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Future of gas tax revenue poses questions for Transportation Trust Fund

Bureau of Labor Statistics

For the first time in eight years, New Jersey’s transportation trust fund, which helps pay for road work and a lot of other projects, has to be renewed — and by June 30.

The gas tax puts a lot of money into that fund, so the move toward electric cars raises some questions.
The state recently signed off on a rule banning the sale of new gasoline-powered cars in New Jersey beginning in 2035.

Greg Lalavee is the business manager of the union that represents the workers you see out on the highways.

“Gasoline and gas taxes are going to be a declining source of revenue, how are they going to continue to pave the same amount of roads, what’s the proposal to do that or what’s the discussion around doing it?” he asked.

Lalavee, who is also vice chair of the Transportation Trust Fund Authority, said the mechanics of driving electric cars could be a big factor in how much gas tax revenue could be replaced in an electric-car era. “We’ve been able to get a third of it (the gas tax) from out of state drivers, I don’t know if that’s the same metric with electric cars, I don’t know if as many are going to stop in New Jersey to recharge as they travel through here,” he said.

Last year, the New Jersey Department of Transportation launched a voluntary pilot program to explore the use of a mileage-based fee as an alternative to the gas tax.

Lalavee said the state’s ability to get federal funding to projects depends on the renewal of the trust fund.

“With the infrastructure bill that got passed through Congress out there, funding a lot of this, there are federal matching dollars to be had so it’s only better to have our house here in New Jersey in order,” he said.

Janice Kirkel is a lifelong award-winning journalist who has done everything from network newscasts to national and local sports reports to business newscasts to specialized reporting and editing in technical areas of business and finance such as bankruptcy, capital structure changes and reporting on the business of the investment business.