Labor and Advocacy Groups Disagree on Future of TTF

Sweeney in his statehouse office in Trenton.

Sweeney in his statehouse office in Trenton.

While Senate President Steve Sweeney did not post the Transportation Trust Fund (TTF) package for a vote in the senate today, a number of groups issued statements of either support or concern for the package ahead of the senate session where it was believed the fate of the gas tax would be decided.

Those groups came from both sides of the aisle with highly varied viewpoints on what a 23-cent per gallon bump in the gas tax paired with a reduction of the sales tax to six percent would do for New Jersey residents (A12). Initially, it the TTF funding bill was paired with the bipartisan senate backed A11 which made cuts to the estate tax. However, late on Monday night, the assembly passed A12, a new bill that was  hammered out by Governor Chris Christie and Assembly Speaker Vincent Prieto, without consulting members of the senate who had been fighting for A11.

Grover Norquist, president of the conservative group Americans for Tax Reform, issued a letter on Wednesday supporting the Prieto/Christie compromise.

“The tax reform package is not a tax hike,” the letter read. “The November ballot measure that would require that all gas tax revenue go only to transportation will further protect NJ taxpayers.”

According to Norquist, increasing the gas tax while simultaneously cutting the sales tax and income tax on pension over a four-year period for all income under $100 thousand will provide substantial relief for NJ taxpayers.

However, not all were so supportive of the measures in A12. Jeff Tittel, director of the New Jersey Sierra Club, said that the when the governor stuck the deal with Prieto, “Christie sold the Brooklyn Bridge to the Assembly and now he’s trying to sell it to the Senate.” According to Tittel, while the Sierra Club thinks a boost to the gas tax is a good step, the A12 plan does not secure New Jersey’s future enough to warrant passing it.

“This plan will cause higher property taxes, layoffs of state workers, and cuts to important programs. We will see cuts in environmental protection and education across the state,” Tittel wrote. “[Christie’s] plan to attach a gas tax to a reduced sales tax is a sell-out that’s going to drive New Jersey into financial ruin. This plan is irresponsible and will mean big budget deficits and cuts to important programs that effect New Jersey citizens every day. The tax cut is permanent while the bill only funds the TTF for the next ten years. We would like to see a raise in the gas tax, but this plan could end up cutting funding for programs that help our schools, clean air, and clean water.”

Tittel also claims that Christie is “trying to pit the Senate vs the Assembly.”

For the New Jersey Business & Industry Association (NJBIA) A12 does not go far enough due to the lack of reduction of the estate tax.

On Wednesday, the group released a statement saying that they are “appreciative” that a plan is being discussed “that balances the state’s need for infrastructure improvements with much needed tax relief.” However, they are not pleased with A12. The statement read: “However, the bill approved by the Assembly early Tuesday morning did not contain a phase-out of the estate tax and, therefore, does not provide the comprehensive reform that NJBIA continues to call for. NJBIA continues to strongly support estate tax relief. It is a common misconception that the estate tax only benefits the wealthy. In fact, the estate tax has a broad impact on the state’s economy and business succession planning, particularly for family-owned businesses.”

The group also claims that keeping the estate tax would only prolong New Jersey’s outmigration problem.

According to the National Federation of Independent Business, no gas tax is a good gas tax.

“A one percent reduction in the sales tax slowly phased in over 18 months will barely be noticeable to tax payers and will do nothing to offset the drastic increase in the gas tax that will immediately impact anyone in New Jersey buying gas. Elected officials on both sides of the aisle have failed to address the fundamental issues that exist with funding infrastructure improvements in our state and until they are willing to tackle the larger scale issues, our state economy will continue to suffer as our politicians pave the streets of Trenton with more and more poorly spent tax dollars,” said the group in a statement released on Wednesday.

For the Engineers Labor-Employer Cooperative (ELEC), the most important thing for the future of New Jersey is getting a TTF plan passed.

The group issued a statement on Thursday ahead of the senate session to call for a resolution. The group claims that a failure to fund TTF will lead to a work stoppage around the state, and a loss of federal matching funds for New Jersey. The statement read: “If we go past today without a plan to replenish the fund, projects to repair and maintain roads and bridges throughout the state will come to a halt, posing an immediate safety hazard to New Jersey residents. There will be absolutely no funds to maintain the 596 “structurally deficient” or 1,714 “functionally obsolete” bridges throughout the state.”

“Every community in New Jersey will feel the effects if we allow today to go by without a plan to fund the TTF,” said Greg Lalevee, Chairman of ELEC. “From small potholes in local communities like Mountainside to major roads like Route 124, no part of the state will be spared from this self-inflicted transportation crisis.”

According to liberal think tank New Jersey Policy Perspective, the tax cuts proposed by A12 will save New Jersey families about $92 per year but will create a $1.7 billion hole in the state budget. The senate and assembly will likely look for a compromise in the coming weeks between the two plans.