More News

Gov. Tim Kaine (D) dumped a bucket of cold water on Fairfax County last Friday morning.

With Virginia staring at a $3.5 billion budget shortfall, Kaine proposed scaling back the $950 million Richmond sends to local governments each year to pay for car tax relief.

For Fairfax County and its 300,000-plus car owners, that translates to a $211 million annual hit. In 2008, the owner of a $20,000 car in Fairfax County paid a $275 car tax while the state picked up the $640 balance. Losing the state's share of the tax would more than double the average car owner's bill. Two- or three-car families could see their annual tax hit rise by $1,000 or more.

In Kaine's defense, closing 10-figure budget gaps isn't easy work. It doesn't happen by shuttering rest stops on I-95, reducing DMV hours in Norfolk and Newport News or laying off a few hundred state employees.

Since the U.S. economy fell off a cliff 18 months ago, legislators have taken a cleaver to every agency in the state. Much-needed transportation projects have been put off indefinitely. The same goes for critical education, mental health and public safety initiatives.

And as brutal as things were in 2008, a continued shortfall in revenue from sales taxes and business and individual income tax collections promise to make next month's deliberations in Richmond even more painful. In addition to a budget bill that cuts car tax relief and funding for state-supported colleges, mental health services and public safety, Kaine is preparing a separate bill that would phase in a 1 percent -- or $2 billion -- income tax increase over two years.

Raising income taxes and gutting car tax relief certainly won't endear Kaine to residents of Fairfax --where people tend to earn more money and drive more expensive cars than their neighbors to the south and west -- but those options trump every other plan we've heard. Eliminating core services that millions of Virginians now depend on should not be an option. Nor should jeopardizing the state's Triple-A bond rating, a status that saves Virginia tens of millions of dollars each year in interest. During his pitch to legislators on Friday, Kaine said Virginia's prospects of making it through the recession in one piece remain strong, but things would change quickly if cuts are made hastily or new revenue streams (i.e. taxes) are ruled out entirely.

Yes, pulling back the $950 million will force Fairfax and other cash-strapped localities to make some tough choices next year. State law gives counties just two significant sources of funding -- real estate taxes and personal property taxes -- and adding a nickel or two to the real estate tax bill of a Reston or Herndon resident living on a fixed income is a weak option. It gets even weaker when one considers that most Fairfax homeowners have already seen the value of their properties drop 15 or 20 percent since 2006.

That leaves personal property tax. And while everyone in the state is encouraging Kaine to look somewhere else for the $3.5 billion, nobody has given him a clue as to where he might be able to find it.