- Budget Committee Moves TTF Package to Senate Floor
- Gov. Christie and Senate President Sweeney Promote Their School Funding Plans
Budget Committee Moves TTF Package to Senate Floor
The Senate Budget Committee released a bill package last week to replenish the State’s Transportation Trust Fund (TTF) by raising the gas tax and enacting a series of other tax cuts. The new TTF plan has the support of both Senate President Steve Sweeney and Assembly Speaker Vincent Prieto.
It includes 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.
The plan increases the gas tax on motorists by 23 cents a gallon, generating $1.2 billion annually, which would support $2 billion in infrastructure investments each year
The tax relief portions include:
- Phasing out the estate tax over 3 ½ years;
- Providing an annual income tax deduction up to $500 in state gas taxes paid for all New Jersey motorists with incomes up to $100,000;
- Increasing the Earned Income Tax Credit;
- Increasing the New Jersey gross income tax exclusion on pension/retirement income over four years with incentives for seniors in the fifth year;
- Providing a $3,000 personal exemption on state income taxes for all New Jersey veterans honorably discharged from active service.
The new plan is opposed by Governor Christie, who believes it does not provide enough “tax fairness.” Without the governor’s support, the Senate and Assembly will need to garner enough votes in each house (27 in the Senate/54 in the Assembly) to override an expected veto. Senator Steve Oroho, a bill sponsor, was the only GOP legislator to support the plan in committee.
Gov. Christie and Senate President Sweeney Promote Their School Funding Plans
New Jersey currently distributes $9.1 billion in school aid under a formula created under a 2008 law. Despite it being the largest amount of school aid to date, it does not fully fund the formula. The funding disparity has caused financial issues for school districts of all types, especially those seeing growing numbers of students. Governor Christie and Senate President recently unveiled competing proposals to address the funding disparity and its impact on local property tax bills.
Under Governor Christie’s “Fairness Formula,” which seeks to amend the State Constitution and requires voter approval, each public school district would receive $6,599 per enrolled student. According to the Governor, 75 percent of all school districts would see more aid under his plan than they do today. Democratic legislators have called the proposal unconstitutional on the basis that it does not provide an equal education to children, noting that it’s especially harmful to urban school districts, many of whom would see a drastic drop in school aid.
Under Senator Sweeney’s “Formula4Success” a four-member "State School Funding Fairness Commission" is created and given one year to develop a plan to bring every school district in the state to full funding within five years, with annual increase of $100 million. Governor Christie has questioned whether the Sweeney plan goes far enough in media reports.
Both Governor Christie and Senate President Sweeney have held town halls and roundtables over the summer to promote their respective plans and plan to hold more in August.