U.S. D.O.T. Secretary Agrees Taxes Are an Unsound Foundation for Income
Senator Andrew Ciesla, the senior Republican member of the Senate Transportation Committee, issued the following statement regarding funding sources for the Transportation Trust Fund (TTF). The TTF will become insolvent in Fiscal Year 2011, less than two years from today.
“As one component of the Republican Common Sense Plan for an Affordable New Jersey, we proposed a plan that would commit $500 million a year, in current revenue towards the TTF. Now I believe the governor and the legislative leadership should reconsider our proposal to commit these funds to keep our roads safe, without a gas tax hike or toll increase.
“A sustainable funding source for the TTF is the only way that we can guarantee federal matching funds for critical infrastructure maintenance and improvements across the state. Motor vehicle funds are a far more reliable source of revenue than either gas taxes or tolls.
“Increases in the gas tax or higher tolls are not the answer to re-financing the TTF. The rapid increase in gas prices this summer has driven down toll revenues on the New Jersey Turnpike, Garden State Parkway as well as the Port Authority of New York and New Jersey bridges. Higher gas prices have also contributed to a decline in overall motor fuels tax revenue nationwide. I have been advised that the drop in toll revenue has caused Turnpike bondholders to demand a toll hike.
“Even the Unites States Secretary of Transportation has acknowledged the gas tax is an unsustainable source of revenue for transportation projects. ‘We can’t afford to continue pinning our transportation network’s future to the gas tax, ‘ said Mary Peters, U.S. Secretary of Transportation, in a statement to CNNMoney.com. ‘Advances in higher fuel-efficiency vehicles and alternative fuels are making the gas tax an even less sustainable support for funding roads, bridges and transit systems.’
“Therefore, the only logical answer to refunding the TTF is to dedicate revenue from motor vehicle fees to the fund. The Motor Vehicle Commission generates hundreds of millions of dollars above their operating expenses. In short, they make millions of dollars in profit.
“This profit is used to support a number of state projects not related to transportation. These monies must be committed to support transportation infrastructure projects. This is a stable source of revenue that will ensure a safe, modern transportation network and federal matching funds for years to come.”
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September 5, 2008
