We've all heard about the Reason Foundation study that claimed New Jersey had the most expensive roads in America. The Reason study was controversial and other studies refuted it -- such as the one coming out of Rutgers University's Voorhees Transportation Center.
Some politicians seized upon the Reason study to argue that cost-cutting efficiencies should be put in place before any more money went to repair and maintain the state's roads and bridges. We wonder if they would feel the same about the grossly mismanaged Veterans Administration -- close all those hospitals and services and dump the wounded out on the streets until the VA operates more efficiently.
Others claimed that they could fund the entire Transportation Trust Fund (TTF) with savings from efficiencies and cost-cutting. No numbers were produced to support this, but in testimony, Barauch Feigenbaum (Reason's Assistant Director of Policy) offered some excellent recommendations as to the areas in which significant savings could be achieved.
The lamentable fact is that not since 1990 has the state's user tax on gasoline and diesel produced enough revenue to cover the cost to maintain the state's transportation system. That year the gas tax collected $404.9 million to fund a $365 million transportation program. The tax on gasoline and diesel hasn't gone up for 28 years, hasn't even kept up with inflation, leading to more and more being borrowed to pay for road and bridge maintenance and repair. Today the cost of the debt service alone exceeds $1.1 billion. In contrast, the gas tax collected just a bit more than $750 million in 2015.
No wonder the author of the Reason study, David Hartgen (Emeritus Professor of Transportation Studies at UNC Charlotte), recently told New Jersey media that there was no way around the revenue problem the now-bankrupt TTF faces:
Even as some say his report proves that New Jersey must cut costs before hiking the gas tax, Hartgen says the opposite may be true. The transportation trust fund is now $30 billion in debt. Without new revenue from the gas tax or some other source, it cannot spend any money on new construction.
“I don’t think budget cuts will work,” Hartgen said. “They need to look at the gas tax.”