Democratic lawmakers have listened to Gov. Chris Christie say for weeks that it’s on them to come up with a plan to renew the state’s Transportation Trust Fund before it goes broke this summer. Now they’re firing back, saying it’s the governor himself who is hiding from that responsibility.
The war of words comes as the state currently has no clear plan in place to extend capital funding for road, bridge, and rail-network projects beyond June 30. Meanwhile, Christie has been locked in a stalemate with Democratic legislative leaders over whether to hike New Jersey’s gas tax, which is the trust fund’s main source of revenue.
Whether the outlook for an eventual deal between the governor and lawmakers will be soured by the latest clash remains to be seen. It’s a critical concern since funding for new projects and even some of those already underway is at stake.
Christie has repeatedly said that if Democrats want to increase the gas tax, the state constitution gives them the sole authority to pursue such a remedy. And his proposed budget for the fiscal year that begins July 1 includes only a $1.6 billion placeholder for state transportation spending, with no specific explanation of how his administration would come up with the cash.
In New Jersey, the governor presents a budget framework each year and sets official revenue forecasts, but lawmakers have the authority to draft the formal appropriations bill. The governor also has line-item veto power, but he can only remove items once the budget bill reaches his desk.
With budget hearings on Christie’s proposed spending plan now well underway, lawmakers have begun to challenge officials from his administration to explain exactly why Christie has yet to weigh in with his own transportation-funding plan even while outlining in detail $34.8 billion in spending.
During a lengthy Assembly Budget Committee hearing on state transportation spending that was held yesterday in Trenton, Assemblyman Troy Singleton (D-Burlington) said it’s traditionally been the role of the governor going back decades to the creation of the trust fund to craft each reauthorization plan. This year, however, with the 14.5-cent gas tax now only producing enough revenue to pay down the fund’s significant debt, Christie is attempting to shift the burden onto lawmakers, Singelton said.
“Has the Legislature ever submitted a plan to the executive branch for the TTF reauthorization, or has it gone the other way?,” Singleton asked acting state Department of Transportation Commissioner Richard Hammer during the hearing.
“I honestly haven’t kept track of that,” responded Hammer, who has over 30 years of experience.
Singleton, in response, walked through several prior reauthorization plans, including the last five-year plan that was personally put forward by Christie back in 2011.
“It seems, from a historical precedence, the direction of the plan usually comes from the executive branch, with the Legislature responding,” Singleton said.
“I appreciate the governor reversing course from a matter of historical precedent by not submitting a plan, which he has done and all of his predecessors have done,” Singleton went on to say.
[related]Still, many believe the governor and lawmakers will ultimately reach a bipartisan deal that will include some new tax cut that Christie and other Republicans prefer as well as the gas-tax increase that Democrats have said is necessary. Under that scenario, lawmakers would also have to approve any increase in borrowing for the trust fund, which reached its debt ceiling late last year.
But last month, the results of the latest survey conducted by the Rutgers-Eagleton Center for Public Interest Polling showed 56 percent of the state’s residents oppose a gas-tax increase, while only 42 percent said they support a hike. Those results were largely unchanged from this time last year, though the same poll found nearly 72 percent of the state’s residents opposed a gas-tax increase five years ago.
Christie himself mentioned the Transportation Trust Fund issue during an event held earlier in the week in Jersey City to announce a $200 million tax cut for state businesses that’s being brought on by the improved condition of the state’s unemployment insurance trust fund.
He said that while lawmakers want to talk primarily about the gas tax, he also wants the conversation to include overall “tax fairness” for New Jersey residents. He went on to criticize the aggressive nature of New Jersey’s estate tax and the state’s lack of an income-tax exemption for charitable contributions, suggesting those are items that lawmakers should also be concerned about.
During the hearing yesterday, lawmakers asked Hammer to explain what would happen if they get to June 30 with no deal at all reached with the governor. He said the state probably will have enough cash to reach early August at the latest. And he conceded if the fund does go dry it will impact not just new projects, but those already underway where billing has not yet been brought up to date.
But Hammer also said yesterday that as long as the state still has cash to pay for projects it’s not a crisis, and he is optimistic that Christie and lawmakers will ultimately be able to strike a deal to renew the fund before it runs out of money. That follows comments Christie made during his budget address in February, when he said those characterizing the situation as a crisis are driven by partisan politics.
“I am remaining, deep down, I am remaining confident that there will be a resolution to this,” Hammer said yesterday.
That drew a response from Committee Chair Gary Schaer (D-Passaic), who at one point challenged him to say exactly when the state would hit the point of crisis.
“What we seem to have going on here is a discussion of who goes first. I almost feel as if we are children on a playground,” he said. “It seems to me there should be some outrage.”
“It seems to me this is an extraordinary event and it’s not being approached with that amount of gravity” Schaer added. “I just don’t get why I’m so concerned and all the professionals seem to be fine.”
Assemblyman John Burzichelli (D-Gloucester) also joined the discussion, asking acting New Jersey Transit executive director Dennis Martin to characterize the impact of the diversion of roughly $400 million in capital funds that are being used to subsidize the agency’s operating budget.
New Jersey Transit’s subsidy from the state budget, though expected to be larger during the next fiscal year, is still much less than the agency has received in prior years. And despite hiking fares last year, Martin said New Jersey Transit will still have to close an estimated $45 million budget gap to keep its own spending in balance, though he said another fare hike is not planned.
“In a perfect world we would like to have that money available for capital investment, but we have to operate within the constraints of the budget that’s handed to us,” Martin said.
Later, Burzichelli added up the state’s overall transportation-funding challenges, including the lack of a firm renewal plan for the trust fund and New Jersey Transit’s lingering budget crunch.
“We’re in a bad spot,” Burzichelli said. “These numbers are upside down.”