Transportation Trust Fund Boost Approved by N.J. Legislative Committees
The transportation committees of the New Jersey Assembly and Senate overwhelmingly passed 10-year, $23 billion bills that would bolster the state’s Transportation Trust Fund. The full chambers must vote on the measures before the fund’s borrowing authority expires July 1.
The legislation is funded in part by a 27-cents-per-gallon tax hike on diesel and a 23-cents-per-gallon increase on gas. If the plan becomes law, the increase would vault the state from among the nation’s lowest taxes on diesel (17.5 cents) and gas (14.5 cents) to among its highest.
Gov. Chris Christie has termed the fund “obsolete.” Senate President Steve Sweeney and other Democratic lawmakers have warned that the $1.6 billion fund is nearing insolvency, an idea that Christie, a Republican, called “crap” before vowing not to sign a fuel-tax hike unless it produces “tax fairness” for New Jersey residents.
“The Legislature says they’re for better roads and bridges and for more mass transit funding,” Christie said at a press conference. “Maybe they should have to choose inside the general fund about how to do that rather than just asking the people of the state for more money every time they want to do something.”
To add about $2 billion per year to the fund, the diesel tax will soar from 17.5 cents to 44.5 cents per gallon and the gas tax from 14.5 cents to 37.5 cents per gallon. While the gas-tax increase was scheduled to go into effect July 1, the bill delays 16 cents of the diesel tax hike until January and the other 11 cents until July 2017. To gain Republican backing, the plan would phase out New Jersey’s estate tax by 2019, a move that Christie supports.
The Democratic-dominated Legislature might well have the votes to override a gubernatorial veto, said Brigid Harrison, a political science professor at Montclair State University.
“The governor has argued that this is a media-created deadline, but if the trust fund runs out of money it has very real implications,” Harrison told TT, citing the numerous projects whose construction would be jeopardized. “There’s a widespread consensus from the Chamber of Commerce, business and industry associations and people within each political party that something has to be done. The governor’s lack of popularity in the state may actually be driving some Republicans to defy him.”
It didn’t hurt the cause of those pushing to rescue the fund that the American Society of Civil Engineers recently gave New Jersey’s roads and bridges both D+ grades. And Gail Toth, executive director of the New Jersey Motor Truck Association, noted the state must come up with a 20% match to receive its full FAST Act funding.
“Rumor has it that both parties want this [issue] to go away this year because they don’t want it to interfere with next year’s gubernatorial race,” Toth said. “Everyone wants their hands clean real quick. And the reality is, if you want anything done this year, you’ve gotta get it done by June 30. It’s not so much that the trust fund will go bust, but all the money coming in will go to debt [service] so you can’t do anything else.”
