New Jersey legislative leaders are pitching a new proposal to revive the expired Transportation Trust Fund for statewide road and rail projects.
Senate President Stephen Sweeney, D-Gloucester, and Assembly Speaker Vincent Prieto, D-Secaucus, announced a bipartisan agreement Friday that would replenish the TTF through a gas tax hike while also creating additional tax cuts.
The joint proposal does not include a cut in the sales tax from 7% to 6% that Gov. Chris Christie and Prieto agreed to last month, to which Sweeney objected. The new plan would fund a new 10-year $20 billion TTF at $2 billion annually with the gas tax revenue covering debt service payments.
"New Jersey needs a viable Transportation Trust Fund or we risk economic disaster," said Prieto. "With efforts to negotiate a compromise with the governor stalled, I'm pleased to reach this new compromise that will provide much-needed investment in our state's infrastructure and tax relief."
Christie halted $3.5 billion of road and rail projects funded by the TTF in early July after lawmakers failed to reach agreement on a new funding plan before a July 1 deadline. The fund, which was last authorized in 2012 at $1.6 billion annually, has enough cash to pay for transportation projects through early August, according to lawmakers.
The new proposal retains elements of an original proposal crafted by Sweeney that would phase out the state's estate tax by 2020, increase earned income tax credits for the working poor by 40% and raise tax exemptions for pension and retirement income. The new bill does not include tax deductions on charitable giving in the initial bill, but does provide deductions up to $500 for in-state gas spending and creates a $3,000 personal exemption for veterans. The legislation will need support from Christie or enough votes to override a veto.
Christie's support is far from certain.
"The Senate President and the Assembly Speaker must be more interested in publicly pretending that they have accomplished something on TTF before they go off to the Democratic convention rather than actually accomplishing something," Christie's press secretary, Brian Murray said in a statement. "They have not shared the specific details of their joint proposal with the Governor beyond the vague generalities contained in their press release. The Governor will review those specifics if he receives them from Senator Sweeney and Speaker Prieto. Only then can he determine if their plan to fund the TTF with an increased gas tax offers tax fairness to the people of New Jersey in the form of significant broad-based tax relief."
