N.J. Legislature expects to consider gas tax hike

TRENTON - Two days after expanding their majority in the Assembly, New Jersey Democrats on Thursday claimed a mandate to push a "middle-class agenda" that would fund transportation infrastructure, pensions for public employees, and schools.

Leaders of both parties jousted over what fueled the election results: Gov. Christie's failed policies, in the words of Democrats, or special-interest money attacking GOP candidates, said Republicans.

But with the election and a months-long policy-making hiatus behind them, lawmakers Thursday moved their focus to the challenges facing the state.

Christie's administration has said the fund for road, bridge, and rail maintenance and repairs will run out of money when the fiscal year ends June 30. Democrats on Thursday renewed their call for a long-term funding plan that would dedicate revenue for transportation projects instead of relying on borrowing, as the state has in the past.

Assembly Speaker Vincent Prieto (D., Hudson) said the Transportation Trust Fund could be replenished only by raising the state's 14.5-cents-per-gallon tax on gasoline, the second-lowest in the nation.

All revenue from the gas tax currently goes toward paying down existing debt. Some lawmakers, as well as Christie's former transportation commissioner, tried to solve the problem over the last year, but politics ultimately derailed a solution.

Prieto, who was reelected to the Assembly leadership post for another two-year term, said that along with raising the gas tax, he was open to phasing out the estate tax, often referred to by Republicans as the "death tax."

For the current fiscal year, the estate and inheritance taxes combined are projected to collect $755 million, the fourth-largest source of state revenue, according to the nonpartisan Office of Legislative Services.

An immediate and full-scale repeal of the estate tax would create a "hole in our budget that we can't afford," Prieto said.

His Republican counterpart, Minority Leader Jon Bramnick of Union County, appeared amenable to the broad contours of that plan and said he expected to strike a bipartisan solution.

"Even the governor said taxes are on the table," Bramnick told reporters. "You can't close the roads."

He added, "We're talking about sending a message to voters that hey, there may be a tax increase on gas, but we're looking to lower some other taxes. That's a good start."

Christie, who is seeking the GOP presidential nomination, has suggested he would be open to a gas tax hike if a proposal results in "tax fairness" for the people of New Jersey.

Christie "has other aspirations at this point in time," Prieto said. "Let's see how receptive he is."

Prieto said he would try to solve the transportation funding crisis by the end of the current legislative session in January but noted that lawmakers have until late June to do so.

"Once we get that accomplished, that will spur our economy," he said.

More immediately, Christie is expected to take action Monday on a package of bills the Legislature passed this year that is designed to stabilize Atlantic City's finances.

In a statement Monday, Joe Kelly, president of the Greater Atlantic City Chamber of Commerce, said his group was "increasingly concerned about the impact on the businesses in the region if those bills are not implemented."

A spokeswoman for the governor said the bills were still under review.

Also Thursday, Democrats predicted that negotiating with Republicans on transportation funding, pensions and health benefits, and other issues would be easier going forward.

"The landscape has changed dramatically," said Assembly Majority Leader Louis D. Greenwald (D., Camden), who was reelected to his leadership post.

He cited the Senate's vote last month, with the support of three Republicans, to override Christie's veto of legislation that would make it more difficult for some individuals with a history of mental illness to expunge such records for the purpose of obtaining a firearm. It was the first successful override vote since Christie took office.

"If you are a Republican left standing right now after last Tuesday that hung on by 100 to 200 votes, you have to make a decision," Greenwald said. "Are you going to stand and blindly follow [Christie] on these types of public policy when you're watching it impact the economy of the state, the debt service of the state, the financial borrowing of the state?"

The state likely won't certify election results until next month, and both parties indicated a recount was likely in the 16th District, where Democrat Andrew Zwicker, a Princeton physicist, leads Republican incumbent Donna Simon by a few dozen votes. Provisional ballots were still being counted Thursday.

Should Zwicker hang on, Democrats would pick up four seats in the election and hold a 52-28 majority in the Assembly, their largest since the late 1970s. They also control the Senate.

Leaders of both parties also expressed interest Thursday in finding a way to reduce New Jersey's property taxes, which are among the highest in the nation. However, lawmakers were light on specifics.

"The Democrats have picked up a few seats, and now they have an opportunity to present their plan," Bramnick said. "In the next few months, the people of New Jersey will have an opportunity to learn about what they intend to do to lower taxes in the state, make it more competitive for business and employers, and give an opportunity to the middle class to get jobs and increase the economy."

Senate Republicans and Democrats also announced their leadership teams on Thursday. Senate President Stephen Sweeney (D., Gloucester) and Majority Leader Loretta Weinberg (D., Bergen) were reelected to their posts, as was Minority Leader Thomas H. Kean Jr. (R., Union).

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