New Jersey voters will soon get an opportunity to decide whether to ensure all revenue from the state’s fuel taxes permanently goes toward improving transportation infrastructure.
The state Assembly and Senate voted on Monday, Jan. 11, to approve a resolution that is intended to head off the state’s Transportation Trust Fund from running out of money for repairing and maintaining roads and bridges on July 1. The fund relies largely on revenue derived from the state’s gasoline and diesel taxes.
Assembly Speaker Vincent Prieto, D-Hudson/Bergen, said the proposed constitutional amendment ensures all revenue from the fuel taxes goes to the Transportation Trust Fund.
“Unfortunately no agreement has been reached, but it’s important that voters be given the chance to dedicate all money raised by these taxes to transportation needs,” Prieto said in prepared remarks following the proposed constitutional amendment’s passage.
“Taxpayers must be confident every cent raised by these taxes goes to the right purpose – rebuilding and maintaining our roads and bridges.”
ACR1 does not raise the current fuel tax rates.
The gas tax includes a 10.5-cent motor fuels tax and a 4-cent petroleum products gross receipts tax. The diesel rate is set at 17.5 cents per gallon.
In Fiscal Year 2016 the fuel taxes are estimated to raise $541 million. The tax on the gross receipts of the petroleum products is expected to raise $215 million.
The full amount of the gas tax is already dedicated to the trust fund. However, 3 cents of the diesel tax is not dedicated to the fund.
If the tax rates are raised in the future, the amendment dedicates the increased revenues that would result from the tax increase to the trust fund.
The proposal would also dedicate all the revenue from the petroleum products gross receipts tax to the trust fund.
Prieto said the ballot question is a commonsense first step to ensure the state’s economic well-being.
“New Jersey needs a modern and safe transportation network for its economic survival, but years of foolish borrowing leave our state teetering on the brink of an economic disaster.”
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