Corzine’s Public Benefit Corp all but dead thanks to “A Different Road”

Corzine says the state is nearly broke: Wisniewski challenges that statement head-on:

“New Jersey maintains an “AA-‘ bond rating on Wall Street. “Goldman Sachs, who everybody would acknowledge is a world-class financial operation on Wall Street, shares exactly the same financial rating as the State of New Jersey,” Wisniewski said. Corzine used to run Goldman Sachs.

Corzine’s Public Benefit Corp is likely all but dead thanks to Assembly Transportation Committee chairman John Wisniewski’s recommended plan.

Although the 18 cents gas tax hike may not be the ultimate answer, it does have a much more reasonable moderate Toll increase schedule and he does have the Trenton Legislators buzzing about it. The problem as I see it however, is that IT DOES NOT ADDRESS THE ROOT CAUSE. In other words, there’s nothing in the plan that calls for CUTTING spending (only freezing). Some Republican legislators, (preferably a newly elected official(s) like Scanlon/Casagrande/Beck?) need to submit another alternative that may incorporate “a modest” gas tax with across the board cuts.

Wisniewski’s plan would not cut state debt, which is a key element of Corzine’s proposal to raise tolls by roughly 800 percent by 2022 and by inflation from then on. Corzine has said reducing debt could save the state $1 billion a year in interest payments over the next decade.

But Wisniewski said his plan would more fairly spread the costs among all motorists.

“An 800-percent toll increase was going to fund transportation. I find that unacceptable,” Wisniewski said.

He said Corzine’s proposal would unfairly hit seven counties, including Middlesex, Monmouth and Ocean, that rely on the state’s toll roads while asking much less of the rest of the state. Wisniewski’s alternative would roughly double tolls by 2018 and would direct the money raised back to projects on the toll roads.

Corzine’s proposal would halve the state’s $32 billion debt, at least temporarily, and fund up to 75 years of transportation projects.

Under Wisniewski’s plan:

  • The gasoline tax would grow by 18 cents, with inflationary increases following to fund transportation projects.
  • On the Parkway, tolls would grow from 35 cents now to 75 cents in 2018. Corzine’s plan would raise the same toll, in four installments, to $2.70 by 2022.
  • The Turnpike would see three 25-percent toll hikes in place of Corzine’s four increases of 50 percent plus inflation. That means today’s $1.20 average trip would cost $2.35 in 2018 under the Wisniewski proposal, compared with the $9.85 by 2022 called for by Corzine.
  • A 50-cent Expressway toll would become $1 by 2014, compared with $4.05 by 2022 under Corzine’s plan.

Wisniewski also endorsed the same spending controls as Corzine, and even tighter restrictions on new borrowing.

“The governor is pleased that an active dialogue has emerged on how to put New Jersey on the path to fiscal responsibility while also recognizing the need to fund critical, long-term infrastructure improvements,” Corzine spokeswoman Lilo Stainton said.

Other lawmakers react

A Democrat whose support is key to Corzine’s plan, Sen. Raymond Lesniak, D-Union, applauded Wisniewski’s approach. Lesniak, who is sponsoring the Corzine proposal, said it will be much easier to convince toll-road drivers to support fee increases if they see the funding coming back to the highways they use.

“The governor trying to do everything all at once in one big bundle; that’s too complex to do it all in one way,” Lesniak said.

(That’s Trenton talk for: I’m not supporting Gov. Corzine’s plan any longer)

He said that once the state finds a source of transportation funding, a separate debate can begin on reducing debt.

But Senate Majority Leader Stephen Sweeney, D-Gloucester, said talk of a gas-tax hike is premature.

“Right now, there’s no reason to talk about a gas tax, there’s no reason to talk about toll increases until (Corzine) presents his budget,” Sweeney said.

Corzine is scheduled to lay out his plan Tuesday, and Sweeney, like other lawmakers, has called for reduced spending to alleviate the state’s financial problems.

Wisniewski disputed Corzine’s assertions that the state is nearly broke.

“Bankrupt really means that you’re insolvent, that you can’t pay your bills. That’s not a situation where New Jersey is at. We can pay our bills,” Wisniewski said.

He said New Jersey maintains an “AA-‘ bond rating on Wall Street, similar to most other states.

“Goldman Sachs, who everybody would acknowledge is a world-class financial operation on Wall Street, shares exactly the same financial rating as the State of New Jersey,” Wisniewski said. Corzine used to run Goldman Sachs.

New Jersey’s debt costs the state $2.6 billion in payments each year, and growing pension and health care liabilities cost another $2.2 billion a year, according to the administration. Corzine has said those payments severely restrict the state’s ability to pay for needed programs and repairs.

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