New Jersey drivers brace for possible end of cheap gas

David Porter, Associated Press

New Jersey's low gas prices have always served as a welcome antidote for residents burdened by a seemingly endless series of toll and fee increases, not to mention the nation's highest property taxes.

 

NEWARK, N.J. (AP) — New Jersey's low gas prices have always served as a welcome antidote for residents burdened by a seemingly endless series of toll and fee increases, not to mention the nation's highest property taxes.

Now, cheap gas in New Jersey may be going the way of the fax machine, leaving the state's roughly six million drivers doing the math to try and figure out how much pain they'll be in for.

The Democrat-led Assembly, with Republican Gov. Chris Christie's support, passed legislation early Tuesday that would raise the state's gasoline tax by 23 cents per gallon beginning Friday to fund road and bridge work. The measure heads to the state Senate on Thursday.

The increase would catapult New Jersey's current gas tax of 14.5 cents per gallon from second-lowest in the country behind Alaska to roughly equal that of Connecticut, which has the sixth-highest at 37.51 cents, according to the Tax Foundation, an independent tax policy research organization.

It would be accompanied by a decrease in the state sales tax from 7 percent to 6 percent phased in over the next 18 months, and a cut in the tax on retirement income. The sales tax would drop to 6.5 percent on Jan. 1 and then to 6 percent a year later. Christie said it's the first broad-based tax cut for all New Jerseyans since 1994.

Weighing the gas tax versus the sales tax was foremost in the minds of motorists Tuesday.

"I don't know if it offsets it, because it's 23 cents a gallon, and for the amount of traveling — especially for the amount of traveling I do, and that people do, it just makes it feel like the government just wants more and more," said Mary Noel, 59, a schoolteacher from Pittsgrove.

New Jersey's average price for a gallon of regular unleaded was $2.11 last week, according to AAA-Mid-Atlantic. That means it would cost $3.45 more to fill up a vehicle with a 15-gallon tank under the higher rate.

New Jersey residents can take solace in the fact that even if the gas tax goes up 23 cents, it would still be less than in neighboring Pennsylvania (about 50 cents) and New York (about 42 cents), according to Tax Foundation figures.

Eric Frye, 32, a wastewater operator from Woodstown, said he drives 50 miles per day, seven days a week for work and would rather see a sales tax increase.

"I would keep the sales tax high, and I would leave the gas tax alone," he said. "I would rather pay tax on goods that are luxury and not necessities. I consider gas to be a necessity for work."

The additional money would replenish the state's Transportation Trust Fund, which will lose its borrowing authority by the end of the month and is estimated to run out of money by early August. New Jersey Transit's proposed capital plan for the coming fiscal year includes $554 million from the fund for rail and bus projects.

"The goal is legitimate; there is a necessity here," said Anthony Sabito, a professor at St. John's University's Peter J. Tobin College of Business and a practicing attorney in oil and gas law. "You can't say it's pork barrel projects or a bridge to nowhere or some other nonsense. They're saying, 'We don't want to raise your taxes, but roads are crumbling.' So it's going to cost you more to go to the Paramus Mall but you'll pay less in sales tax when you go there. So it's almost a zero sum game."

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