With a new survey claiming that many New Jerseyans would be willing to pay more at the pump to fix the state’s roads and bridges, Gov. Chris Christie didn’t explicitly say whether he’d back a gas tax increase in his annual budget address Tuesday (Feb. 16). Instead, Christie left the issue unresolved for now, saying a gas tax hike shouldn’t happen in a vacuum. He said “it’s time to reach a reasonable agreement” on the failing Transportation Trust Fund — arguing there’s time to do so. Officials have said the fund is set to run out of money this summer, but Christie called that a “politically driven mischaracterization” of the fund’s expected expiration after five years. In the meantime, Christie said, the state is able to fund the capital projects that were proposed when the TTF was authorized five years ago. Christie said there’s “plenty of time to reach a reasonable decision, but it would have to be the right one. It will need to be the right one for the hardworking taxpayers of New Jersey.” The New Jersey Sierra Club and New Jersey Policy Perspective expressed their disappointment in the lack of Christie’s concern regarding the Fund. In s statement, the New Jersey Sierra Club stated, “The governor has said he won’t fix TTF and that’s unconscionable. Trains are derailing and wheels are falling off busses. Without funding our transit system will be in ruin.” The governor said he has already called for a repeal of the estate tax- not directly addressing speculation he might consider such repeal as a trade for increasing the gas tax. The governor also pushed back against proposed constitutional amendment to raise New Jersey’s minimum wage and to force pension payments.
Though the state’s Transportation Trust Fund will run dry in 135 days, the state’s 2017 budget doesn’t include any plan to replenish it. In his annual budget address before the Legislature, Gov. Chris Christie called for a “reasonable agreement” on a way to renew transportation funding, echoing previous demands that any plans for a gas tax increase come with “tax fairness.” The $1.2 billion Transportation Trust Fund, also known as TTF, is set to run out of money on July 1, when it will require new funding in order to pay for a litany of capital transportation projects, including road repairs, mass transit projects, bridge replacements and a variety of soft costs. “To imply that the TTF is in crisis and is suddenly and unexpectedly running out of money is a politically driven mischaracterization,” Christie said. “Remedies for any fix of the TTF cannot be made in a vacuum. The reality is that New Jersey is fully able to support the current capital program as originally proposed in the current five-year authorization.” Christie stated that there is time to reach a reasonable agreement, but it will need to be the right one for the hardworking taxpayers of New Jersey. That time is now, said Assemblyman John Wisniewski. Without new funding in 2017, money won’t be available for new projects, as all payments would go toward paying off bonds issued to renew the fund.
Folliwng Christie’s highly anticipated return to the State House for his budget address after final curtain fell for his presidential bid last week, Senate Democratic leadership offered faint praise for the budget’s successful public pension payment but called the address failure on the state’s ailing Transportation Trust Fund. Christie’s speech took aim at public workers’ benefits, which he described from the podium as “platinum level” and a burden on the state budget. Senate President Steve Sweeney is pushing a ballot question to introduce mandatory quarterly pension payments and avoid another round of missed payments like the $2.4 billion Christie neglected to pay into the pension fund in May of 2014. Christie claimed during the address that Democrats want to fund the Trust Fund “on the back of taxpayers by imposing a hike on gas prices without any discussion of tax fairness.” Christie’s mention of the transportation issue may lead to a compromise where an increase in the gas tax would be accompanied by cuts to the inheritance tax. “We need to have a conversation with him,” said Sweeney. “Not one where the Democrats throw something out on the table for the governor to reject.”
As Trenton’s payroll troubles continue to mount, the Mercer County Prosecutor’s Office announced Thursday (Feb. 11) it was launching a criminal investigation. The city had reached out to county officials over concerns about its payroll company, Innovative Payroll Services, after taxes were withheld from city employees’ paychecks, but never paid to the government. The prosecutor’s office made the decision to begin an investigation after speaking more with city officials this week, spokeswoman Casey DeBlasio said. The state Department of Treasury last week deferred comment to the city, which has kept mum on the specifics. IPS was founded in 2006 and has locations in West Berlin, N.J., and Largo, Fla. Trenton first contracted with the company in May 2009 and, most recently, approved six-month extensions in June and December of last year. State business records show that IPS’ business license was revoked in April 2015 for failing to file its annual report for two consecutive years. An annual report was filed with the state in September 2012. John Scholtz, the CEO of IPS, has since retained Lisa Mathewson, a white-collar criminal defense attorney. The Internal Revenue Service reminds employers that even if they outsource some or all of their payroll and related tax duties to third-party payroll service providers, they are still ultimately responsible for the deposit and payments of federal tax liabilities. Patricia Svarnas, an IRS spokeswoman for the New Jersey and New York region, said that strict privacy laws prevent the agency from disclosing unauthorized information about the city’s relationship with the IRS.
Christie’s address to a joint session of the Legislature is scheduled to begin around 2 p.m. in the Assembly chamber of the Statehouse. It marks Christie’s first public appearance since ending his presidential campaign, a quest that has to at least some degree colored the way people viewed every major speech he has given for the last five years. Last June, Christie enacted a $33.8 billion state budget for 2016, and revenues midway through the budget year are running slightly ahead of expectations. Senate President Stephen Sweeney said he has spoken by phone with Christie but doesn’t know what will be proposed in the speech. Sweeney said he hopes the budget includes an additional $550 million in funding for pensions, changes the school aid formula and addresses the Transportation Fund. He said he expects Christie to talk about phasing out estate tax. “There’s a lot of things that we need to get done now,” Sweeney said. “The governor’s got 23 months left in his term. You know what? He could do a lot of good in 23 months, if he wants to.”