New Jersey needs to find a new way to fund its transportation infrastructure.
That recommendation is one of many in a wide-ranging report, “Facing Our Future,’’ which says the state has to spend $70 billion to fix its aging infrastructure, including $21.3 billion to upgrade its roads, highways, bridges, and mass transit system.
The numbers are staggering. What’s more, they’re probably understated. That’s understandable: the state has not done a comprehensive transportation plan in more than 10 years.
Many of the new report’s recommendations echo calls for power and water infrastructure improvements in the wake of Hurricane Sandy, but its suggestions in the transportation sector probably are the most dramatic. The report was developed by a bipartisan and independent group of senior officials, many of whom served in past Republican and Democratic administrations.
The report paints a bleak future for economic growth in New Jersey, unless state leaders and, more importantly, the public step up to the plate and begin to clamor for money to fund infrastructure improvements.
“We need expanded public understanding of the importance of infrastructure and its importance when it fails,’’ the report said, referring to Sandy, a topic mentioned repeatedly.
“As horrible as Sandy was, it’s the opportunity to focus on the key issues,’’ said Sam Crane, a former state treasurer under the administration of Gov. Jim Florio.
According to the report, New Jersey needs to invest at least $40 billion in its antiquated water facilities, both drinking-water plants and wastewater treatment facilities. It should spend at least $250 million annually in open-space preservation, at a time when funding for that effort is drying up. It calls for increases in water fees to help fund the effort, not mentioning that new surcharges were already imposed on utility customers by the New Jersey Board of Public Utilities last year to speed up modernization of century-old water systems.
How important is preserving watershed land? The New Jersey Highlands provide drinking water to millions of residents. As a comparison, New York spent $1 billion to protect watershed lands in the Catskills, another major source of drinking water. It helped New York City avoid a fivefold increase in water treatment costs for its residents, according to the report.
Another nearly $8.7 billion needs to be invested in upgrading the power distribution system to make it more reliable in extreme weather. That estimate does not include contracts with power suppliers and projections by various state agencies that consumers and businesses will pay out as much as $7 billion in subsidies on their electric and gas bills over the next decade or more to spur new solar energy, offshore wind, and new natural gas power plants.
Transportation in Trouble
In the transportation sector, however, the recommendations are the most profound. And they are likely to face the toughest scrutiny, if taken up by officials and considered seriously by the public — two outcomes that may be unlikely.
The report calls for an increase in the motor fuels tax — at least in the short term, — a recommendation likely to fall on deaf ears in Trenton, given the current political climate. Gov. Chris Christie has repeatedly vowed not to raise any taxes. New Jersey has the third-lowest motor fuels tax in the nation, one that has not been raised in more than two decades.
The report also recommends that in the long term, the motor fuels tax be eliminated: the number of gallons sold is declining due to federal fuel-efficiency standards
Instead, the state should consider funding transportation projects based on vehicle-miles traveled, or imposing a sales tax on gasoline — strategies adopted in other states, according to the report.
The report also notes that the approximately $1.5 billion New Jersey gets annually for transportation projects from the federal government — given its own fiscal problems — is expected to drop in the future.
“The gap between what is needed to invest in New Jersey’s transportation infrastructure and the amount we have been spending is a minimum of $1 billion to $2 billion a year,’’ according to the report.
At a time when the Christie administration is pushing hard for local governments to consolidate their services, the report suggests New Jersey ought to merge its multiple transit and transportation agencies, seven in all, into a new ‘’utility-like structure.’’
The seven agencies include the New Jersey Department of Transportation, New Jersey Transit, the Port Authority of New York and New Jersey, the South Jersey Transportation Authority, the New Jersey Turnpike Authority, the New Jersey Motor Vehicles Commission and the New Jersey Transportation Trust Authority.
Those transportation agencies should be consolidated into a “Pubic Benefits Corporation, regulated by an independent board, rather than elected officials.’’ Presumably that would prevent lawmakers and governors from raiding the state’s transportation fund to help balance the state budget, diverting $250 million from the fund in this year’s proposed budget, if approved.
“This new organizational approach can lead to cost-effective policy and efficient provision of transportation services and to the funding necessary to maintain and expand transportation services,’’ the report said.
“We have to think about it differently,’’ Crane commented.
It is a discussion that needs to be taken more seriously after Sandy, according to the report.
“Before Sandy, we had budget problems and a deteriorating infrastructure,’’ said the report. “After Sandy, inconceivable new challenges compounded these existing problems,’’ it added.