Friday, November 21, 2014
Inquirer Daily News

Christie's Borrowing Binge Makes Transportation Trust Fund Run Dry

Despite his promise to increase pay-as-you-go financing for the Transportation Trust Fund, Gov. Chris Christie has relied so heavily on debt for four years that the program will run out of borrowing capacity a year early, leaving the Christie administration without the funding it needs to pay for highway, bridge, and mass transit construction fifteen months from now.

Christie’s Borrowing Binge Makes Transportation Trust Fund Run Dry

Despite his promise to increase pay-as-you-go financing for the Transportation Trust Fund, Gov. Chris Christie has relied so heavily on debt for four years that the program will run out of borrowing capacity a year early, leaving the Christie administration without the funding it needs to pay for highway, bridge, and mass transit construction fifteen months from now.

Christie, who complained during his budget speech about the rising cost of debt payments, not only increased transportation debt by $1 billion more than expected during his first four budgets, but also borrowed money at above-market interest rates in order to generate an extra $250 million in up-front bond premium payments to replace New Jersey Turnpike toll money he used to balance his budget.

“The bottom line is that New Jersey’s transportation system is broken, Gov. Christie has once again failed to make good on his promise to fund transportation with more cash and less debt, and there is not enough money in the system to pay for transportation projects next year,” said Janna Chernetz, New Jersey Advocate for the Tri-State Transportation Campaign."

“While this is certainly not good news in terms of the state’s mounting debt, it also does not come as a shock,” she said. “We never believed he would put in the pay-as-you-go money he promised. Christie’s entire five-year, $8 billion plan was financed using debt and the spoils from the canceled ARC Tunnel, which will run out in 2016. He won’t raise the gas tax, but he can’t just keep borrowing. What’s next?”

Chernetz and transportation finance experts have been predicting for a month that the Christie administration had been borrowing at such a heavy rate that it would not have enough debt capacity left to complete the $8 billion program of transportation infrastructure improvements that is considered critical to the state’s economic growth.

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