TEXT OF STORY
Doug Krizner: New Jersey has one of the highest debt burdens of any state in the union — $32 billion. But Gov. Jon Corzine has come up with a way to cut that in half, and have enough left over to fund future highway projects.
He’s been pitching the plan in a series of public meetings. As Eugene Sonn reports, it’s been uphill all the way.
Eugene Sonn: Raise the rates at New Jersey’s 66 toll plazas dramatically — that’s Gov. Corzine’s prescription for helping pay down the state’s colossal debt. Not surprisingly, New Jersey drivers are less than enthusiastic. It’s hard to avoid the state’s 300 miles of toll roads.
So the governor has scheduled 21 public meetings on the plan — like this one recently at a high school auditorium in Livingston:
Gov. Jon Corzine: The reality is that we have never priced our toll roads on an economically competitive basis with what’s going in the world — whether income growth, or it is the cost of living, or anything else.
Pleading his case has done little to sell Corzine’s plan, which would boost the typical trip on the New Jersey Turnpike from $1 now to more than $3 by 2014. And it’ll continue to climb for nearly 70 years thereafter.
Bud Booth, a former mayor of the bedroom community of Westfield, summed up the sentiments of many Garden Staters at the same meeting:
Bud Booth: I think it is wrong to solve all of New Jersey’s financial problems, which you have outlined very well and I agree with… It’s wrong to stick this all on the toll road users of the state.
Corzine’s plan is similar to Indiana’s revenue-generating move to lease its turnpike to a private operator. Corzine says New Jersey would get $30 to $40 billion immediately by having a non-profit agency issue bonds against the future toll revenue.
Critics question the wisdom of retiring debt by borrowing more. Rutgers University economist Joseph Seneca says the plan wouldn’t so much cut New Jersey’s debt as force someone else to make the state’s payments.
Joseph Seneca: It will free significant resources, probably in the neighborhood of $2 billion a year, for use in the budget and transportation projects. It does that by shifting those debt-service costs onto highway users — drivers and the trucking industry.
Seneca praises other parts of the plan, such as freezing the state budget and restricting future spending.
Some critics are urging a hike in the state’s gas tax instead — it’s the fourth-lowest in the nation. Corzine says he doesn’t want to do that, with pump prices around $3 a gallon. And he says tolls are a better option, because drivers just passing through New Jersey pay half the tolls anyway.
I’m Eugene Sonn for Marketplace.
Marketplace is on a mission.
We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.
Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?