... why cant we utilize digital VHF/UHF like the Virginia STARS system? or is there a higher cost to it then its 800Mhz counterpart?
There is nothing to prevent an agency from constructing a P25 trunking system on VHF or UHF, rather than 700 or 800 MHz. Wayne County is a good example for VHF trunking, and they have two circumstances going for them that should help the implementation: they were already licensed / coordinated for some of the system frequencies, and they are using the same frequencies at each site.
As the coverage area of a potential VHF or UHF trunking system grows, so do the problems of coordinating frequencies with other users in the region who are already on the same or adjacent frequencies. And the normal propagation characteristics of VHF and UHF, when compared to 700 and 800 MHz., add to the headaches.
The people involved in the planning and implementation of the STARS system had the good fortune of applying for VHF frequencies at a time when VHF splinter channels were still relatively unlicensed. They are now also licensed for numerous frequencies in the 152.5 - 152.8 MHz segment, which was originally available to commercial mobile phone services in the pre-cellular phone days.
I can only think of two other states that have deployed VHF trunking on a statewide level - Alaska and South Dakota.
With regards to 700 and 800 MHz., there is no reason to make 800 MHz. "obsolete" ... unless the F.C.C. decides to auction off more spectrum. The 700 MHz. spectrum is intended to enhance interoperability, and each "region" will have a coordinated plan on file with the APCO regarding how agencies within its boundaries will use the 700 MHz. allocations within the spectrum. A similar plan exists for 800 MHz.
(A "region" consists of a state or U.S. territory, a group of states, or a portion of a state that coordinates use of a portion of radio spectrum within its boundaries. North Carolina is Region 31. The chairman of the Region 31 700 MHz. planning committee is a subscriber and occasional poster on the N.C. Forum on RR, btw.)
Although some hobbyists think of 700 MHz. as a separate entity from 800 MHz., frequencies from both bands can be used at the same trunked site when compatible transmitting and receiving equipment is in place.
For instance, Lake County, Fl. operates a multi-site P25 system with 700 and 800 voice channels being allocated by an 800 MHz. control channel.