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NORFOLK (AP) -- Gov. Bob McDonnell unveiled a list of transportation proposals on Thursday that call for increased state funding to reduce gridlock, which he says would help boost economic development and create jobs.

Virginia has some of the nation's most congested roadways, particularly in populous northern Virginia and in Hampton Roads, home to the state port and a heavy concentration of military personnel.

'I have lived there and know we've got work to do,' McDonnell told several hundred attendees at the 2011 Governor's Transportation Conference.

McDonnell's proposals to the General Assembly include gradually raising transportation's share of the sales tax from 0.5 percent to 0.75 percent over the next eight years, providing hundreds of millions of dollars.

'We can do it because it's a core function of government. We can do it because we're Virginians and we know that the economy is going to continue to grow and some of that growth should be dedicated to transportation,' he said.

In the upcoming biennial budget, McDonnell said he would propose increasing transportation's dedicated sales tax percentage to 0.55 percent. His office says that increase will generate $110 million in new funding for maintenance. To scattered applause, he said that move would go a long way toward eliminating a projected $350 million transportation maintenance deficit.

McDonnell did not specify which programs might lose money as a result of sales tax money being shifted to transportation. He said more details would be released as lawmakers convene in January.

Some of McDonnell's funding proposals depend on state revenues increasing or there being budget surpluses.

He wants to dedicate the first 1 percent of revenue growth over 5 percent each year to transportation. He said 1 percent of the general fund is equivalent to about $150 million.

McDonnell said he didn't expect revenue growth to exceed 5 percent over the next two years but he said that he's confident it will at some point, citing historical trends.

'If we set priorities and we reprioritize and reform government and make our dollars go further and hold everybody accountable for how those dollars are spent we can allocate certain dollars from the general fund to transportation,' he said.

McDonnell said he also wants transportation to receive 75 percent of year-end surpluses.

Other proposals by McDonnell include expanding the Virginia Department of Transportation's revenue sharing program so that the state matches local spending for maintenance, not just capital improvements.

In other transportation-related proposals, McDonnell wants to create an Interstate 85 economic development zone that would include U.S. 460, which McDonnell wants to turn into an interstate-quality road as an alternate route to heavily congested I-64. Companies in the zone that ship goods through the port or those engaged in maritime commerce could operate income tax free for their first two years in operation.



(Copyright 2011 by The Associated Press. All Rights Reserved.)

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