Virginia Headlines


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AOBA's  Virginia Legislative and Regulatory Issues Committee and Metropolitan Political Action Committee will meet jointly Thursday, April 24 at 1:30 pm at the offices of Duke Realty Company, located at 4900 Seminary Road, Suite 900 in Alexandria, Virginia.  The Committees will receive presentations from staff regarding the outcomes of the 2014 session of the Virginia General Assembly and ongoing local issues.  The groups will also  discuss strategic direction and initiatives for the coming year.  AOBA members with Virginia interests are invited to participate.  For more info or to RSVP to attend, please contact Brian Gordon at bgordon@aoba-metro.org.
AOBA wrapped up a successful session, as the Virginia General Assembly adjourned this weekend.  The legislature failed to take action on a biennial budget, however.  The sticking point remains whether or not to accept federal funds and expand the state’s Medicaid program.  Governor McAuliffe has announced a special session for March 24 where legislators will be called back to Richmond to deal with the budget.  Some remain skeptical, however, that an agreement will be reached by that time.  The state government will shut down July 1, if no action is taken
The good news coming out of Arlington County is that the County Board has advertised a real estate tax rate with no increase over fiscal year 2014.  The bad news is that your tax bills may still be going up.  This is due to rising commercial assessments, up 12.4% over last year.  This increase was fueled primarily by new construction and increasing rents in the multifamily sector.  But some properties are in for an even greater sticker shock when their assessments come in.  Some 90 commercial properties have been assessed at an increase of 50% or higher in value over calendar year 2013. This comes in spite of a stagnating local economy and elevated vacancy rates.  The County has announced that it will conduct an administrative review of these extreme cases.  The process is expected to take roughly 30 to 45 days.

 

The Virginia House of Delegates will vote this week on H.B. 1059, legislation introduced at the request of Dominion Virginia Power to allow the company to retain overearnings collected from consumers related to investments in new generation facilities.

H.B. 1059 would unfairly increase the profits of the power company at the expense of consumers and erode State Corporation Commission (SCC) authority to protect consumers in future cases.  In Dominion Virginia Power’s 2013 rate case, the SCC held that through the current rates, Dominion is collecting about $280 million per year more than it needs to do its job and earn a fair (10 percent) profit.  That totals more than a half a billion dollars over two years.  H.B. 1059 is designed to allow the power company to keep some or all of that $560 million, which should be rightfully returned to consumers, and keep its rates in place until 2019.  Worse yet, the legislation deteriorates the authority of the SCC to provide meaningful oversight of utility rates going forward. Members are encouraged to take a moment to send a message to the Northern Virginia delegation to the House of Delegates asking them to oppose H.B. 1059.

The Virginia House of Delegates will vote this week on H.B. 1059, legislation introduced at the request of Dominion Virginia Power to allow the company to retain overearnings collected from consumers related to investments in new generation facilities.  A copy of the legislation may be viewed by clicking here

H.B. 1059 would unfairly increase the profits of the power company at the expense of consumers and erode State Corporation Commission (SCC) authority to protect consumers in future cases.  In Dominion Virginia Power’s 2013 rate case, the SCC held that through the current rates, Dominion is collecting about $280 million per year more than it needs to do its job and earn a fair (10 percent) profit.  That totals more than a half a billion dollars over two years.  H.B. 1059 is designed to allow the power company to keep some or all of that $560 million, which should be rightfully returned to consumers, and keep its rates in place until 2019.  Worse yet, the legislation deteriorates the authority of the SCC to provide meaningful oversight of utility rates going forward.
Members are encouraged to take a moment to click here and send a message to the Northern Virginia delegation to the House of Delegates asking them to oppose H.B. 1059.

 


Legislation in the VA General Assembly to require retrofit of all rental dwelling units with up to one carbon monoxide detector/alarm per sleeping area was amended in Committee this week.  The bill, introduced by powerful Senator Tommy Norment, the Senate Minority Leader, now only requires that carbon monoxide detector/alarm devices be installed at the request of a tenant.  The bill further allows for the assignment of reasonable costs of installation and maintenance to the tenant.  The bill will now head to the full Senate floor for approval.
The 2014 session of the Virginia General Assembly convened Jan. 8, with “transition” as the overarching theme thus far. In just the initial weeks, 15 new members of the House of Delegates have been seated, in addition to the new Governor and administration leaders settling in.  As major political battles over the budget and issues such as Medicaid expansion loom,  the General Assembly has already taken action on legislation affecting commercial and multifamily owners and managers.  Over 3,000 individual pieces of legislation are expected to be introduced and considered in this 60-day session.  AOBA maintains a full-time presence in Richmond during the legislative session and expects to have a full agenda this year, protecting the interests of AOBA members and the broader business community.  Already, AOBA has tallied a number of legislative victories. If questions arise, members are encouraged to contact Brian Gordon, bgordon@aoba-metro.org
The 2014 session of the Virginia General Assembly convened last week, with Republicans clinging to a narrow majority in the State Senate.  As the Senate organized, Republicans held a 20-18 margin of party control, with special elections pending for the seats vacated by Democrats Ralph Northam and Mark Herring, elected Lieutenant Governor and Attorney General respectively in November.  Delegate Lynwood Lewis, a Democrat, holds a 9 vote lead in the race to succeed Northam.  That race is heading to a recount.  Should he retain his lead and should the Democrats prevail in the Leesburg race to fill the seat vacated by Herring, the party split would be 20-20, with the Democrat Lt. Gov. able to cast a tie breaking vote, thus giving the Democrats a majority.

 

The Virginia General Assembly kicks off its 2014 legislative session on Jan. 8.  AOBA maintains a full-time advocacy presence in Richmond during the session to protect members’ interests.  It is expected that over 3,000 individual pieces of legislation will be considered during the 60-day session.  Already, the AOBA advocacy team is focused on bills to increase requirements for affordable/accessible units in new multifamily construction and to allow differential taxation in local government-designated service districts such as the revitalization district created last year in the Tysons business district of Fairfax County.

 

The Arlington County Board has been providing guidance to County Manager Barbara Donnellan as she and her staff prepare the County’s fiscal year 2015 budget.  In spite of a projected shortfall of roughly $20-25 million, the Board directed the County Manager to prepare a budget that closes the funding gap with no real estate tax increase, while maintaining the County’s ongoing investments in affordable housing, environmental sustainability, public schools and safety net services for needy residents.  Though the County expects expenditures to outpace revenues for a sixth straight budget cycle, the funding gap continues to grow smaller as real estate assessments climb.  The overall real estate tax base is projected to rise 2.6% this year on the strength of an average increase in residential real estate assessments of 5.5%.  Commercial assessments, on the other hand, are expected to be flat or even slightly decline in the coming fiscal year.  Arlington has been particularly hard hit by rising office vacancy rates, attributed largely to federal Base Realignment and Closure (BRAC) and sequestration.  The County Manager has instructed Department heads to provide a list of options for reducing expenditures.  Cuts will be required to meet the Board’s decree of closing the budget gap without a tax increase.  The County also faces additional cost pressures in the form of health care costs, funding obligations for the regional Metro system, technology investments, and a projected enrollment increase in County schools of roughly 700 students next year.
AOBA remains well-positioned going into the 2014 session of the Virginia General Assembly to advocate and advance the agenda of the commercial and multifamily real estate industries. The organization endorsed Terry McAuliffe for Governor early in the race, a strategic move which was rewarded by the election's outcome.  In addition, the vast majority of AOBA-supported candidates (65 out 67) were reelected to continue serving in the House of Delegates.  Investments made by AOBA’s Virginia Metropolitan Political Action Committee during the 2013 election cycle proved critical not only in preserving seats held by Delegates that have championed the cause of property management, but positioning the organization to effectively navigate a starkly divided legislature in Richmond.

 

 

AOBA members are invited to attend a FREE workshop on Dec. 11th,from 7:30 am to 12:30 pm, hosted by Arlington County, featuring national and local experts in high performance building.  The session's focus will be on the principals of building science for managing moisture in energy efficient buildings, specifically in multifamily residential properties. The program will cover options for affordable mechanical systems, materials and design that optimize energy efficiency and healthy indoor air, local and regional case studies describing successes and lessons learned, and testing procedures to ensure proper ventilation. The workshop will be held at the Arlington Central Library.  Attendance is free, but space is limited.  Click here for more info or to register.

With Virginia residents set to vote on Nov. 5, Republican gubernatorial candidate Attorney General Ken Cuccinelli has publicly released his plan on transportation, just weeks ahead of Election Day.  The plan consists of seven elements, some in alignment with AOBA’s policy positions and others in stark contrast.  Two particular elements of the Attorney General’s plan have drawn attention.  Cuccinelli first calls for the establishment of a congestion matrix database in the first six months of his administration.  The database would be used to evaluate and prioritize road and transit projects using a system of equally weighted variables, to include population, volume of licensed drivers, volume of automobiles, volume of motor carriers, vehicle miles traveled, number of businesses, roadway incidents, response time, and infrastructure age and condition.  The included variables would presumably favor projects in more densely populated areas of the state, most notably Northern Virginia.  The suggestion has drawn criticism, however, from rural legislators who point out that the formula ignores projects intended to boost economic development.  Cuccinelli additionally would “devolve” responsibility for transportation planning and construction to the local level.  AOBA has opposed such a measure in the past since local governments are currently overwhelmingly reliant on real estate taxes as a source of revenue and devolving responsibility for additional services would only place additional strain on property owners.

 

 

 

 


Even though the federal government has reopened its doors for business, the Commonwealth of Virginia expects the impacts of the 16-day work stoppage to linger. More than any other state in the union , Virginia’s fiscal picture has been - and will continue to be - negatively impacted by the shutdown according to a study conducted by online personal finance website Wallet Hub. The shutdown affected 338 state employees whose jobs are dependent upon federal funding. Those positions were either furloughed or had their work hour reduced.  Virginia’s prominent federal and defense contracting presence meant additionally that private sector employees were similarly impacted, to the tune of roughly $200 million in lost wages each day just in Northern Virginia according to figures produced by George Mason University.  Reductions in retail sales and correspondingly sales tax collections (already down 0.4 percent in September) are anticipated as a result. This will mean less money for policy priorities and the potential need for additional cuts as the Governor and General Assembly prepare a new biennial budget in 2014.

 

 


Virginia Governor Bob McDonnell publicly lambasted Congress last week for its  “dysfunction,” which he indicated would have a direct negative impact on state revenues in the months ahead.  While revenue collections rose during the month of September by 2.6 percent, the administration predicts that the trickle-down effect of the 16 day Federal government shutdown will undermine the responsible financial management practices of the Commonwealth.  A study, conducted by online personal finance website Wallet Hub, confirmed the Governor’s assertions, finding that Virginia is affected more than any other state by the federal government shutdown.  The impacts will be felt in terms of federal worker wages, federal contracts, small business lending, and real estate transactions and market deterioration.
Delegate Tom Rust (R-Herndon), a two-time recipient of AOBA’s Leadership Award, has been named by Virginia Speaker William Howell as Chairman of the House Transportation Committee.  Rust replaces outgoing Delegate Joe May (R-Leesburg) as Chairman.  The appointment keeps the position within the Northern Virginia delegation, a key consideration as the region faces unique transportation challenges.  After more than 25 years of failing to invest in maintaining and expanding Virginia’s transportation infrastructure, the General Assembly passed landmark funding legislation during the 2013 session to generate over $6 billion in new revenue for transportation projects.  Rust will be charged this year with overseeing legislative approaches to ensuring that those funds are invested in the most efficient and responsible manner to reduce congestion, improve safety and promote economic development.  AOBA congratulates Delegate Rust on his appointment and looks forward to continuing to work together on these critical issues going forward.
Virginia has once again been named the “Best State for Business” by Forbes Magazine.  The coveted ranking was awarded to Virginia this year, in recognition of its pro-business economic and regulatory climate.  Forbes specifically cited a series of tort reform measures supported by AOBA during the 2013 General Assembly session as having a positive impact on the Commonwealth’s business environment.

The Virginia Metropolitan Political Action Committee, AOBA’s political arm in Virginia, endorsed Democrat Terry McAuliffe for Virginia Governor.  Citing his demonstrated understanding of real estate industry issues, strong support for transportation infrastructure investment and attention to issues of importance to both real estate and the broader business community, METPAC called McAuliffe the better candidate for the job. “Terry McAuliffe is committed to sustaining and improving Virginia’s business climate. He understands that a range of business space and housing options is needed to fuel that economic expansion. And he recognizes the critical role that Federal employers and contractors in northern Virginia play in the Commonwealth’s economic health” said Cindy Clare, President of Kettler Management and Chairman of the Metropolitan Political Action Committee.
AOBA's Virginia Metropolitan Action Committee and Legislative and Regulatory Issues Committee met jointly Sept. 19 at the offices of Duke Realty Company. The group continued its ongoing discussions regarding Virginia's upcoming elections, review local issues of concern and look ahead to the organization's policy agenda for the 2014 session of the Virginia General Assembly.  AOBA members with interests in Virginia were invited to attend and provide input on these important decisions and discussions. 
Virginia Secretary of Veterans Affairs and Homeland Security Terrie Suit has been selected as Chief Executive Officer of the Virginia Association of Realtors.  Suit previously served in the Virginia House of Delegates, representing Virginia Beach and Chesapeake, and Chaired the Virginia Housing Commission and Housing Subcommittee of the House Committee on General Laws.  AOBA has a longstanding working relationship with Ms. Suit and looks forward to collaborating with her in her new role, working on behalf of the real estate industry.
A poll released last week by Quinnipiac University shows Democratic candidate Terry McAuliffe with a 48-42 lead over his Republican opponent Ken Cuccinelli in the race for Virginia’s next Governor.  While the results of the poll, conducted among likely voters in November’s election, revealed an early edge for the former national Democratic party operative, it also showed mixed feelings among Virginia voters with regard to the two candidates.

When asked about the candidates’ perceived qualities such as honesty, empathy, experience and ability to perform the duties of the office, voters gave the nod to Cuccinelli.  The polling also confirmed a few generally perceived notions about the race.  A few highlights:  McAuliffe carries Democrats by a margin of 92-1 and Cucinnelli carries Republicans by a margin of 90-6, while Independent voters are sharply divided (44-42 in favor of Cuccinelli);  The candidates are roughly even among male voters, but women voters prefer McAuliffe 50-38;  White voters prefer Cuccinelli 50-42, while black voters resoundingly support McAuliffe 74-7.

 

Fairfax County is seeking the input of commercial and multifamily property owners and managers with regard to two issues presently under consideration by the Planning Commission. The Environmental Committee of the Fairfax County Planning Commission is in the process of reviewing a report received from the MITRE Corporation, outlining recommendations to the County for building electric vehicle charging infrastructure, particularly in conjunction with the redevelopment of the Tysons urban district.  Included in the report were recommendations for 35% of all new commercial parking spaces built to be fitted with transformers, switches and conduit to accommodate the installation of electric vehicle charging stations.  The same recommendation was made for 100% of new multifamily parking spaces constructed Countywide.  A copy of the report and recommendations may be accessed by clicking here.

 

The report was issued two years ago in August of 2011, but is currently being revisited by the Planning Commission’s Environment Committee per a directive of the Board of Supervisors.  A staff list of policy questions may be accessed by clicking here.  AOBA members with development interests in Fairfax County, and the Tysons area in particular, are asked to review the staff policy questions and provide feedback to inform AOBA’s organizational response.  Please direct comments and suggestions to Brian Gordon at bgordon@aoba-metro.org.

Additionally, the County’s Department of Public Works and Environmental Services (DPWES) has just released a draft Stormwater ordinance update.  Draft text can be accessed by clicking here.  Corresponding proposed changes to the County’s Public Facilities Manual can be accessed by clicking here.  The draft ordinance was prepared in response to state regulations (pursuant to U.S. Environmental Protection Agency requirements) and designed to set parameters for local government reviews and inspections of general permits relating to Stormwater runoff from construction sites.  AOBA staff is in the process of reviewing the proposed ordinance.  Again, members with interests in Fairfax County are requested to share the draft ordinance language with your engineering departments and provide feedback to assist in the development of AOBA’s organizational response to the County.  Again, please send comments and feedback to Brian Gordon at bgordon@aoba-metro.org.

 

Delegate John Cosgrove (R-Chesapeake), a longtime ally of AOBA and the real estate industry in the Virginia House of Delegates, was elected recently in a special election to the state Senate.  He will complete the unexpired term of Senator Harry Blevins, who announced his retirement at the end of last session.  Senator Cosgrove has been a pro-business vote in the House, serving at various points on the Committee on General Laws, the Housing Subcommittee and the Virginia Housing Commission, through which much of the legislation of interest to AOBA members is routed.  He had been appointed to the Housing Commission as a representative of the House of Delegates, and will therefore be required to step down from this position when he assumes office as a member of the Senate.  AOBA continues to enjoy a strong working relationship with him and will continue to work closely with him in this new capacity.

The Northern Virginia Transportation Authority recently adopted the list of regional projects on which to move forward in the first year that it will be spending new, transportation-dedicated revenues authorized by the landmark transportation legislation adopted this year. The Authority, comprised primarily of local elected officials from various Northern Virginia jurisdictions, was constituted years ago to make such planning decisions, but basically has not had money with which to implement any plans. Thanks to the new law’s revenue stream, the Authority started receiving new tax dollars July 1, and is immediately turning its attention to putting them to work.

AOBA has joined other business organizations in providing feedback to the Authority. Having long supported a dedicated source of funding for regional transportation projects, AOBA is urging the Authority to ensure that those hard-fought and precious funds are spent wisely and responsibly. We have pointed to the driving tenets behind the initial formation of the Authority: to allow decisions on local transportation projects to be made by local decision-makers, rather than in Richmond, and to cut across jurisdictional boundaries and avoid parochialism by applying the funds mainly to projects of truly regional significance.

When the dust settled, the Authority had approved expenditures totaling $209 million for FY 2014. While some project selection criteria were applied to the proposed list of projects considered in this first round, there is clearly a need for more and stronger guidelines going forward-- certain projects made the cut this time, such as bus shelters, pedestrian walkways, and localized bus route improvements, that do not really live up to the measure of making a truly significant impact on the region’s transportation problems—which was the very purpose intended for the local funding streams. Click here to view a list, by jurisdiction, of projects considered and selected by the Authority for action in year one.

Looking to FY 2015, AOBA joined with members of the General Assembly in calling on the Authority to adopt additional criteria in determining future projects. Most notably, we felt that reduction in commute times should be an evaluation factor. In addition, we urged the Authority to move expeditiously to hire a professional staff to manage its day-to-day operations. To date, the work of the Authority has been carried on by transportation staff members from local governments, serving in a voluntary capacity. In order to perform the necessary analysis of projects, assist in selection and then oversee implementation, a dedicated staff is needed. In an initial response to this suggestion, the Authority voted to appoint former Fairfax City Mayor John Mason as its interim President.

AOBA represented the multifamily housing industry this week, testifying before the Virginia Housing Commission Work Groups on Affordability, Real Estate Law & Mortgages and Housing & Environmental Standards.  AOBA joined with other professional property management associations in opposing a legislative proposal to add “lawful source of income” to the list of protected classes under fair housing law.  The coalition presented the various administrative, time and cost burdens associated with the federal housing choice (Section 8) voucher program, which would be effectively made mandatory by such legislation.  AOBA additionally led opposing groups, testifying against proposed measures to mandate high-rise residential properties to retrofit power generators to fuel emergency and back-up systems during power outages and potentially even require upgrades to existing code to include HVAC operation.
Advocates for the formation of an independent public housing authority in Arlington County have acquired the requisite signatures to place a measure on the ballot, putting the issue before voters this November.  The County Board will take procedural action this month to officially request the placement of the initiative on this year’s ballot by the Circuit Court.  The County’s Democratic party has historically opposed the measure.

 

Party nomination contests were held throughout Virginia on June 11.  The biggest election news was the defeat of Delegates Beverly Sherwood (R-Winchester) and Joe May (R-Leesburg), who had faced challenges for their party’s nomination rooted in their support for this year’s landmark transportation funding bill.  Speaker William Howell (R-Stafford) and Delegate Bobby Orrock (R-Thornburg) survived similar challenges.  AOBA also backed Delegate Rosalyn Dance (D-Petersburg) in her Democratic primary.  Dance serves on the Virginia Housing Commission and Housing Subcommittee of the House Committee on General Laws and has proven to be a strong advocate for the multifamily housing industry.  She too overcame her inter-party challenge.  On the statewide level, the Democratic nominees for Constitutional offices were also decided, with Leesburg Senator Mark Herring and Northern Neck Senator Ralph Northam receiving the party’s nomination for Attorney General and Lieutenant Governor respectively.
AOBA joined numerous business organizations and industry groups for a ceremonial signing of H.B. 2313, this year’s landmark transportation funding package, which will invest $1.5 billion in Northern Virginia roads and transit systems and permanently cap the local option commercial real estate tax applied in Fairfax and Arlington Counties.  Governor Bob McDonnell signed the legislation, flanked by supporters on the steps of the Capitol building in Richmond.  The event marked the first significant investment of funding into the Commonwealth’s critical transportation infrastructure in more than 25 years.

 

AOBA's Virginia Legislative and Regulatory Issues Committee and Metropolitan Political Action Committee will host Democratic candidate for Virginia Governor and former Democratic National Committee Chairman Terry McAuliffe at its next meeting.  The meeting is scheduled for Friday, May 24 at 1:30 p.m. at the Metropolitan at Pentagon City, located at 901 S. 15th Street in Arlington. Owners and managers with interests in Virginia are invited to attend.  Please let us know if you will be able to participate by emailing Brian Gordon at bgordon@aoba-metro.org.
The Arlington County Board approved a set of proposed interim revisions to the guidelines by which food trucks and other street vendors must abide.  The changes extend the duration of time that a vendor may operate from a single location, from one to two hours, and close an unintended loophole discovered by County staff which provided an exemption for all sales between the hours of 7:00 a.m. and 8:00 p.m.  The County continues its more comprehensive evaluation of food truck operations and will return to the Board with recommendations for further amendments at some point in the future, though no timetable has been identified.  Some AOBA members have experienced problems with food trucks operating on or adjacent to their properties.
The landmark transportation funding package passed by the Virginia General Assembly earlier this year has cleared yet another hurdle as the General Assembly resoundingly approved of the Governor’s amendments to the bill in its reconvened session on April 3.  The Governor’s amendments addressed Constitutionality questions raised by Attorney General Ken Cuccinelli in addition to reducing certain fees adopted as part of the funding package.  A key component of the legislation for AOBA members in addition to the long-needed influx of investment into critical infrastructure is that the commercial real estate tax surcharge adopted by Fairfax and Arlington Counties will be permanently capped at 12.5 cents per $100 assessed value.  This rate would have reverted to 25 cents in a few years without General Assembly action.  Delegate Bob Marshall (R-Manassas) hinted, however, that he would still attempt a legal challenge of the bill at some point in the future.

 

On March 13, Gov. Bob McDonnell signed H.B. 1598 into law.  The bill was introduced this year by Delegate Richard Anderson (R-Woodbridge) at AOBA’s request.  Its passage represents a significant legislative victory for AOBA members and will provide a more balanced and equitable process for appealing local government real property tax assessments.  The bill amends several code provisions with regard to local government real estate tax assessments and the process through which aggrieved taxpayers may appeal their assessed values.  The amendments initiated by AOBA seek to bring Virginia’s code into alignment with nationally accepted standard assessment practices and create a level playing field for aggrieved taxpayers in order to establish a fair market valuation or real property for tax purposes.

In the first meaningful infusion of funding into the Commonwealth’s critical transportation infrastructure in nearly 30 years, the Virginia General Assembly passed a sweeping transportation funding plan. The statewide plan would generate approximately $454 million in new money next year, and $870 million per year when fully implemented beginning in 2018

Of perhaps the greatest significance to AOBA members in this deal is the freezing of the commercial and industrial tax rate cap at 12.5 cents in perpetuity. AOBA secured a reduction of the maximum rate to this level in previous Sessions. However, that cap was scheduled to sunset in 2015, after which time it would rise to 25 cents per $100 assessed value.

Moreover, AOBA successfully urged rejection of a provision in the original draft conference committee report which would have compelled all Northern Virginia jurisdictions to adopt the commercial real estate tax surcharge as a condition of receiving regional funding. Currently, only Arlington and Fairfax Counties have adopted the levy - Arlington at 12.5 cents and Fairfax at 11 cents.  The original conference committee language would have meant that AOBA members with properties in every other Northern Virginia jurisdiction would see a property tax increase of 12.5 cents per $100 assessed value on all commercial buildings.  AOBA lobbied conferees to support an alternative approach recommended by Alexandria Delegate Rob Krupicka that, instead of forcing the commercial property surtax on local governments, would only require that local governments put forward an "equivalent local effort," i.e., localities could provide matching funds from other revenue sources of their choice (e.g. other taxes, bonding/other investments in infrastructure improvement).

This legislation represents a significant victory for AOBA members on this and several other fronts.

Cobbled together from numerous funding sources in an effort to secure the necessary number of votes in each Chamber, the legislation consists of the following basic components:

• Eliminates the states current 17.5 cents per gallon gas tax and replaces it with a 3.5% tax on gas “at the rack” (at the wholesale level) and a 6% tax on diesel fuel.

• Raises the statewide sales tax from 5% to 5.3%

• Raises the titling tax on vehicles from 3% to 4.3%

• Charges a $100 registration fee on electric vehicles

• Dedicates a portion of any future proceeds from internet sales taxes (pending action by Congress) to transportation. (A trigger mechanism is also included in case Congress fails to act, which would replace such funds with an additional 1.6% on the gas tax.)

• Increases the portion of sales taxes statewide currently dedicated to transportation from 0.5% to 0.67%.

• Adopts an additional 0.7% regional sales tax in Northern Virginia to be dedicated to new transportation construction.

• Increases the existing grantor’s tax in Northern Virginia by 25 cents per $100 assessed value.

• Adds an additional 3% transient occupancy tax to hotel stays in Northern Virginia only.

This legislation more than closes the existing maintenance funding gap, whereby construction funds are currently being depleted at a rate of roughly $400-500 million per year to support maintenance needs in other areas of the state. Regional funds generated by way of the additional sales, grantor’s and transient occupancy tax levies would stay in Northern Virginia, with 70% going towards regional projects to be administered by the Northern Virginia Transportation Authority and 30% to be granted to local governments that meet established thresholds for infrastructure investment. The regional funding sources in Northern Virginia total approximately $350 million per year.

AOBA led a coalition of stakeholder groups opposing legislation before the Virginia General Assembly to transfer administration and oversight of fire inspection fees from the Board of Housing and Community Development to the Fire Services Board.  S.B. 822 would have made it easier for fire services agencies to seek fee increases by removing the oversight out of the existing codes update process and instead placing the decision in the hands of a 15-member body, of which 13 positions are legislatively proscribed to represent local government and fire services interests.  The bill was passed by indefinitely in the Housing Subcommittee of the House Committee on General Laws.