After months of negotiations and multiples attempts to pass different versions of the plan, legislation to reauthorize the Transportation Trust Fund (TTF) was passed by the Senate and Assembly on October 7 and subsequently signed on October 14 by Governor Christie.
The key component of the package is a $0.23 cent increase in the automobile gas tax. The tax on jet fuel and 100LL has not changed and isn’t affected by this legislation. Even with this increase, New Jersey’s auto gas tax will still be less than our neighboring states of New York, Pennsylvania and Connecticut. It is set to take effect by November 1. The legislation passed the Senate by a 24-14 vote, with the Assembly approving it by a 45-27 margin.
The bipartisan plan will provide dedicated funding of $2 billion a year for eight years, the most significant investment in the TTF since it was created. With matching federal funds, the state’s $16 billion investment will increase to almost $29 billion. It will effectively double state aid to counties and municipalities to $400 million for highway and bridge repairs and includes a Transportation Infrastructure Bank to lower borrowing costs for local government.
In order to achieve a successful bipartisan vote in the legislature and to get Governor Christie on board, the package contains several tax relief measures and broad-based tax cuts including an increase from 30 to 35 percent in the Earned Income Tax Credit for the working poor, tax deductions up to $100,000 on retirement income, a veterans’ exemption of $3,000, a phase-out of the estate tax by 2018 and a cut in the State sales tax over two years from the current 7% to 6.625%.
The legislation also creates a new four-member “Annual Transportation Capital Program Approval Committee,” comprised of the Commissioner of the NJ Department of Transportation and three public members appointed in consultation with the Governor, Senate President and Assembly Speaker. The bill stipulates that the public members must represent each region of the state (one from northern, one from central and one from southern New Jersey). The committee is given unique power to “certify” (read approve) any new TTF projects in each new fiscal year. In fact, the Legislature is prohibited from providing funding to any new project, unless every member of the committee votes to certify it.
The months’ long stalemate has impacted aviation projects, like the runway keel repair project at MMU. Even though the airport project is funded by aviation fuel tax, and not the auto gas tax, it was part of the TTF impasse because the aviation tax goes to the Transportation Trust Fund.
With the legislation signed and the auto gas tax increase taking effect by November 1st, important public infrastructure projects will commence once again, providing jobs and spurring the state and regional economies. MMU will continue to work in partnership with NJ Department of Transportation who is providing important grant monies to the keel repair project along with the Federal Aviation Administration for the larger runway rehabilitation project, to begin moving these projects forward.
We will be reaching out to our tenants in the coming months to determine the most opportune time to reschedule the remaining keel repair work.
For more information on the Transportation Trust Fund, please visit: