Governor Chris Christie put forward today a five-year transportation capital plan that avoids new or increased taxes and consists of cash contributions from the General Fund and the New Jersey Turnpike Authority, bonding and $1.8 billion in projects requested by the Governor to be undertaken by the Port Authority of New York and New Jersey (PANYNJ) in conjunction with the State Department of Transportation.
The governor said the state would be able to provide $1.6 billion each year for five years for much-needed transportation projects throughout New Jersey, including $672 million for New Jersey Transit capital needs and $200 million per year for local government projects.
“Today, we are continuing to put New Jersey on the path towards fiscal health and proposing a sensible and responsible plan that prioritizes vital transportation projects, while limiting the already-heavy debt burden carried by the taxpayers of our state,” Christie said. “After years of mismanagement and the failure to soundly plan for New Jersey’s transportation future, we were left with an unacceptable situation – a system teetering on the edge of failure, without the ability to fund a basic, core function of government. Today, we begin to end that practice by putting forward a Transportation Capital Plan that meets our infrastructure needs and responsibly manages the debt incurred by taxpayers.
“Most importantly, ensuring these critical transportation projects move forward will create thousands of Jersey jobs. By responsibly investing in projects over the next five years we’re putting New Jerseyans to work now and in the future,” the governor added.
Christie touted the “pay as you go” portion fo the plan, which will rise 1,600 percent – from $38 million in 2011 to $605 million in 2016. Left unclear is where the additional $567 million in revenue will come from. Christie said there is additional money that is constitutionally dedicated to transportation that currently flows into the state’s general fund that will now be dedicated to the TTF. But that money is used to fund Department of Transportation operations and the governor would not say what cuts would be required as a result of the shift in funding.
But the governor may never have to worry about those cuts as the general fund money does not begin to transfer until 2014, which would be the firts year of Christie’s second term.
Assembly Speaker Sheila Oliver (D-East Orange) promptly panned Christie’s plan to borrow more than $4 billion to fund half of his $8 billion proposed transportation plan.
“The governor has slapped together a haphazard plan to fund the state’s transportation needs that relies on many of the same gimmicks he has derided others for,” said Oliver. “With more than half of the $8 billion dollar plan funded by irresponsible borrowing, one would have to question the suspect timing of this announcement. This is not what the governor had promised to do. Instead of putting forth an innovative proposal to address our critical transportation needs, the residents of this state will simply be saddled with debt. Moreover, nearly a quarter of the funding plan relies on yet obtained approval from the Port Authority of New York and New Jersey.”
Assembly Transportation Committee Chairman John Wisniewski added his own critique, saying Christie is not being honest when he claims the plan will not raise taxes or revenues. Much of the money used for the five-year plan will come from toll hikes approved two years ago to fund the ARC Tunnel, which Christie nixed last fall, he said.
“The toll increase was supposed to go to pay for the ARC tunnel, which was supposed to take cars off our roadways” said Wisniewski, who is also the Democratic State Party Chairman. “Now, motorists on the PArkway and Turnpike will instead be forced to pay to repair roads they never use.”
In his press conference announcing the plan, Christie addressed the toll increase, saying it was already approved money and was not done to pay for the plan introduced Thursday.
Wisniewski also questioned Christie’s figures on borrowing. According to figures released by the administration, the state would borrow nearly $4.4 billion over the five years. But according to Wisniewski, the Port Authority portion of the funding as well as the Turnpike Authority revenue is already borrowed money against toll revenue.
“What they are doing is using money that was already borrowed and calling it cash,” he said.
The Governor has asked the PANYNJ to undertake the following critically important transportation projects in the Port District that link the Holland Tunnel and the Port:
- Pulaski Skyway;
- Wittpenn Bridge: The Route 7 Wittpenn bridge is a major connector in Kearny between Routes 139 and 1&9 Truck to the east, and the NJ Turnpike Interchange 15W to the west;
- Route 139: Route 139 links the Holland Tunnel, Routes 1&9Truck, the I-78 NJ Turnpike extension, and local roadways in Jersey City and Hoboken, and;
- Portway New Road: The proposed roadway will connect St. Paul’s Avenue along the CSX railroad crossing over New County Road and terminating at Secaucus Road in Jersey City.
“As we have learned with so many other issues in New Jersey, our most pressing challenges simply will not fix themselves,” concluded Governor Christie. “Just as we will not simply drift by chance into balanced budgets or stumble into a less costly, more efficient government, transportation investment in New Jersey requires discipline and careful planning to meet our needs in a realistic and fiscally responsible manner. The plan outlined today meets these challenges and ensures that the state will succeed where prior funding schemes have failed.”
The former plan, which is about to expire, began in Fiscal Year 2007 and provided $8 billion ($1.6 billion per year) for transportation projects, including $200 million per year for local government projects, according to the governor’s office. The plan relied on a stable $895 million annual General Fund appropriation that became almost entirely devoted to making debt payments, instead of funding current transportation needs.
Christie touted his plan as a reversal. Over each of the next five years the Christie Plan will increase cash contributions used to fund transportation projects while at the same time decreasing the use of borrowing.
According to the governor’s office, “the Christie Plan includes approximately $1.8 billion in ‘pay as you go’ cash contributions growing from a nominal amount under the former plan to over $600 million by the end of the five-year term. This represents a substantial increase in the amount of cash financing (1,600% over five years) and is a marked departure from the previous policy of borrowing money and running up debt. Over the plan’s five year period, the Christie Plan provides almost 37 percent pay as you go funding in contrast to the former plan’s five-year PAYGO composition of 10.6 percent.
“The Christie Plan will include the sixth successive reauthorization of the Transportation Trust Fund. Trust Fund borrowing is backed by State appropriations from constitutionally dedicated revenue streams (from the Motor Fuels Tax, the Petroleum Products Gross Receipts Tax, and the Sales and Use Tax). Since the voters approved the constitutional dedications, there is no legal requirement for additional voter approval under the Debt Limitation Clause. Instead, the Legislature establishes bonding authority (i.e. authority to borrow up to a specified amount) and makes annual appropriations fr
om constitutionally dedicated revenues.”
