From our September/October 2010 Railgram newsletter
State Senator Joseph Cryan has introduced a bill in the Legislature to raise the gasoline user fee to fund the Transportation Trust Fund (TTF). At the end of the current fiscal year next June, all of the revenue in the TTF will be used for debt service, so none will be available for transportation improvements. The current formula is 75% for highway projects and 25% for capital projects on New Jersey Transit.
Cryan’s proposal would raise the user fee on gasoline (it is not a tax) by 8¢ per gallon each year for the next 3 years. After that, an indexing formula would determine the amount of the fee to be collected. New Jersey’s user fee on motor fuels is the third lowest in the country, having reached its present level in 1988, 22 years ago. Since then, there have been 8 fare increases on New Jersey Transit, including an increase of 25% in peak-hour and oneway rail fares and 47% or more in off-peak rail fares this past May.
The Lackawanna Coalition has expressed support for the concept of an increased user fee to be levied on motor fuels, but has expressed its deep concern that such revenue will be used as collateral for further borrowing, which is what brought trouble to the TTF in the first place. At one time, the fund operated on a “pay as you go” basis.
Some members of the transit advocacy community have questioned the need for continuation of the TTF at this time, claiming that more highway construction projects are unnecessary, and that small capital investments for transit can be funded in other ways. They claim that most of the money from the TTF would go toward building NJT’s proposed deep-cavern terminal, which the state cannot afford.