I see that many republicans did not sign the tax pledge. I know, they don't want to be "trapped" just in case they do raise taxes and will have to explain signing the pledge the next time the run.
Some GOPers might not have said NO but; guess which party will be behind any hike in gas taxes.
Hike in gas tax, though needed, seems doomed
11.14.03
EDITORIAL
It looks as though the first order of business for the lame-duck session of the New Jersey Legislature will be a proposed hike in the state's gasoline tax, now among the lowest in the nation.
This is a matter that should be decided — as most serious matters of public policy, particularly tax policy, should be decided — on the basis of research, analysis and reasoned discussion. Instead, the gas-tax debate will almost surely come down to a theatrical display of political posturing.
Few reasonable people can look at New Jersey's current fiscal condition and tax structure and not conclude that an increase in the gasoline tax is long overdue. As a corridor state, New Jersey has an unusually large number of out-of-state motorists passing through on their way to New York and points north, or Philadelphia and points south. A great many of them stop to buy gas here. Yet the Garden State fails to take advantage of its geography by levying a hefty tax on these out-of-state drivers. Instead, we pay the highest property taxes in the nation, leaving the clear message that we would rather impose the growing cost of government on our own property owners than on visiting motorists.
We could understand maintaining an artificially low gasoline tax if there were any evidence that New Jersey benefits from it — if, for example, someone could show that large numbers of Pennsylvanians or New Yorkers slip across the border to take advantage of cheap New Jersey gas. But there's no evidence of this at all. In fact, most New Yorkers and Pennsylvanians plainly prefer to gas up in their own states, where they can pump it themselves, rather than submit to the time-consuming "full service" one must endure at a New Jersey station.
So why does New Jersey, at 14.5 cents a gallon, have a gasoline tax that is nearly 8 cents below the national average? Only three states — Wyoming, Alaska and Georgia — have a lower gasoline tax. Forty-six states plus the District of Columbia impose higher gasoline taxes, from Florida's 16.3 cents all the way up to New York's 32.5 cents. Among other states in the Northeast, Rhode Island (31 cents), Pennsylvania (26.9), Maine (26.05), Connecticut (25), Delaware (23), Massachusetts (23.5), Vermont (20), even live-free-or-die New Hampshire (20.6) all have substantially higher gasoline taxes than New Jersey.
None of this would matter, of course, if New Jersey had neither a budget problem nor a transportation infrastructure problem. The fact is we have both, and revenue from a gasoline tax that is more in line with that of other states would go a long way toward not only easing the state's severe budget crunch but also replenishing the depleted Transportation Trust Fund, which is in danger of running out of what little money it has for maintenance and repair of highways, bridges and tunnels all across the state.
Normally, the lame-duck Legislature would be an ideal vehicle for driving a tax increase of any kind. For one thing, the whole process can be orchestrated in such a way that the deciding vote is cast by a lawmaker who won't be in office when the new Legislature convenes. For another, lame-duckery means the entire blame for increasing taxes can conveniently be passed along to participants in a legislative session that will cease to exist in January.
But after the election just passed, these are not normal times. The Republicans, licking their wounds following a legislative defeat they managed to snatch from the jaws of certain victory, are in no mood to make life any easier for the Democrats who will control the governorship and both houses of the Legislature for the next two years. And to get a bill out of the lame-duck Senate, which is still evenly divided at 20 seats apiece, at least one Republican will have to be persuaded that the fiscal interests of the state supersede the electoral interests of the party.
What are the chances of that happening? Let's put it this way. New Jersey motorists pumping their own gas may be a likelier occurrence.
http://www.zwire.com/site/news.cfm?BRD=1091&dept_id=425732&newsid=10514058&PAG=461&rfi=9 Talk of gas tax hike must be silenced
EDITORIAL
Property taxes and ethics reform concern New Jersey residents the most.
So what does the McGreevey administration do? It floats a trial balloon on raising the gasoline tax anywhere from 7 cents to 32 cents a gallon. Trenton needs to get its priorities straightened out.
Before the election, candidates talked about relieving the tax burden on residents, who pay $51 out of every $1,000 of income on local taxes, second only to New York in the nation. Ethics reform also took center stage. Democrats and Republicans agreed that banning nepotism and no-bid professional contracts and ending pay to play -- the practice of awarding contracts to campaign contributors -- had to be addressed, either in a special session before Election Day or during the lame-duck session.
Where are those voices now? With the exception of a handful of lawmakers, the silence is deafening. It's simply outrageous that McGreevey and the Legislature are considering a gas tax increase ahead of these issues and before cutting waste. The state budget is $23.7 billion this year. Counties, schools and municipalities will spend about $28 billion. A 10-cent gas hike would raise about $500 million. We're confident that McGreevey and the legislators can find enough duplication and waste in the billions being spent to keep the Transportation Trust Fund solvent without the extra cash.
Trenton must pass legislation eliminating worthless agencies and commissions and consolidating school districts. Passing pay-to-play legislation alone could save taxpayers millions of dollars. And don't even get us started on the light rail line between Trenton and Camden that will cost taxpayers $1 billion to build and operate for 10 years, not to mention the patronage and waste involving the independent transportation and bridge authorities.
Taxpayers are already straining under the weight of local taxes, and the economy is still in the doldrums with unemployment in Cumberland County hovering at 8 percent. This is not the time to be asking them to pay more.
It appears the lame-duck session will be just that, with the people's business being put on hold until the newly-elected Democrats are sworn in in January and the party takes control of the Senate and increases its majority in the Assembly. The campaign fever for reform has cooled now that legislators are secure in their seats for at least another two years. We mustn't allow them to get too comfortable.
In The Daily Journal's Interactive Poll on the Internet, more than 75 percent of the 381 readers who responded said no to paying 10 cents more for a gallon of gas to fund road improvements, and 16.5 percent they would -- but only if South Jersey received its fair share such as extending Route 55 to the Garden State Parkway. Lawmakers must listen.
Tell the governor and legislators that the people's business can't wait. Demand that Trenton tighten its belt, provide property tax relief and clean up government. Tell them to forget the gas tax hike.
http://www.thedailyjournal.com/news/stories/20031115/opinion/644487.html CONSTRUCTION FUND FOR HIGHWAYS, MASS TRANSIT HITS BUMPS
By MICHAEL SYMONS
GANNETT STATE BUREAU
TRENTON -- The New Jersey Transportation Trust Fund is broke, state officials lament. In 15 months, they say it will be insolvent. They say the state gasoline tax must be raised to prevent that.
Cars wait at the pumps at a Raceway gasoline station on Route 37 in Toms River. Plan to bail out the transportation trust fund is likely to call for hefty increase in gasoline tax.
But critics say the trust fund is broken, as well. Created nearly 20 years ago to provide a reliable source of money to finance long-term road and rail construction, the fund once again is choking on its own debt.
The fund was supposed to be self-replenishing, but instead it has accumulated nearly $6 billion in debt. In two years, annual debt payments will consume nearly every dollar constitutionally dedicated to transportation. And the state continues to borrow to pay for most of its transportation needs. Bond revenue will pay for 72 percent of transportation construction this year.
Since the trust fund was last renewed, in 2000, the state has diverted nearly $344 million in taxes and fees to balance the state budget. It has exceeded spending limits in the trust fund law by $593 million, and it has used skyrocketing debt to pay the difference.
Also, state officials spend millions from the Transportation Trust Fund to pay for routine operations, maintenance and salaries. "Capitalized maintenance" this year will cost $300 million between the state Department of Transportation and New Jersey Transit. Salaries paid for by the Transportation Trust Fund will run $90 million. The trust fund was established to finance major road and bridge projects and transit equipment, not routine maintenance and payroll.
"It's a system that's totally broke. It's got more holes in it than Route 1 and 9," said Jeff Tittel, director of the New Jersey chapter of the Sierra Club, who says any changes, such as new taxes, should be approved by voters.
Spending patterns have been similar under Democratic and Republican administrations. The financial maneuvering began in 1991 under Gov. James J. Florio, continued under Gov. Christine Todd Whitman has been used by the administration of Gov. McGreevey to help balance budgets.
Transportation Commissioner John F. "Jack" Lettiere Jr. doesn't dispute that the trust fund needs changes, and he hopes the reauthorization that will be considered in the lame-duck Legislature accomplishes that.
That same reauthorization, however, is likely to cost drivers a sizable increase in gasoline taxes. Now 14.5 cents per gallon if a tax on wholesalers is included, an increase of more than 50 percent is considered likely.
"We have made a significant investment in transportation in this state, and we've abused it. We've abused it from a use perspective, and we've abused it financially. It's time to do the right thing and get our finances in order," Lettiere said.
Lettiere recently said an increase of 15 cents per gallon would be needed to fund a capital program equal to the current one. That figure, which wasn't a formal proposal, was quickly rejected as too large by McGreevey.
If gas taxes were increased by 10 cents per gallon, drivers who fill their tank with 15 gallons of gas twice a week would pay an extra $3 a week for fuel, equal to more than $150 extra per year.
The state is spending $2.65 bil-lion on transportation projects in 2003-04. That includes $1,228,200,000 in New Jersey Transportation Trust Fund money, $1.12 billion in federal money and $229 million from other sources.
When the trust fund was creat-ed, short-term debt was sup-posed to provide a small part of the annual transportation spending. Most spending was supposed to be "pay-as-you-go," meaning taxes deposited in the fund would mostly be used to pay that year's expenses.
But in 1991, faced with a budget deficit and a recession, Florio convinced lawmakers to boost transportation spending to prop up the economy. He also was allowed to pay engineers' salaries from the trust fund, which had been prohibited un-til then.
What began in 1984 as a $250-million-a-year spending pro-gram increased to $565 million in 1991 with no added taxes devoted to paying for the jump. Spending limits increased to $700 million in 1995 and $950 million in 2000, with existing taxes -- but no new revenue -- set aside for the fund.
Those spending limits them-selves have been rendered mostly irrelevant. The limits have been exceeded eight times since 1991, including each of the last three years, because the annual budget can super-sede older state laws.
Not only has the fund spent beyond its apparent limits, but some of the money has gone toward such items as road striping, signs, snow removal and chain saws. In the 1990s, the state also refinanced its 10-year debt as 20-year bonds -- lowering payments, but push-ing them into the future.
The use of Transportation Trust Fund money to pay what could be considered operating costs bothers some lawmakers, including Assemblyman Alex DeCroce, R-Morris, newly elect-ed Assembly minority leader.
DeCroce said the state used trust fund money to spend $699 million on salaries and $606 million on "capitalized mainte-nance" between 1991 and 2000. That tradition has continued under McGreevey, he said.
"It uses a lot of money for sala-ries and operating expenses, and that's not necessarily what the trust fund was all about. The trust fund was about capi-tal programs, and it's a jobs program. That's what it was always meant to be," DeCroce said.
In 2000, lawmakers tried to curb spending on salaries and maintenance, but Whitman conditionally vetoed the bill in part because of that clause. The Assembly had to return for a rare summer session to go along with weaker limits the governor proposed.
Lettiere estimates that $300 million in state and federal funds will be spent on "capital-ized maintenance" this year by NJ Transit. He says the habit compounds the fund's financial problems, but that the repairs must get done.
"We're not getting those funds appropriated every year in our operating budget. When a sig-nal goes down, I've got to fix it. So our capital dollars are being used for traffic signal repair, drainage repair, fixing the tracks, painting a train station, things of that nature," Lettiere said.
Lettiere says taxes constitu-tionally dedicated to transpor-tation should instead be specifi-cally committed to the trust fund. That would ensure that money goes to long-term con-struction with life spans of at least five years.
"We try to pay for all those things out of the pay-as-you-go portion. We try to keep some legitimacy to this thing," Let-tiere said. "But the fact of it is, that's motor fuels tax money for which people thought they were going to get a capital im-provement."
New Jersey lawmakers are ex-pected to consider an increase in state gasoline taxes during the lame-duck session begin-ning next week. A commission McGreevey appointed, due to finish its work soon, will influ-ence the size of the tax increase McGreevey will seek.
The commission met Friday but didn't reach a consensus. Lettiere said the commission has considered ways other than gas taxes to continue the trust fund but decided none could raise enough money. The ideas included mortgage recording fees and tire taxes, he said.
Businesses don't mind paying gas taxes -- if the money goes for projects, not to offset budget costs, said Philip Beachem, president of New Jersey Alli-ance for Action, a consortium of business, labor, government and academic leaders that sup-ports transportation spending.
"It depends on what they call capitalized maintenance," Be-achem said. "It may have gone to a little bit too much of an extreme. If it's an expense cor-rectly associated with a project, that's one thing, but if it's just paying operating costs, that's another thing."
New Jersey has one of the low-est gasoline taxes in the nation, 14.5 cents a gallon. The at-the-pump tax is 10.5 cents per gal-lon, and the state also charges a tax equal to 4 cents a gallon on petroleum refiners or dis-tributors, which is passed on to consumers.
Diesel fuel is taxed at a rate 3 cents higher, but the extra money is refundable for fuel used in passenger cars and in motor vehicles that weigh less than 5,000 pounds. No tax is collected on sales to the federal or New Jersey governments.
Each penny of gasoline taxes costs drivers in New Jersey nearly $52 million, cumulative-ly. The total amount of gas tax-es estimated for the 2003-04 budget year is $544 million, with $405 million dedicated for transportation and the rest go-ing into the general fund.
Georgia has the lowest gas tax, 7.5 cents per gallon. But it is also one of 35 states that charg-es sales tax on gasoline pur-chases, and that 4 percent tax raises its effective tax rate clos-er to the level of New Jersey's, which doesn't apply the sales tax.
The second lowest tax rate is 8 cents per gallon in Alaska, which has the nation's least ex-pensive gas tax because it doesn't apply sales tax to gaso-line. The next lowest are 13.6 cents in Florida and 14 cents in Wyoming.
The median gasoline tax in the United States is 20 cents per gallon, meaning half the states charge more and half charge less. The highest gasoline tax is charged in Rhode Island, 29 cents per gallon.
The trust fund's current debt is just under $6 billion. This year, the payment on that debt for interest and principal is $453 million. The state also is pay-ing an added $83 million this year for debts incurred when NJ Transit bought light-rail trains.
This year transportation debt of $536 million, that equals 67 percent of the $805 million in gasoline taxes, wholesale petro-leum taxes and sales taxes on vehicles dedicated by the state constitution to transportation.
The balance of the $805 million is used to help fund this year's transportation projects. That isn't nearly enough to cover the $1.2 billion plan, so about 72 percent of this year's construc-tion will be funded by debt.
Assemblyman John Wisniews-ki, D-Middlesex, who heads the Assembly budget committee, said the trust fund isn't going broke. Officials, setting up the funding mechanism, intended that the Legislature reconsider how to fund it after June 2004, he said.
But Wisniewski agreed with Lettiere that an increasing amount of the Transportation Trust Fund spending should come from current revenues rather than bond sales. Lettiere wants half the funding eventu-ally to come from taxes.
"We have to balance it, but I haven't personally settled on what a good formula is," Wis-niewski said. "But certainly having a little more pay-as-you-go than you do now would be a good thing."
But the debt service is project-ed to spike quickly, then peak in 2015. In two years, say De-partment of Transportation documents, trust fund debt ser-vice will be $737 million. Com-bined with NJ Transit debt, there would be little left over for new projects.
"The debt has caught up with us," Lettiere said. "Through all these decisions over time, which I would say put off the inevitable of raising some kind of revenue that is constitution-ally dedicated, we're in a posi-tion now where in less than 18 months, every nickel we collect in motor fuels tax will go to pay debt. It's like paying off your credit cards and having no money to feed your family with."
http://www.app.com/app2001/story/0,21133,856267,00.html GASOLINE-TAX INCREASE
Hike needed, but ...
How refreshing it would have been to have heard this debate during the last campaign:
Politician A: "New Jersey's roads and bridges need maintenance, repairs and improvement. We are a congested state dependent on our transportation system. The Transportation Trust Fund is running on empty. And the fairest way to finance roadwork is to increase the gasoline tax - a tax paid by the motorists who use the system, including many from out of state.
Politician B: "New Jersey doesn't need an increase in a tax that hits the little guy. Sure, we have one of the lowest gas taxes in the nation, and there's nothing wrong with that. So, what is the alternative? Don't do as many improvements - and understand that means bumpy roads and increased congestion. Or increase the progressive income tax to free up more money for road and bridge repairs."
Yes, it would have been nice to have heard an honest, grown-up debate like that. Instead, we had politicians calling each other ethical bottom-feeders or McGreevey clones.
But less than 48 hours after the polls closed, politicians were talking openly about raising the gasoline tax as much as 10 or 20 cents. This, after both parties were dead silent on the issue during the campaign. Public cynicism - even outrage - is understandable.
All that being said, a hike in the gas tax is overdue. Our hypothetical Politician A is correct - it is the fairest way to fund needed transportation improvements and maintenance. Politicians and policymakers have known that for years.
In 1998, then Gov. Christie Whitman suggested raising the gasoline tax 5 cents to help fund transportation improvements. Petrified legislators refused. In 2002, a liberal think tank called for a 10-cent hike. Nothing happened.
In 2000, a Rutgers University study said the state needed to raise the gasoline tax by 5 cents per gallon to help fund its four-year transportation-improvement program. Otherwise, said the study, in four years the state would probably have to raise the gas tax by 10 cents.
Here it is, nearly four years later ...
There's no question some increase in the gasoline tax is needed. How much will be the subject of debate during the next few months.
It's just a pity that debate didn't happen sooner.
The fact that politicians won't talk to voters like grown-ups during an election corrodes public trust and is at least part of the reason for the dismal turnouts at the polls. After all, why vote when the real issues that affect people aren't broached until a few hours after the election is over?
http://www.pressofatlanticcity.com/news/columns/111603GASTAXHIKE.html
btw, Coleus, another very solid, thoroughly researched post (as we've come to expect;)
Couldn't agree more. You get what you elect. I hate living here. Someday I'll be outa this pit of a state.
