Somehow we ended up with four plans to fix the TTF. Here is a brief review of those four plans and how they developed (courtesy of Sussex County Watchdog):
(1) The Democrat Plan. This is the plan pushed by Democrats like Senator Ray Lesniak and Assemblyman John Wisniewski. It recognizes that the TTF has not been funded properly for decades. That since 1988, New Jersey has charged drivers just 14 1/2 cents a gallon of gasoline to maintain and repair our state's roads and bridges -- whereas states like Pennsylvania have had to charge their drivers over 50 cents a gallon. Instead of pay as you go, New Jersey has been running up the state's credit card to pay for roads and bridges. That's why the first dime (10 cents) of any tax increase will have to be used just to pay the interest on the debt. The Democrat plan is to raise the Gas Tax to pay for the TTF. Period. No tax cuts.
What stands in the way of the Democrat Plan is Republican Governor Chris Christie. Of course, after the Democrats take back the Governor's office in 2017, they and their overwhelming majorities in BOTH chambers of the Legislature will enable them to easily pass a gas tax of any amount they choose WITHOUT any tax cuts. That is 18 months away and counting.
(2) The Oroho Plan. Economists have long believed that one of the main reasons New Jersey ranks 49th out 50th for business environment is its high Estate Tax. Where most states have got rid of the Estate Tax and few have an inheritance tax, New Jersey has both. The Estate Tax kills job creation and results in the flight of capital and people from the state. New Jersey's tax on retirement income is another major factor in driving away people from the state.
Knowing that the Democrats don't need the GOP to pass a gas tax after 2017, Republican leaders gave Senator Steve Oroho the nod to negotiate a compromise with the Democrats that would address TTF funding in 2016 in return for tax cuts. Oroho did his job well and ended up with an economic recovery plan that not only phased out the Estate Tax and eliminated the tax on retirement income for over 90 percent of retirees, but cut four other taxes as well. It was an incredible accomplishment that few expected to happen. Unfortunately, the thinking within the GOP Senate leadership had changed by then. Now they were looking for a political angle.
(3) The Beck Plan. While Senator Oroho was negotiating in good faith, Republican leaders in the Senate decided to launch a political plan, on which they believed they could build a statewide campaign for the majority in 2017. This plan was sponsored by a member of leadership, Senator Jennifer Beck, who claimed that it could fund the TTF without an increase in the gas tax by borrowing $4.4 billion and freezing aid to municipalities and school districts (K-12) at the current level for seven years.
In addition, property tax relief was to be frozen for seven years -- along with tuition aid grants, NJ Stars, student financial assistance, higher education funding, hospital funding, and the State Police -- all frozen at the current level for seven years. The Beck plan also raided the state's Clean Energy Fund.
The Beck plan's numbers were seriously flawed and entirely reliant on economic growth. The plan would have bankrupted the TTF in the event of an economic downturn. Beck's rosy estimate of 3.15 percent growth was more than double the current year revenue growth of 1.5 percent. And her plan depended on the Democrats to enact $1.4 billion in health plan savings and on timely savings from the mergers of departments and agencies.
While Beck's plan did look at spending, she undercut her own argument when she voted for over $7 million in new spending for Planned Parenthood, the operators of abortion centers across the country.
There are no tax cuts in the Beck plan, no attempt is made to address the out-migration of income and capital. But the real risk to taxpayers represented by the Beck plan was two-part. First, that by freezing aid for seven years, it would force local governments and school boards to raise property taxes. Second, that the plan's flawed numbers would send the TTF into bankruptcy and result in a property tax explosion.
(4) The Christie Plan. On Monday, June 27th, the Governor entered into negotiations with Assembly Democrats on his own compromise plan. Throughout the day, the Governor's office ran the numbers in an attempt to reduce the amount of the tax increase on gasoline, but with the first 10 cents going to cover debt service, there was little he could do. Just before midnight, Governor Chris Christie and Speaker Vincent Prieto emerged from the Governor's office to announce their compromise.
The gas tax would still be raised 23 cents a gallon, the Republican Governor said there was no way around it if we wanted to keep roads and bridges safe and maintained. The Estate Tax phase out was gone, as were the other tax cuts negotiated by Senator Oroho -- with the exception of the elimination of the tax on retirement income. Oroho had negotiated an elimination of the tax for over 90 percent of New Jersey retirees. The Governor's plan lowered that to 80 percent.
The big change was the cut in the state sales tax to 6 percent. A half-cent in January and another half-cent by the end of 2017. The Governor's numbers show that whereas the gas tax increase will cost the average household $200 a year, the sales tax cut will save that household $400 a year.
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Why did the leadership of the Senate Republican Caucus encourage one of their members to negotiate a tax cut/TTF-funding deal, while a member of GOP leadership itself was allowed to publicly make war on that deal? Whatever the calculation, it has stirred-up a shitstorm and opened up the possibility of primaries against legislative Republicans across the state. A column run in yesterday's SaveJersey blog called for open Republican-on-Republican warfare:
And who are these offending Republicans? Here’s the Rogue’s Gallery – read it and make them weep:
Jon Bramnick, LD 21 (Union, Somerset and Morris); Chris Brown, LD 2 (Atlantic): Rob Clifton, LD 12 (Monmouth, Ocean, Burlington and Middlesex); BettyLou DeCroce, LD 26 (Morris, Essex and Passaic); Joe Howarth, LD 8 (Burlington, Atlantic and Camden); Sean Kean, LD 30 (Monmouth and Ocean); Nancy Munoz, LD 21 (Union, Morris and Somerset); David Rible, LD 30 (Monmouth); Maria Rodriguez-Gregg, LD 8 (Burlington, Atlantic and Camden) and Scott Rumana, LD 40 (Passaic, Bergen, Essex and Morris).
Note that many of this exceedingly motley crew are in the GOP leadership in the Assembly, including Assemblyman Bramnick, the putative leader of the caucus.
...For their support of the gas tax-hike abomination, the Gang of 10 need to be primaried, hounded, called out, denounced, condemned and run to ground as traitors to the state’s already oppressed taxpayers.
The writer also explicitly fingers the new GOP "Solutions NJ" super PAC as being "GOP up-and-comers who loathe the idea of a gas-tax hike." Does anyone really believe that they are going to primary Assemblyman Jon Bramnick? Should we really be spending down the slim resources we have in Republican on Republican battles?
Have the actions of the Senate Republican leadership attracted resources or driven them away? And now we face independent expenditures against our candidates. Why did Senator Jennifer Beck feel the need to be so militant and personal in her attacks on fellow Republicans? She's never treated the pro-abortion crowd that way and continues to vote for more spending for Planned Parenthood. Beck and Spadea stirred up an internecine mess that will be very difficult to rollback.