The key to a transportation deal? The phony money

Picking up on the ideas Jim wrote about in our latest newsletter regarding the angst among some House GOP caucus members in wake of the Speaker’s trashing of the Senate redistricting plan…

The obvious question: why didn’t any House members appeal Howell’s ruling? The votes to win just weren’t there. If anything, the House caucus was united behind the Speaker, and those who might have entertained a challenge would have been perceived as attacking the Speaker personally. In other words, they would have committed career suicide.

Fine. Redistricting ends up in the circular file. What affect, if any, does it have on the other bill that defines this session: the lone, surviving transportation measure now before the Senate? One line of thought is that Speaker Howell and Democratic leader Dick Saslaw have reached an understanding on that. Over in the Senate, Mr. Saslaw will find the Republican vote he needs to amend the House bill more to his liking — meaning it will contain big tax hikes (and don’t forget about the regional authorities…yes, they are back on the radar).

This ugly thing will roll back to the House which will likely reject the amendments. Off we go to conference, where the real deals were always intended to be struck.

What can this handful of legislators do to craft a bill that will pass both Houses? The secret is in the money that doesn’t exist — that so-called internet sales tax.

Governor McDonnell’s plan, and the Senate Republican alternatives, all contained a prize fiction: most of the money for Virginia’s roads was going to come from a federal bill (that has yet to be introduced, let alone passed) which will give states the power to compel online retailers to collect state sales taxes. Nevermind that each state would then have to pass its own laws setting up such a tax regime. What matters is the perception that the state can simply reach out its hand and grab tens of millions of dollars.

Until those two large hurdles are cleared, and there is no guarantee they will be any time soon, it’s all phony money. And it’s the perfect ingredient for cooking up a deal.

That’s because, like the Governor, Democrats have a big incentive to see some sort of transportation bill pass in this session. The Governor came roaring out of the box when the Senate shot down all the transportation bills by labeling Democrats the “party of no.” Since then, the heat has been turned up another notch, with Democrats own words from the 2011 session — when, ostensibly, they held up the state budget because it did not spend enough money on certain transportation projects — being thrown back at them.

Democrats can’t afford to be seen as obstructionists, let alone hypocrites — after all, they have been the ones “moving Virginia forward” lo these many years. They need something, and the only something on deck is the (amended) McDonnell bill.

Enter the phony money.

Rather than have all that online lucre go toward transportation, Republican negotiators, with the Governor’s blessing, allow a portion of it to go toward, say, education (a perennial favorite of Mr. Saslaw). The percentages don’t necessarily matter — the money isn’t real yet, anyway. But each side is allowed to say it got something for its side and each chamber can, however reluctantly, give its blessing. The Governor gets his legacy, the Speaker gets a firmer hand on the caucus and Senate Democrats can say that they not only protected education from the axe, but ensured it a new (though still highly theoretical) money stream.

Most political folks go home somewhat happy.

The wild card in this happy ending, though, is Ken Cuccinelli. The AG has told us that he appreciates what the Governor has done to advance the debate on transportation funding and that something must be done. But the decision to get behind an alternative plan in the Senate, which failed, puts the AG in a ticklish spot with the Governor.

Is Ken on the team? Or is he off to tilt at windmills again? The other party who wants to know, of course, is Bill Bolling, who could benefit from a wedge between the Governor and his would-be successor.

There are any number of possibilities ahead of us — the Democrats could throttle the whole process by amending the McDonnell bill to such a degree that it’s unpalatable to everyone outside the progressive caucus. Or, House Republicans could decide to re-enact the disastrous 2004 session, when the abandoned their no tax ways for some tax increases, which were still less than what the Senate wanted. It’s compromise! What could possibly go wrong?

Or there could be no transportation deal at all and we end up at square one.