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NJ Sierra Club: Irresponsible TTF Bill Released from Committee


The Senate Budget and Appropriations has released a set of bills that will provide a 6a00d8341bf7d953ef01b7c731d077970bseries of tax cuts for the wealthy as part of the Transportation Trust Fund deal. They will be merging S2412 (Sarlo)/ A10 (Prieto), S2411 (Sarlo) /A11 (Prieto), and A12 (Prieto). These revisions include a 12.5 percent increase in the Petroleum Products Gross Receipts Tax, a four-cent diesel surcharge and a seven percent tax on non-motor-fuel petroleum products to fund the TTF, which would run out of money on August 10th. Instead of moving forward with the Assembly’s plane to eliminate the sales tax, they will move forward with the Senate’s plan to give a $20 million tax break to motorists and veterans. 

We believe in a plan to fix the TTF with a gas tax, but this would be on the backs of the middle tax by tying it to two other bills that would cause a fiscal crisis in New Jersey.


“The State Legislature is completely irresponsible in pushing legislation that they know will bankrupt the state down the road. While our state is broke and doesn’t have money to fix lead in schools, these bills are a complete sellout to working families and will give a huge tax break to the wealthy. The only difference is now they want to justify a $900 million tax cut, by giving a few pennies to veterans and motorists. This plan will raise the gas tax, but cut $900 million of revenue by eliminating estate and inheritance tax on the wealthiest people in New Jersey. This will cause major budget holes and cuts to programs and services for working families, while the rich get a tax break. It will mean more raids to environmental settlements, stealing from the Clean Energy Fund, no money to clean up toxic sites, fix lead pipes or remove lead from schools. What programs is the legislature going to cut?” said Jeff Tittel, Director of the New Jersey Sierra Club. “This is the New Deal, Same as the Old Deal: Bad for New Jersey. One version of these bills may be worse than the others but they are both bad. They should have a clean TTF bill with just the gas tax and nothing else attached- otherwise we are driving off the fiscal cliff.”


The Sierra Club opposes the plan to fix the Transportation Trust Fund over the next 10-years on the backs of the middle-class. The fund is desperately needed to fund transportation improvements and public transit. However, at the same time S2411 (Sarlo) /A11 (Prieto) will eliminate of the state’s estate tax, which will cause future budget deficits and robbing of important environmental programs. The phase out the estate tax over 3 1/2 years, replacing the current $675,000 threshold with a $2 million exclusion after January 1, 2017, going to the federal $5.4 million level from January 1, 2018, to December 31, 2019, and eliminating the estate tax altogether as of January 1, 2020.


“This plan gives tax cuts to the wealthy and makes it harder for the middle class to get by. With this plan, the TTF should stand for ‘Trump Trust Fund.’ They want to hike taxes on the middle class while giving tax breaks to the wealthy who don’t need it. This compromise gives tax cuts to billionaires while making the average middle-class person go bankrupt with higher taxes,” said Jeff Tittel. “They say this bill is a good deal, but these bills are only good for Rumson and Short Hills, while hurting the rest of us. The tax breaks for the wealthy could be even worse because it is open ended and we don’t know yet how much the tax break for charitable donations will wind up being. Donald Trump and the billionaires get a tax cut and the rest of us get nothing.”


Raising the gas tax will help raise money for the TTF, especially since transit users have suffered fare hikes and services cuts nine times since the last time the gas tax was raised. The plan put forth by the Senate, however, will do more damage because it will take away funding from programs that impact working families across the state.


“We need monies from the estate tax to fight lead in our schools or fix the $8 billion of leaky pipes. We don’t have money to fix combined sewer overflows, keep our air and water clean, or pay for pensions. The legislature should identify all of the programs that will be cut before they vote on these bills,” said Tittel. “This legislation is irresponsible, fiscally unsound, and may be vetoed by the Governor anyway.”


There is a desperate need to fund transportation in New Jersey and the best way to do it is a gas tax, but we can’t tie that to a tax break for the wealthy or by eliminating the sales tax. If we do this it will make it a regressive tax. We need to build public transport for the good of the public as well as the environment and instituting a gas tax will help to do that. However, this plan is fiscally dangerous and may lead to more pollution, sprawl, and transportation deficits.

“We support a gas tax because our roads are crumbling, our transit system is a mess, and 1/3 of our roads are considered dilapidated, but it cannot be tied to tax cuts that will hurt the middle class. $2 billion isn’t even enough to meet our transportation needs and there is still no money for operations in this plan. We are concerned this is not even enough money in this plan to do what’s needed for the TTF, but in five years it will be a billion-dollar per year tax cut for the wealthy,” said Jeff Tittel, Director of the New Jersey Sierra Club. “Instead of fixing the problem, this legislation would just leave a bigger mess for the next Governor to deal with.”