D.C., MD, and VA Debate Regional Sales Tax for Metro

Date: November 15, 2016

Gov. McAuliffe stayed neutral on the tax following funding summit.

D.C., MD, and VA Debate Regional Sales Tax for Metro

At a regional summit in October,
Washington, D.C. Mayor Muriel E. Bowser, Maryland Gov. Larry Hogan, and
Virginia Gov. Terry McAuliffe discussed a new tax that would provide long-term
funding for Metro. However, the three regional leaders are divided about
whether this tax is a good idea.

 This is an issue that comes up
repeatedly, as Metro is the only major transit system in the U.S. that does not
receive significant income from a tax or dedicated funding source, reported The Washington
Post
. Each year, the areas Metro services must come up with the
funding, and this system has led to problems with safety and reliability.

The 1-cent regional sales tax was
one of three potential funding solutions proposed in a briefing by District
Chief Financial Officer Jeffrey S. DeWitt. The other two were annual passenger
revenue increases (13.5 percent, provided by spiked ridership or hiked fares)
and annual subsidy increases (8.2 percent from D.C., Maryland, and Virginia).

Gov. Hogan said that Maryland was
already providing $500 million in yearly funding to Metro and didn’t plan to
spend more until things improved. Gov. McAuliffe did not take a stand on the
tax one way or the other, but said that he would need goals set before he could
take the matter to the Legislature. He said he would be Metro’s ‘biggest
cheerleader’ if reliability and safety are dealt with and acknowledged that it
was necessary to find a long-term funding formula that works.

Related Content: Small Business News | Economy | Taxes | Virginia

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