Clean Energy Fund Raided (Again) to Plug Last Hole in State Budget
Administration, lawmakers tap $75 million from fund, up $25 million from amount announced previously — in addition to $161 million already diverted this year
With only a few days left in the fiscal year, the Christie administration and lawmakers turned to an old and trusted standby to help plug the last remaining gap in the current state budget.
Without debate, both the Assembly and Senate budget committees yesterday approved a bill (A-5000) tapping another $75 million — up $25 million from the amount announced last month — from the state Clean Energy Fund for a supplemental appropriation.
The legislation, introduced on June 15, aims to balance the state budget by diverting money from a variety of funds, although just how much is unclear because the measure only listed specific amounts for the Clean Energy Fund, which is supposed to finance renewable energy and energy conservation programs.
In addition, the legislation would tap unspecified dollars from the state recycling fund and the Unclaimed Utility Deposits Trust Fund. According to sources, the amount totaled about $10 million. The state fiscal year ends June 30.
The bill said the additional $75 million would be added on to past diversions allocated to NJ Transit and the budget to cover utility costs. The bill passed quietly on a day when legislative leadership were holed up in negotiations over next year’s fiscal budget, which begins on Saturday.
In May, the Christie administration announced a $527 million shortfall in revenue that needed to be closed before the end of the fiscal year. The bulk of the deficit was to be closed by pushing off payments of about $300 million to municipalities to cover Homestead property-tax credits until the new fiscal year.
At the time, state Treasurer Ford Scudder said the state would divert an additional $50 million from the Clean Energy Fund to plug the gap, a common tactic used by legislators and the administration. This fiscal year the fund already has had roughly $161 million diverted to other uses.
With the latest $75 million diversion added to the $161 million that already has been tapped, approximately 60 percent of the state’s Clean Energy Fund has been raided, according to Jeff Tittel, director of the New Jersey Sierra Club. “Anything that is not nailed down, they are going to take,’’ he said.
More than $1.5 billion has been diverted from the Clean Energy Fund during Christie’s tenure with legislative support. The fund is financed by a surcharge on gas and electric customers’ monthly bills.
Clean-energy advocates have repeatedly criticized the tactic, saying it hurts New Jersey’s efforts to switch to cleaner fuels to produce electricity and hampers efforts to be less dependent on fossil fuels.
At one point this spring, the Democratic-led Legislature appeared poised to put a constitutional amendment in place that would prevent the diversion of the funds, but that effort stalled, making it unlikely to appear on the ballot this fall.
“It’s rubbing salt in the wounds of ratepayers,’’ said Doug O’Malley, director of Environment New Jersey, referring to the latest raid of the fund. “It fits the pattern of using the clean energy money as a slush fund.’’