Gov. Bob McDonnell signed into law on Monday what backers are terming the most significant investment in the Commonwealth’s transportation system in a generation.
The legislation, HB2527 and SB1446, sponsored by Speaker Bill Howell (R-Stafford) and State Sens. Chuck Colgan (D-Manassas) and William Wampler (R-Bristol), creates a framework to invest nearly $4 billion into Virginia’s road, rail and transit networks, and fund more than 900 projects, over the next three years without raising taxes.
“It has been over 20 years since we have made a major investment in our transportation system,” McDonnell said. “For far too long Virginians sat stuck in traffic while partisan politics put the brakes on progress. This year we put partisanship aside and recognized that for Virginia to retain its status as the friendliest state in the nation for business, we must invest in transportation and help the private sector create much-needed jobs in all parts of the Commonwealth. This common-sense legislation takes advantage of previously authorized and innovative new financing mechanisms at a time when interest rates and construction costs are at near historic lows and Virginians are in dire need of jobs. We are putting billions into our roads without a tax increase.”
“I applaud Gov. McDonnell for taking vital steps toward addressing the Commonwealth’s transportation crisis,” Colgan said. “The reforms signed into law today, combined with this infusion of funding and the governor’s work on transportation over the last year will have a lasting impact in beginning to address these challenges.”
Jeff Southard, executive vice president of the Virginia Transportation Construction Alliance said the state transportation system will now finally receive “the significant investment that will not only improve the travel experience for the millions who depend upon Virginia’s roads and transit systems each day, but it will support much-needed jobs for construction professionals throughout the Commonwealth.”
“The transportation construction industry is a major economic driver and provider of employment in Virginia that has struggled because we have neglected our responsibility to invest in the Commonwealth’s infrastructure for so long. The legislation signed today will help Virginia’s economy to once again thrive,” Southard said.
The legislation, which passed with the broad bipartisan support of Democrats and Republicans in both bodies of the General Assembly, uses several financing mechanisms that will enable the Commonwealth to take advantage of historically low interest rates on bonds and construction bids that are coming in well below project estimates.
The legislation:
Accelerates the issuance of $200 million of Capital Project Revenue Bonds authorized by the General Assembly in 2007 during fiscal year 2012 and $300 million in fiscal year 2013, thereby enabling VDOT to issue $1.8 billion in bonds over the next three years
Authorizes the issuance of $1.1 billion in federally backed Direct GARVEE Bonds to better leverage the Commonwealth’s annual federal allocation and support the construction of major congestion reducing projects throughout Virginia
Creates a new Virginia Transportation Infrastructure Bank, initially funded with $283 million from the fiscal year 2010 surplus and savings from the Virginia Department of Transportation (VDOT) performance audit, to make low-interest loans and grants to localities, transportation authorities and private-sector partners for transportation projects. The administration aims to put $1 billion into the bank through a number of mechanisms over the next three years.
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