The New Jersey Business & Industry Association today urged voters to approve Public Question No. 2 on the ballot Tuesday, November 8—the proposed constitutional amendment ensuring all motor fuels tax and petroleum products gross receipts tax revenues that are collected go toward infrastructure projects. If the funds are not constitutionally dedicated to this purpose the funds will go into the state budget and can be spent on anything.
“It is important to understand that the new law increasing the gas tax by 23 cents a gallon has already gone into effect and that the state can borrow money to fund transportation projects even if this referendum fails,” said Michele Siekerka, NJBIA President and CEO.
“The notion that defeating this referendum will send a message about the gas tax increase, roll back the gas tax increase or prevent the state from moving forward on transportation projects is not true. The gas tax will not be rolled back and the state will still be able to bond for infrastructure projects with or without this ballot question.
“Further, there is no requirement that the state go to the public for approval to sell bonds to fund infrastructure projects because they are not General Obligation Bonds, but rather bonds backed by the gas tax revenues in the TTF. Approving Public Question No. 2 will ensure those funds are dedicated to TTF.
“Voters must approve the ballot question to ensure the funds that are collected are used for their intended purpose. If we don’t lock up the gas tax revenues, we are defeating the whole purpose of raising the gas tax to improve our infrastructure,” Siekerka said.
The new law also caps infrastructure borrowing at $12 billion. If the amendment fails, there would be no cap.
“There are also those who are concerned that we are continuing to borrow money for transportation projects and our bond indebtedness will grow,” Siekerka said. “The fact is the only way to afford capital projects is through bonding, which leverages existing dollars. We must constitutionally mandate gas tax revenues be used for these purposes. The revenues generated by the gas tax increase ensure that we will have a continuing pool of money dedicated to this purpose for many years to come.
“No one likes that we had to increase the gas tax, but this tax was inevitable. Decades of neglecting infrastructure investment have led us to this moment. New Jersey is already rated at the bottom in the quality of our roads and bridges,” Siekerka said.
For a copy of Public Question No. 2, please click here.