Christie and state government disagree on transportation trust fund
New Jersey lawmakers are vowing to move ahead with legislation establishing a 10-year, $20 billion fund for road and bridge work that includes a 23-cent fuel tax hike in exchange for other tax cuts, but Gov. Chris Christie is not on board yet.
Senate President Steve Sweeney, along with Senate Democratic and Republican colleagues and Assembly Majority Leader Louis Greenwald, said Monday the legislation is on a fast track and they're hopeful Christie and Assembly Speaker Vincent Prieto will get on board.
"This is an investment in jobs and economic growth," Sweeney said. "We can't afford to not address this need."
But Christie told a business group on Monday that the notion the state's $1.6 billion transportation trust fund is going broke is "crap," and that he had a chance to review the plan, which he says he and lawmakers will be discussing in the coming weeks.
He did not lay out how he would keep the fund afloat.
"I've said all along I will not sign a gas tax increase unless it represents fairness for the people of New Jersey," Christie said.
The debate comes as the transportation trust fund is set to run out of authority for new borrowing on July 1 unless the Democrat-led Legislature and Republican governor reach a deal. It also comes after lawmakers from both chambers introduced competing plans on Friday to pump cash into the fund and keep it solvent for a decade and after more than a year of hand-wringing over how to proceed.
The Senate plan, which has Republican support, calls for increasing the fund from $1.6 billion to $2 billion per year. It would raise the wholesale fuel tax from 14.5 cents to 37.5 cents, but phase out the estate tax and increase an exemption for retirement income for those earning $100,000 or less from $20,000 per couple to $40,000, eventually ramping up to $100,000 by 2020.
The proposal also includes a charitable tax deduction, which currently does not exist in New Jersey, and would increase the earned income tax credit, which benefits low-income earners, from 30 percent to 40 percent. Lawmakers say the tax cuts will be offset by reallocating revenues from sales tax collections.
An Assembly framework unveiled Friday by Prieto called for similar changes, but included fewer details.
Prieto says he looks forward to working with colleagues to get legislation to Christie by the end of the month.
Christie wants to change the four-year phase-out of the estate tax to two years. He also suggested the state's real estate transfer taxes are unfair and faulted the lawmakers' proposals for not saying exactly how money would be spent.
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