By LARRY O'DELL | Associated Press Writer

11:27 AM EST, February 29, 2008

Source: DailyPress

RICHMOND - A state Supreme Court ruling Friday effectively voids the Hampton Roads Transportation Authority as unconstitutional.

In a unanimous opinion, the court said legislators improperly delegated taxing powers to the unelected members of the Northern Virginia Transportation Authority, a key component of legislation passed last year to address the state's traffic problems.

The ruling also affects the Hampton Roads Transportation Authority, similarly constructed to generate money for roads and bridges in that increasingly congested reason.

The law authorized the NVTA to raise $300 million by levying seven regional taxes and fees and issuing bonds to pay for highway projects. The court's ruling invalidates those bonds.

Justice Bernard S. Goodwyn wrote that "the General Assembly has failed to adhere to the mandates of accountability and transparency that the Constitution requires when the General Assembly exercises the legislative taxing authority permitted by the Constitution."

The transportation plan was challenged by Del. Robert G. Marshall, R-Prince William.

"Good intentions alone don't make good government," Marshall said in an interview. "No taxation without direct representation. That's Government 101."

The ruling devastated the 2007 transportation funding law, a collaboration between a legislature then under Republican control and Democratic Gov. Timothy M. Kaine. It was the first substantial increase in state funding for roads in 21 years.

Another feature of the law - prohibitive fines applied exclusively on Virginia residents for egregious driving - is being repealed. Virginians were outraged when they discovered that nonresident abusive drivers were exempt from surcharges that, in most cases, would exceed $1,000.

Kaine called for a swift repeal after learning in January that highway deaths increased sharply despite the fees that had also failed to come close to the estimated $65 million it was expected to generate annually.

A joint statement issued by the governor, Attorney General Bob McDonnell and House Speaker William J. Howell said the next order of business is to find a solution for the loss of hundreds of millions of dollars annually to the state's two most traffic-choked regions.

Howell noted that the statewide portion of last year's funding law remains intact.

Sen. Charles J. Colgan, D-Prince William and chairman of the Senate Finance Committee, said the ruling effectively kills last year's transportation bill and that a special legislative session this year will be necessary to put another plan in place.

Transportation authority officials planned to respond to the ruling later Friday.

The court agreed with Marshall's contention that the Virginia Constitution allows only officials directly elected by the people to levy taxes.

The decision reversed an Arlington County judge's ruling that the Constitution gives the General Assembly broad powers, including the power to create a "special purpose political subdivision" and grant it powers.

The revenue measures took effect Jan. 1 and include new taxes on home sales, car rentals and repairs and hotel-room stays. The new fees include a $10 safety-inspection fee and a $10 regional vehicle-registration fee. Each locality represented by the NVTA also can choose to raise additional revenues by assessing impact fees on new development, imposing additional commercial real-estate taxes or adopting local vehicle-registration fees.

Marshall said the authority should have held off on collecting the taxes until the Supreme Court ruled.

"It was close to thievery what they were doing," he said.

The authority has 14 voting members, including officials from nine northern Virginia jurisdictions, along with two members appointed by the House of Delegates, one member appointed by the Senate, and two appointed by the governor. There are two nonvoting members.