Should all gas tax money be spent on transportation? Guarantee inches forward

Although talk of a gas tax hike to replenish the soon-to-be bankrupt Transportation Trust Fund (TTF) has dominated the State House for well over a year, no deal has been reached.

But that did not stop the legislature Thursday from seting the stage to ask voters to ensure all revenue from the state’s gas taxes permanently goes toward improving New Jersey’s transportation infrastructure.

Thursday, the Assembly Judiciary Committee unanimously approved a measure (ACR-2) to put the question on the ballot.

“What we’re not doing now is adding to the gas tax or doing anything to re-collateralize the Transportation Trust Fund,” said bill co-sponsor, Assemblyman John McKeon (D-Madison). “What this does is perhaps set us up for what might be an inevitable decision as it relates to raising the gas tax.”

The legislation is also co-sponsored by Assembly Speaker Vinnie Prieto (D-Secaucus). He said discussions about how to replenish the TTF will continue, but voters must have the confidence that however the revenue is raised, it will be dedicated solely to transportation funding. The TTF is on pace to run out of money at midnight on June 30, 2016.

“New Jersey drivers want to know every cent they pay in taxes at the pump is being used appropriately. This gives them that assurance, and strengthens any future effort to ensure we have enough transportation funding to keep our state strong,” said Prieto in an emailed statement.

Fuel tax and legislation facts:

• New Jersey’s gas tax is 10.5 cents per gallon on regular gas, and 13.5 cents per gallon tax on diesel fuel.
• The full gas tax is already dedicated to transportation, while 10.5 cents of the diesel tax also goes to the TTF.
• ACR-2 would include the 3 cents of the diesel tax that is not dedicated now.
• Under ACR-2, all money raised by fuel taxes would be constitutionally dedicated to the TTF, even if the taxes are increased.
• ACR-2 would also dedicate all of the revenue from the tax on gross receipts of the sale of petroleum products to the TTF.

The New Jersey Business and Industry Association (NJBIA) signaled its approval for the legislation at Thursday’s hearing and later emailed a statement.

“NJBIA supports the proposed constitutional amendment dedicating the motor fuels and petroleum products tax revenues to transportation.  If taxes are levied for a specific purpose, we should make sure that the funds are used effectively and efficiently for that purpose,” wrote NJBIA president Michele Siekerka.

The resolution would have to pass both houses of the legislature this year and next in order to be placed on the ballot in November of 2016.

“Hopefully with the voice of the people in lock-boxing even more of this sum and the intestinal of the members of this legislature we’ll, in short order, deal with this long-standing problem,” McKeon said.

There was opposition raised by the environmental community. New Jersey Sierra Club director Jeff Tittel emailed a statement after the measure was approved.

“We cannot support the constitutional dedication for to fund TTF until we know how the money will be spent. Our bridges are falling down, we have roads in disrepair, and our mass transit is a mess. We need to fix our existing transportation and public transit with this funding, not build new highways that will cause environmental damage,” wrote Tittel.

Kevin McArdle has covered the State House for New Jersey 101.5 news since 2002. Contact him at kevin.mcardle@townsquaremedia.com. Follow him on twitter at @kevinmcardle1.