urban and rural regions of Virginia.”

The governor’s transportation package includes:

  • Eliminate the current 17.5 cents per gallon motor fuels tax on gasoline – This tax will continue to lose buying power and value because cars are getting better gas mileage and there will be an increased use of alternative fuel vehicles.  This means less money in the state gas tax will be collected at the pump over the long-term.

  • Replace the current gas tax with a 0.8 cent increase to the sales and use tax – This is a reliable, predictable and sustainable revenue source.  Taxpayers will get more buying power out of this, resulting in more transportation improvements.

  • Dedicate an additional 25 cents of the states portion to the existing sales and use tax to transportation

  • Increase vehicle registration fees by $15 and dedicate the revenue to intercity passenger rail and transit.

  • Impose a $100 annual Alterative Fuel Vehicle Fee and dedicate revenues to transit.

  • Adopt the Marketplace Equity Act now and dedicated projected revenues to transportation and education.  

Appointed by the governor, the 17-member CTB establishes the administrative policies for Virginia's transportation system.

The CTB allocates highway funding to specific projects, locates routes and provides funding for airports, seaports and public transportation.


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Page last modified: Nov. 6, 2017