Which of Your Tax Bills Should Cover Cost of NJ Roadwork Shutdown?

TRENTON — Roadwork that’s been shuttered since early July at the governor's direction is going to cost extra once it’s eventually restarted. An Assembly panel has endorsed the idea of making sure the state pays for that, not municipalities and counties.

The costs associated with stopping and restarting construction projects haven’t been calculated and aren’t even clear. But contractors say there’s a cost, and local governments fear being sued for stopping projects for months. Local officials have a sympathetic ear in the Assembly transportation committee.

“Local governments in New Jersey are not to blame for the lack of a (Transportation Trust Fund) plan, yet they could ultimately be on the hook for these enormous cost overruns. And that means their local property taxpayers will have to bear the cost,” said Assemblywoman Elizabeth Muoio, D-Mercer.

New Jersey can't pay for roadwork because all of the money that goes into the Transportation Trust Fund, including the 14.5 cents a gallon in gas taxes, is now being used to pay off $16 billion in debt. Gov. Chris Christie and a majority of lawmakers have agreed to a 23-cent a gallon gas-tax hike, but they can't agree on accompanying tax cuts being pursued as part of a political bargain.

As a result, most state-funded roadwork has been stopped since early July. The costs for moving and securing heavy equipment and idled job sites will vary. Even now, in the 13th week since the impasse began, there aren’t any specific projections of the financial impact.

“The fact is that we have no cost estimate, and that’s one of the reasons why I can’t support this bill, because we have no idea where this goes. We have no money in the TTF right now,” said Assemblyman Scott Rumana, R-Passaic.

Muoio said the bill isn’t about the size of the check, it’s about who picks it up.

Assemblyman Gregory McGuckin, R-Ocean, said he understands why local governments would want the state to pay but noted that, in the end, it’s the same group of taxpayers.

He voted against the bill, saying he doubts contractors are going to sue because they understand the shutdown occurred because state funding wasn’t available.

“Is there really a possibility that this is going to be a legal detriment to the municipalities and counties? Is that really a legal likelihood? Because I quite frankly don’t think so,” McGuckin said.

At least five counties have notified the state they intend to sue over the withheld funds, though executives from local government organizations weren’t able to point to any lawsuits yet filed by any disgruntled contractors.

“There are county administrators that I have spoken with that have said they know that these claims are coming,” said John Donnadio, executive director of the New Jersey Association of Counties.

Representatives of associations for counties and municipalities say it’s unfair for local governments to face the prospect of higher costs and legal exposure caused by the state’s inability to provide local aid it had already awarded.

“Local governments entered into contracts. They will be expected to uphold those contracts and hold up their end of the bargain. And we simply ask that the state does the same as well,” said Mike Cerra, assistant executive director for the New Jersey State League of Municipalities.

The bill was amended to permit a local government to use its own funds to continue or complete a transportation project halted by Christie’s executive order and prohibit the state from withholding, revoking or canceling local aid due to a locality’s decision to use its funds to keep a project going.

The state warned local governments in July that their aid could be in jeopardy if they didn’t stop projects, as directed. Some towns, like Piscataway, forged ahead anyway. Last week, the state gave permission to Somerset County to fund a shuttered bridge project in Franklin and Rocky Hill, but such authorizations have been rare.

“It’s not fair, it’s not right, and it’s not in the best interests of our state,” Muoio said.

All the Democrats on the Assembly transportation committee voted for the bill. One Republican did, too: Assemblywoman BettyLou DeCroce, R-Morris, who called for cooler heads to prevail and for an overall solution to the TTF impasse to be found.

“It’s very hard on the taxpayers,” DeCroce said. “We’re in a very bad position right now and of great concern to any of us that care about the economic viability of this state.”