A July 29, 1999, article in the Washington Post identifies transportation as a "defining issue" in Virginia's fall elections. In Hampton Roads the front page of the July 9 Virginian-Pilot displays a large, eye-catching photograph of motionless minivans, SUV's, late model sports cars, trucks, and various other vehicles, all trapped in a traffic standstill. Over this colorful backdrop, a headline in large white letters reads, "Our Highway Dilemma." At the June 1 meeting of the Commission on the Future of Transportation in Virginia (COFT), Alson Smith, a former member of the General Assembly, expresses impatience with delays in widening Interstate-81, the scene of frequent deadly accidents and numerous traffic backups, and stresses the need for "a new sense of urgency" by the public. COFT member Senator Stanley Walker states, "We cannot stand a gridlock which is going to cripple this state." The transportation situation in Virginia may have reached the crisis stage.

In June the Commonwealth Transportation Board approved a six-year program with 1,126 projects worth $1.78 billion. Overall, the flow of revenues earmarked for transportation during the current fiscal year has been exceeding estimates by 2 percent. In terms of the numbers of projects and dollar value, David Gehr, former commissioner of the Virginia Department of Transportation (VDOT), described Virginia's transportation program as "strong" and "healthy." But during its June meeting, various members of the House Finance Committee expressed skepticism that the projects in Virginia's "Six-Year Program," an annually updated document that identifies projects to receive attention over the next six years, will proceed on schedule. One member produced a letter written by Katherine K. Hanley, chair of the Fairfax County Board of Supervisors, to Secretary of Transportation Shirley Ybarra. The board of supervisors, Hanley wrote, "is very distressed to note that several projects for which construction commitments have been made in the recent past are now being significantly delayed."

Among the meeting's spectators, most of them lobbyists from various organizations who have monitored state transportation issues for more than a decade, there is a sense that delays among competing transportation projects will continue and that there will never be enough money to pay for projects on everybody's wish list. But the legislative drama will continue. Many speeches have called for VDOT and other state transportation agencies to economize, reallocate, restructure, and reinvent themselves. And the governor himself has issued an order that VDOT be audited.

Governor Gilmore recently formed an additional high-level commission to study transportation issues: the Governor's Commission on Transportation Policy. At its inaugural meeting on June 29, Governor Gilmore directed the 21-member commission, comprised mostly of business leaders, to aspire toward "new 'outside-the-box' thinking" and to "question the traditional approach." It is now time, he said, "for reassessment of the way we do things." Proposing a gasoline tax increase, he said, is "the old way." He asked the commission to evaluate

• The consequences of Virginia's reliance on federal funds with all strings attached;
• Whether the construction of new lanes is always the most appro-priate answer for ameliorating transportation problems;
• The role of what he called "anti-growth" politics upon transportation;
• How to improve management and planning; and
• The role of long-term planning.

But will the questions of the future continue to replicate those of the past? Files and shelves bulge with past reports about estimated transportation needs, estimated transportation revenues, and idealistic prose about the need to reform transportation planning and more effectively link transportation planning with local land-use planning. Meanwhile, the growth in vehicle miles traveled on Virginia's highways continues to exceed all earlier expectations.

A growing line of commissions and studies

The establishment of the Governor's Commission on the Future of Transportation Policy is the fifth high- level statewide study specifically devoted to transportation issues since 1986. A fundamental finding of the first one, the Commission on the Future of Transportation for the 21st Century, known simply as COT-21, was that Virginia in 1986 had about $10 billion in identifiable transportation needs.¹ For the ensuing 20 years, COT-21 estimated that an additional $10 billion would be needed for highway construction. COT-21 also identified a large number of long- term transportation needs for ports, airports, rail, and mass-transit systems. Consequently, COT-21 recommended that the commonwealth commit itself to "a stable, predictable, long-term construction program" to be financed through

• A state sales tax increase of .75 cents;
• A 4-cent per gallon increase in the gasoline tax;
• An increase in the titling tax to 4 percent with trade-in; and
• Taking advantage of all interest on current and future balances from funds earmarked for highway use.

In a 1986 special session, the General Assembly partially accepted the COT-21 recommendations. Instead of adopting a .75-cent state sales tax increase, the legislature passed a .5-cent increase. It raised the gasoline tax by 2.5 cents, not 4 cents, and raised the titling tax by 1 percent, not 4 percent. The idea of earmarking interest on current and future balances from funds earmarked for highway use was retained. By not embracing the COT-21 recommendations in their entirety, did the 1986 special session of the General Assembly merely postpone the inevitable?

In 1991 then Senator Charles Waddell, later appointed deputy secretary of transportation and, since then, appointed to the Parole Board, introduced Senate Joint Resolution 188, which requested a study by VDOT of the "transportation trust fund formulae." This formula, adopted by the 1985 General Assembly, divided money for transportation construction projects into four major modal categories:highways--85 percent; rail and public transportation--8.4 percent; aviation--2.4 percent; and ports--4.2 percent. (In 1998 the General Assembly reduced the share for highways from 85 percent to 78.9 percent. The share for rail and public transportation increased from 8.4 percent to 14.5 percent.)

The SJR 188 study was an internal VDOT function, but VDOT had guidance from an advisory committee consisting mostly of representatives from local governments, planning district commissions, and other entities. VDOT issued the final SJR 188 report in 1993. Its most significant revelation was the identification of very serious shortfalls in transportation revenues over the next 20 years to pay for "needed" transportation projects in all modal categories (see Table 1).

Section 33.1-23.03 of the Code of Virginia requires "a comprehensive review of statewide transportation needs of all highway systems in the commonwealth" at least once every five years. Furthermore, the same section of the code requires VDOT to produce "an inventory of all construction needs for all systems to a target year 20 years in the future based on standards established by the Department of Transportation." For the current decade, such assessments had to be presented to the General Assembly and local officials no later than October 1, 1994, and October 1, 1999 (as of November 15, 1999, this assessment had not been released).

Robert Martinez, secretary of transportation under Governor George Allen, presented the 1994 assessment, and the dollar estimates of 20-year transportation needs were somewhat similar to figures in the SJR 188 report. One major difference, however, was that the 1994 assessment presented the figures with a two-tiered approach: a "moderate" scenario with a less inclusive inventory of "needs" and an "aggressive" scenario that was more inclusive in its list of "needed" transportation construction projects (see Table 2, which also includes the earlier SJR 188 estimates).

How are highway "needs" defined?

According to the 1994 Capital Needs Assessment for both scenarios, nearly 74 percent of Virginia's transportation needs fell within the commonwealth's 56,101-mile highway system. The responsibility for maintaining this vast system is VDOT's. Under the Byrd Road Act of 1932, the commonwealth assumed responsibility for maintaining county (secondary) roads for all counties except Henrico and Arlington. With a total of 46,655 miles, the secondary road system makes up the largest component of Virginia's highway system. In addition, Virginia maintains 1,105 miles of interstates and 8,007 miles of primary roads. The remaining 334 miles consist of road "frontage."

Has Virginia's approach to identifying transportation needs truly been a process, described by Governor Gilmore, of "[drawing] up a wish list, [and putting] on a price tag?" Among local officials, legislators, and other policymakers, there is hardly a more formidable challenge than distinguishing between transportation "wants" and "needs." Efforts to prioritize the transportation projects almost always provoke heated debate. How does the priority of congestion relief in an urbanized area compare with the priority of improving access and safety to benefit rural areas seeking economic development and tourism opportunities? For both types of projects, equal passions must somehow be accommodated. VDOT has attempted to incorporate a fairly large number of objective factors into the very difficult process of assessing highway needs.

Table 1

"Needed" transportation projects

Mode	Total needs (20 years)	Estimated revenues	Unfunded needs
	(in millions)	available (in millions)	(in millions)
Highways	$37,136.0	$18,221.40	$18, 914.6
Rail	168.3	11.6	156.7
Public transportation	10,817.0	6,937.7	3,879.3
Aviation	2,846.2	2,302.9	543.3
Ports	1,168.1	440.8	727.3
Totals	$52,135.6	$27,914.40	$24,221.2

Table 2

1994 modal assessment (figures in millions)

Mode	Aggressive	Moderate	SJR 188 study
Highways	$53,540.3	$34,743.6	$37,136.0
Public transportation	13,552.9	8,312.0	10,817.0
Rail	565.5	102.6	168.3
Aviation	2,399.8	1,628.6	2,846.2
Ports	1,705.8	1,619.3	1,168.1
Totals	$71,764.30	$46,406.10	$52,135.60

Since at least the mid-1980s, VDOT, responding to statutory direction, has utilized methodologies that incorporate a long-term 20-year planning horizon when assessing transportation needs. The 1993 SJR 188 report states that "needs were defined as construction needs based on existing, and forecast, requirements to upgrade deficiencies and to meet the demand for new and/or improved facilities, except in the case of transit and commuter rail, where operating as well as capital costs were included" (see Study of the Transportation Trust Fund Formulae, SJR 188, final report, March 1993).

According to VDOT, a complete evaluation of Virginia's highway network takes three years. Each road is evaluated according to the following criteria:

• Adequacy of road segments to handle existing traffic;
• Adequacy of the road to handle forecasted traffic increases;
• Adequacy of road geometrics, regardless of traffic volumes;
• Adequacy of pavement width (depending on the roads functional classification);
• Whether there are spot deficiencies (curves);
• Bridge deficiencies;
• Draining and flooding problems (to protect the surface from wash out); and
• Whether there are safety problems.

After considering the above factors according to national standards that "define adequacy," VDOT issues a "level of service" (LOS) rating, or a score of the road segment's adequacy. The scoring system is based on a range between "A" and "F." The most desirable LOS is "A," which indicates "free flowing traffic with low volumes and high speeds." At the opposite end of the spectrum is the highly undesirable LOS of "F," which indicates "speeds reduced substantially and stoppages may occur for short or long periods."

Since 1994, the next--and most recent--attempt to comprehensively assess long-term transportation needs was completed in early 1998 by COFT. The commission's report made some of the most dire projections yet about the serious extent of transportation needs over the next 20 years when compared to the serious shortage in estimated revenues available to pay for them. Here are two significant points from the 1998 report (see the Interim Report of the Commission on the Future of Transportation in Virginia, House Document No. 12, Commonwealth of Virginia, Richmond, 1998.):

• State agencies representing the transportation modes estimate that the needs projected over a 20-year period (1998-2017) would cost $68.4 billion, not including inflation, and $88.8 billion including inflation. (Note: this was the first of these reports to incorporate considerations about the effects of inflation on the cost of future transportation projects.)
• On an annualized basis, the revenue shortfall with costs not inflated is about $2.3 billion. With costs inflated, the shortfall totals $2.3 billion in the first year and increases steadily to $4.1 billion in 2017.

What do we do now?

Whether we believe that recent assessments of long-term transportation needs are inflated or not, a sufficient number of reports and commentaries from a variety of sources indicate very strong and passionate beliefs by many state officials, local officials, and business leaders that the failure to make substantial improvements to Virginia's transportation system will cost the commonwealth far more in the long run than paying for many needed improvements in the immediate future. Impatience is growing. In a number of regions in the commonwealth, business groups, often led by local chambers of commerce, are studying improvements to regional transportation plans. Transportation has been called the economy's "lifeblood," and these groups understand the imperative for expedited and sustained improvements to Virginia's transportation infrastructure. The Fairfax County Chamber of Commerce, for example, has asked candidates for the General Assembly not to rule out higher taxes for transportation in the 1999 elections.

In 1997 the Greater Washington Board of Trade issued a transportation study that criticized past failures of public officials to construct many transportation improvements identified as necessary nearly 30 years earlier. The study noted that "the cost of making up lost ground by constructing facilities that should have been built years ago will be expensive, yet represents only a fraction of the hundreds of billions of dollars in economic and quality of life losses that will be incurred if the [greater Washington] region continues to invest only at current levels." In the year 2030, will our children and grandchildren be making the same criticisms of our generation because we failed to act decisively today?

At the second meeting on July 28 of the Governor's Commission on Transportation Policy, member Sid Dewberry distributed a short paper entitled "Giving the Governor What He Asked For." The paper was Dewberry's reaction to Governor Gilmore's request that the commission think "outside the box" and offer alternatives to a tax increase. Among his proposals were suggestions to increase the minimum driving age, place restrictions on driving by older citizens, encourage businesses to establish four-day workweeks, and develop regional "telecommuting" centers to shorten commuting distances between home and the workplace. Similar proposals have come from various other sources. All of them are intended to diminish the number of automobiles on the road, especially at peak driving times. Are these alternatives the only ones available unless substantial amounts of new revenue are found?

There is no doubt that efforts to reach new efficiencies in transportation, including those that discourage single occupancy of cars, must continue. Governor Gilmore's call for complete "re-assessment of the way we do things" in the area of transportation should be embraced.

However, this new way of doing things must realistically assess contemporary traveling patterns that are often far more "circumferential" (or suburb-to-suburb) than "radial" (between suburbs and the urban core). At the end of the day, with whatever improvements to efficiency that may be possible, Virginia will probably still find itself with a seriously underfunded trans-portation system. While studying opportunities for new efficiencies, the General Assembly should seriously review all original COT-21 revenue proposals. Increasing the gasoline tax (the most convenient user fee for highway improvements) is always the first alternative to consider. Each penny increase in the gasoline tax returns approximately $44 million in revenue, but it would take a hefty increase to make a major dent in funding Virginia's growing transportation needs. Currently, Virginia's gasoline tax is 17.5 cents per gallon. With the exception of Kentucky, which has a gasoline tax of 16.4 cents, all other states bordering Virginia have higher gasoline taxes: Tennessee - 20.0 cents, North Carolina - 21.2 cents, Maryland - 23.5 cents, West Virginia - 25.35 cents, and the District of Columbia - 20.0 cents. In fact, only 11 states in the nation have lower gasoline taxes than Virginia.

The entire burden for increasing transportation revenues, however, should not rest entirely upon gasoline taxes. Virginia's bonding practices need evaluation. One proposal that deserves serious consideration is the dedication of additional revenues $71 millionfrom recordation tax revenues in highway bonds that could be multiplied tenfold to $710 million. Money pulled from general funds should also be considered, but cautiously. How would education and aid to localities for other programs be affected? While earmarking substantial sums of money for transportation from budget surpluses is also a proposal worth serious consideration, these surpluses cannot be taken for granted. They come and go with business cycles. To his credit Governor Gilmore has proposed a number of interesting funding proposals worth $2.5 billion over the next six years. All of them need to be scrutinized for their long-term adequacy to pay for "high priority" transportation improvements. The proposals also need to be evaluated for their effect on other state services, especially if improvements are to be financed through transfers from the general fund, the tobacco settlement, and other sources. Public/private partnerships, the creation of regional transportation improvement districts with possible taxing authority, should also be on the table. In the 2000 session, it is critical that the General Assembly seriously review every possible alternative to increase both funding and efficiency to improve Virginia's transportation system. Failure to take effective, decisive action soon will only cause the number of necessary transportation improvement projects to accumulate.

¹ Over the past decade the definition of "needs" has usually been at the center of debates. Since several reports generated through various statewide studies have made an effort to identify such "needs," however defined, this term will be placed within quotes throughout this article and defined in a manner consistent with whatever report is being described.

Virginia's transportation revenues

In FY 2000 Virginia estimates the availability of $1.87 billion in transportation revenues from state sources. Following is a breakdown of estimated state revenues contributed by each source:

Allocated Tax	FY 1999 (in millions)
Motor vehicle fuels tax	$ 752.0
Motor vehicle sales and use tax	$ 400.4
Motor vehicle licenses fees	$ 181.7
State sales and use tax	$ 338.9
Interest earnings	$ 8.7
Other	$ 192.7
Total	$1,874.4

In addition to the $1.87 billion in state revenues estimated for FY 2000, VDOT also estimates an additional $711.6 million in federal revenues. This figure is actually a reduction from $837.3 million in federal revenues in FY 1999. Under the federal Intermodal Surface Transportation Efficiency Act (ISTEA) 21-percent program, federal allocations for Virginia fall within the following categories:

Program	Amount (in millions)
Interstate, national highway system (NHS)	$ 254.8
Surface transportation program (STP)	$ 173.9
Minimum guarantee	$ 65.2
Bridges	$ 103.2
Federal projects and grants	$ 44.3
Congestion mitigation and air quality (CMAQ)	$ 20.8
Other (including FEMA)	$ 48.7
Total	$ 711.6

Despite much of the discussion in the article about assessing transportation needs over a 20-year period, the chief instrument utilized by VDOT for scheduling the progress of transportation projects is the Six-Year Improvement Program. This rolling document is updated each year. Approved by the Commonwealth Transportation Board, whose members are appointed by the governor, the program identifies projects (in various phases) that will receive attention over the following six years. In the sense that the Six-Year Improvement Program usually contains projects for which some funds have been allocated, this document is far more constrained than the 20-year capital needs assessment, which is required every five years. One common criticism of the Six-Year Improvement Program, however, is that it raises expectations that projects will actually reach completion within a six-year time-frame. Quite often they do not. Some of them may take twice that long.

In May VDOT estimated the availability of $16.6 billion in revenues over the next six years to pay for some portion of many transportation projects. Here is a breakout of how much money each revenue source contributed to the sum of $16.6 billion:

• Federal revenues: $4.3 billion
• State revenues (gasoline tax and other): $12.1 billion
• Local contributions: $200 million

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