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New Jersey lawmakers, others say hit brakes on fuel tax hike

June 18, 2016

TRENTON, N.J. (AP) — Not so fast.

That’s the message some New Jersey lawmakers, residents and both conservation and liberal interest groups have for legislators who plan to move forward with a 23-cent wholesale fuel tax hike to pay for road and bridge work.

A long-expected proposal to shore up the state’s $1.6 billion transportation trust fund, which runs out of borrowing capacity July 1, is moving forward in the Democrat-led Legislature with bipartisan support. The fund runs out of borrowing power July 1.

But not all lawmakers are on board and Republican Gov. Chris Christie had a frosty reaction to the plan.

The proposal calls for increasing the size of the fund to $2 billion per year over 10 years, and also includes cutting taxes on retirement income and phasing out New Jersey’s estate tax.

It comes as a welcome development to some labor, construction management and business groups worried that state roads and bridges could go underfunded, and unrepaired. Christie’s former Transportation Commissioner Jamie Fox praised the proposal at a recent news conference.

Proponents say it represents a solid compromise that no one loves but everyone can live with.

“This is an investment in jobs and economic growth,” said Senate President Steve Sweeney, a Democrat. “We can’t afford to not address this need.”

But opposition is mounting on both sides of the aisle and for different reasons.

Among the most outspoken critics has been Republican state Sen. Jennifer Beck. She unveiled a plan in December that doesn’t include on a tax hike to bolster the transportation fund but, instead, relies on annual revenue growth, cuts to public employee benefits and increased fines for traffic violations.

Erica Jedynak, state director of Americans For Prosperity, a conservative interest group that opposes the tax hike, said the group will make sure voters know which lawmakers supported the increase. The group says a gas tax hike would drive up the cost of goods and services.

Meanwhile, some Democrats and liberal interest groups question whether the state can afford to cut the estate tax, which is estimated to bring in more than $400 million. They argue a gas tax is regressive, and estimate it would affect about 7 million licensed drivers in New Jersey, while the estate tax cut could help about 4,000 families.

“This is a tax on Chevy drivers and giving a tax break to Rolls Royce drivers,” New Jersey Sierra Club director Jeff Tittel said.

The proposal also has come under attack from a 101.5 FM drive-time radio host, who has been encouraging residents to call lawmakers to sound off against it. One caller said lawmakers don’t understand that people can’t afford to pay more for gas.

Christie says he wants the phase-out of the estate tax to happen while he’s still governor, not the four years cited in the lawmakers’ proposal. He also has said any deal must meet a tax “fairness” test, but he hasn’t said specifically what that is.

If lawmakers send Christie their package, he could sign, veto or conditionally veto it. They could then attempt to override Christie, but they have never achieved that during his two terms.

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