New Jersey Transportation Committee Chairman Wants to Borrow $3.2 Billion to End Funding Impasse
In hopes of ending New Jersey’s road construction shutdown that has lasted since July 8, Assemblyman John Wisniewski has proposed that the state borrow $3.2 billion over the next two years to restore the Transportation Trust Fund.
Democrat Wisniewski, the Transportation and Independent Authorities Committee chairman, doesn’t believe that his party’s leaders, Senate President Steve Sweeney and Speaker Vincent Prieto, nor Republican Gov. Chris Christie can resolve their long-standing impasse over how to offset the fuel tax hikes of 27 cents per gallon on diesel and 23 cents per gallon on gas that both support. Christie’s plan includes a 1% sales tax decrease, while Sweeney’s phases out New Jersey’s estate tax.
New Jersey’s current taxes of 17.5 cents on diesel and 14.5 cents on gas are the nation’s lowest outside of Alaska and haven’t been raised since 1988.
“Raising taxes is hard and if you cut one, it’s going to be very difficult to restore it,” said Wisniewski, who for years has called for a 25 cents per-gallon fuel tax increase tied to the consumer price index.
However, since that proposal has never gained sufficient traction in Trenton, Wisniewski now is taking a different approach, which he termed “the least bad” of the options to end the crisis.
“It’s clear that this governor is holding the Transportation Trust Fund hostage to an unreasonable and unaffordable tax cut,” Wisniewski told Transport Topics. “His price to get the Transportation Trust Fund back to where it should be is to carve a huge hole in the state budget. We have done that for over a generation, and there’s never enough growth to cover all things that we promise. And the Senate wants to give a tax cut to the super wealthy, 3,500 filers a year.”
So with interest rates having been low for a couple of years and not forecast to soar, Wisniewski wants New Jersey to borrow the money that would fix TTF.
“For at least the last three budget years, the Christie Administration has been using sales tax revenue to fund additional indebtedness to run the Transportation Trust Fund,” explained Wisniewski, who’s worried about thousands of construction workers who have been laid off as well as a number of contractors he said might go bankrupt because of the shutdown. “I’ve never been a fan of just borrowing the money, [but] … if it’s been good for the last three years, let’s do it for two more years until we have a new governor who can address this on a more rational basis. There’s no better time to borrow than right now.”
Wisniewski said his party’s leaders have been neutral on his bill. Spokesmen for Christie and Sweeney didn’t respond to requests for comment. Others were negative.
“I don’t like continuing on the borrowing treadmill, which will add additional costs, requiring an even bigger gas tax increase down the road,” said Democratic Sen. Ray Lesniak, who favors a 25 cents-per-gallon fuel tax hike phased in over three years.
“They should stop kicking the can down the road, or we’ll be facing an even higher tax than the significant increase proposed,” New Jersey Motor Truck Association Executive Director Gail Toth said. “They should also be focusing on ensuring that the TTF taxes are used only to maintain the infrastructure: Close the loopholes that prevent them being used for other needs.”
