Lawmaker: Let’s just borrow all the roadwork funds for two years
Assemblyman John Wisniewski has been saying it for months, and now it’s formally proposed as legislation: Maybe the best plan for the now-broke Transportation Trust Fund is to borrow the $3.2 billion that would be needed to keep road work going for the next two years.
“This is the best of all of the bad options we have,” said Wisniewski, D-Middlesex. “It would give us an opportunity to restart the construction projects that have been shut down. Put back to work all of those men and women who make their livelihood in the construction industry.
“And more importantly,” he said, “tee this up at a time when a more rational occupant of the Governor’s Office can look at it critically and make an informed decision, as opposed to relying on the requirements of Grover Norquist to make a decision for the state of New Jersey.”
It seems a longshot for the idea to get much traction, though it does have three co-sponsors. Gov. Chris Christie hopes to leverage the gas-tax hike being sought to fund transportation projects into a big reduction in the sales tax. And most Transportation Trust Fund advocates have panned the idea.
“We’ve heard that song before. That’s exactly how the TTF has evolved into the deplorable situation it’s in right now,” said Tom Bracken, chairman of the Forward New Jersey coalition and president and chief executive officer of the New Jersey Chamber of Commerce.
“To continue to put off a solution when there are some viable solutions being discussed with the governor and the speaker and the Senate president, to put a new solution on the table which is borrowing and potentially derail those discussions is just not a good thing to do,” he said.
Wisniewski doesn’t favor the options being discussed behind closed doors, which include a mix of reductions in the sales and estate taxes, and possibly income taxes for retirees.
Christie wants the value of the tax cuts to exceed the cost to drivers of a proposed 23-cent a gallon increase in the gas tax, which would be around $1.2 billion.
“If we have one proposal to give back one cent on the sales tax in order to fund the Transportation Trust Fund, that’s over $1.7 billion in revenue. We don’t have to do that,” Wisniewski said. “If we have that kind of money to give back, why don’t we just use $200 million of that, create a bridge program, and when we have a more rational occupant of the Governor’s Office, we can move forward on this.”
Wisniewski’s legislation would borrow $1.6 billion a year for two years. He said the cost for repaying that amount of borrowing would be around $200 million, which he said would come from the sales tax revenue the state has already been putting toward the TTF in recent years.
“It is not the best choice,” he said. “The best choice is to raise the gas tax 25 cents a gallon, dedicate all of that, manage it prudently, and we would literally not have to come back and discuss this issue again.”
Bracken said the proposal should be a nonstarter, as is waiting for another governor. He said there’s no way of knowing whether finding a TTF solution would be easier under the next governor.
“I don’t know if that’s true or not true. That’s a big assumption. Who knows who will be in the office? Who knows what their attitude will be?” Bracken said. “To put it off, period, is a bad reason. To put it off for that reason is a doubly bad reason. And to fund it in the interim with debt is a third bad reason.”
“Assemblyman Wisniewski’s borrowing proposal isn’t a fix in any way; it’s just more of the same short-term thinking that’s put the Transportation Trust Fund further in the hole,” said Greg Lalevee, chairman of the of the Engineers Labor-Employer Cooperative.
Wisniewski said some TTF advocacy groups are more focused on the tax-cut side of the plan than financing road and rail projects.
“What I hear are groups that seem to be more invested in providing a sales tax cut, more invested in providing an estate tax cut than they are in fixing the trust fund,” Wisniewski said.
Bracken acknowledged that the tax cut side of the package is important.
“I’m worried about the future of New Jersey,” Bracken said. “The other items involved with this tax fairness component, all of those would help the state become more affordable and would help the state become more competitive. We have to become more affordable, we have to become more competitive if we are going to thrive as a state again.”
“What we’re talking about with regard to the items on the tax fairness side of the ledger, to me they’re not expenses. They’re investments. They’re investments in the future of New Jersey. I’m glad they’re on the table. I’m not a fan of having these two things linked, but I’m glad that both of them are being discussed – both the tax fairness items and the TTF,” he said.
“If they’re done together, so be it. I think we’ll all be winners because they’re done together.”