AASHTO Journal, 15 July 2016
Two weeks into an impasse over how to replenish New Jersey’s ailing Transportation Trust Fund, Gov. Chris Christie continued on his path to shut down $3.5 billion in road and transit project contracts and hundreds of workers were idled.
Negotiations reportedly continued between Christie and Senate leaders who maintained that a tax package Christie had negotiated with the Assembly, which passed it late in June, would leave a big hole in the overall state budget.
That package would have raised the state’s motor fuels tax by 23 cents a gallon on July 1, in return for cuts in the state sales tax and some retirement income taxes. It would reportedly provide the TTF $2 billion a year for eight years.
But the Senate did not take action on the plan before the July 1 start of the fiscal year. In response Christie ordered an “orderly shutdown” of non-federal and non-essential projects to ration funds that were expected to otherwise run out in August.
Those projects being suspended starting July 8 include $776 million in contracts under the New Jersey Department of Transportation and $2.7 billion managed by NJ Transit.
By July 13, about 800 construction workers had been reportedly idled by the closures and the impact was spreading.
Alison Premo Black, chief economist for the American Road & Transportation Builders Association, estimated that a full-week closure would “cost the transportation construction industry and New Jersey taxpayers at least $41 million and displace as many as 1,700 construction workers.”
ARTBA said Black’s analysis showed that as the shutdown continues “the cost could grow to as high as $1.3 million per day in lost sales, wages and economic activity” and affect an additional 1,500 non-construction jobs.
The political calendar could also affect the negotiations, reported a local CBS station, as Christie and many New Jersey GOP officials were scheduled to attend the Republican National Convention in Cleveland, Ohio, in the week starting July 18, and the Democratic National Convention was to follow one week later.