A carefully crafted compromise to pump new money into Virginia’s cash-starved transportation system inched closer to passage in the General Assembly today, winning bipartisan support in the House of Delegates.
But the evenly divided Senate postponed a vote on the transportation bill as Democrats sought a written assurance that Gov. Bob McDonnell would not stand in the way of a separate deal that could allow for an expansion of the Medicaid program. The delay pushed critical votes on the transportation bill and the state budget to Saturday, which is scheduled to be the final day of the 2013 General Assembly session.
“There’s some dissatisfaction with the transportation plan anyway, so it’s key that we have that Medicaid expansion” agreement, said Sen. Janet Howell, D-Fairfax County, a Senate budget negotiator.
The transportation bill is a top priority for McDonnell, looking to seal a legacy in the final year of his term. The plan passed Friday by the House would pump $3.5 billion into roads, rail and transit over the next five years and prevent rising maintenance costs from depleting the state’s highway construction budget.
McDonnell, a Republican, has been equally adamant about refusing to expand eligibility for Medicaid under the federal Affordable Care Act, insisting first on cost-cutting reforms in the state-federal health care program. In a Friday evening letter to Senate Republican Leader Tommy Norment, R-James City County, McDonnell commended negotiators for the compromise but stopped short of promising not to alter it when the budget reaches his desk. .
The federal health care law expands Medicaid eligibility to adults with incomes up to 133 percent of federal poverty level beginning next year, but allows states to opt out. The federal government will cover the full cost of the expansion for three years before gradually reducing its contribution to 90 percent.
The budget provision would allow Virginia to expand Medicaid eligibility if it receives federal approval for reforms to improve service delivery and reduce costs. It calls for creation of a legislative commission that would be authorized to expand enrollment in Medicaid once reforms are implemented. The panel would include five senators, five House members, and two non-voting cabinet secretaries.
In his letter, McDonnell commended negotiators for coming up with “a concept to ensure that significant reforms are attained prior to any expansion of Medicaid.” And, the governor noted, the provision would allow Virginia to pull back from expansion if the federal government retreats from its funding commitment.
Earlier in the day, the House passed the transportation bill by a vote of 60-40. The multifaceted plan would scrap Virginia’s 17.5 cents per gallon tax on gasoline and apply a 3.5 percent tax on the wholesale price of fuel and a 6 percent tax on the wholesale price of diesel fuel.
The package also would increase the retail sales tax from 5 percent to 5.3 percent, increase the vehicle sales tax from 3 percent to 4.3 percent, and dedicate a greater portion of the existing sales tax to transportation. The plan also creates a dedicated source for rail funding and should allow for the extension of Amtrak service to Roanoke.