Governor Murphy’s FY20 NJ Transit Operating Budget Proposal Shortchanges NJ Transit

CONTACT
Janna Chernetz, Deputy Director, Tri-State Transportation Campaign, (609-271-0778)
Nat Bottigheimer, New Jersey Director, Regional Plan Association (609-955-0456)
Debra Coyle McFadden, Executive Director, NJ Work Environment Council (609-707-1320)
Sara Cullinane, Director, Make the Road NJ (908-768-4991)
Doug O’Malley, Director, Environment New Jersey (917-449-6812)
Jeff Tittel, Senior Chapter Director, NJ Sierra Club (609-656-7612)
Missy Rebovich, Director of Government & Public Affairs, New Jersey Future (609-577-2734)

 

Governor Murphy’s FY20 NJ Transit Operating Budget Proposal Shortchanges NJ Transit

Governor Murphy’s Proposal To Increase Funding for NJ Transit’s FY20 Operating Budget by Only $25 Million Will Further Constrain the Already Financially Starved Agency

TRENTON, May 9, 2019 — Today a diverse group of transportation, environment and equity advocates gathered at the State House to voice their concerns regarding the continued underfunding of NJ Transit.

NJ Transit, the once nationally recognized public transportation agency, was left to decay under the prior administration. Financially starved and lacking leadership, the agency has barely been able to keep up with the needs of the state. Within the first few days of taking office, Governor Murphy signed EO5, ordering a full-scale $1.5 million comprehensive audit of the agency. The results of the audit were released in October 2018 and identified a lack of stable funding as an underlying problem for the agency. “Comprising unsustainable and unpredictable sources; diversions, transfers and state subsidies which are subject to the annual political budget process, the agency lacks the ability to engage in meaningful long term planning, hold fares stable and meet the service demands of commuters all while struggling to keep up with the maintenance needs of the existing network,” said Janna Chernetz, Deputy Director, Tri-State Transportation Campaign. “After decades of neglect, it is time to put NJ Transit on the path towards fiscal solvency and that needs to start with FY20.”

Governor Murphy’s FY20 proposal for NJ Transit’s operating budget is $2.341 billion and includes a direct state subsidy of $407.5 million, $82.1 million raid from the Clean Energy Fund, $129 million from the NJ Turnpike Authority, and a $460 million transfer from the agency’s own capital budget. While the budget proposal does increase the direct state subsidy by $100 million, $75 million of that is being used to reduce the capital-to-operating transfer and diversion from the NJ Turnpike. Thus, the net increase from the state is only $25 million. This proposal is a meager 1.6% increase over FY19, whereas FY19 was a 4.4% increase over FY18. At
this rate, the Murphy administration is on track simply to meet the growth rate of that under the Christie administration, which was just shy of an average 3% annually.

“NJ Transit has been making progress, but that progress is going to hit a brick wall unless we come up with more funding for the agency. The $25 million increase to its budget is not enough to hire more staff and make the reforms the agency desperately needs. Raiding the Clean Energy Fund and capital money for operations is also bad fiscal policy. It takes away from other important environmental programs and capital funds to electrify our bus fleets, buy more rail cars and extend services,” said Jeff Tittel, director of the New Jersey Sierra Club. “If we don’t come up with the funding, the transit nightmare will come back. We need to fix this and put in the resources this year if we want to fix NJ Transit and get people to work on time.”

One the most debilitating funding practices utilized to stabilize NJ Transit’s operating budget is the capital-to-operating transfer. This practice began in 1990 with only $90 million. However, the reliance on this funding mechanism has grown substantially in almost 30 years, to $460 million in this year’s proposed budget and an all-time high of $510 million just last year. “Paying for transit operations with capital dollars is like using the college fund to pay for groceries,” said Nat Bottigheimer, New Jersey director, Regional Plan Association. “This is a terrible practice we must abandon if we’re to have a healthy economic future. We can do that by creating new, reliable sources of money for bus and rail operations; by investing in more efficient transit business practices; and by taking advantage of the many sources of value that great transit service creates.”

More than half of New Jersey’s harmful greenhouse gas emissions come from the transportation sector; therefore, it’s also vital to keep capital dollars in the capital budget to improve the state’s environmental health and the health of its residents. “Full funding of New Jersey Transit must be a top priority for the state. In addition to needed capital upgrades and expansion of service, we need to make it a 21st-century transportation system that includes electrification of buses. Electrification of New Jersey’s transportation system cannot wait — it is the largest producer of greenhouse gas emissions in New Jersey and, according to the IPCC, we only have a decade to get climate change under control before it’s too late,” said Debra Coyle McFadden, executive director of New Jersey Work Environment Council.

“NJ Transit was left for ruin by the Christie administration, and we’re still feeling the impacts of a decade of disinvestment. To restore NJ Transit to full capacity, we need to work to create a dedicated source of transit funding like every other comparable transit agency. We need more funding for NJ Transit this year — and every year forward. We need both the Legislature and the Murphy administration to work for a long-term funding solution that will put NJ Transit on the financial footing to be a truly functioning transit agency,” said Doug O’Malley, director of Environment New Jersey.

“New Jersey needs reliable public transportation if we want to be a real economic powerhouse, and that means funding NJ Transit properly and providing a stable source of funding,” said Missy Rebovich, director of government and public affairs, New Jersey Future. “We know that people want to live near transit, but in order to make that a reality, we need to ensure that our transportation system can perform necessary upgrades and even expand its service.”

“A $25 million net increase in NJ Transit’s operating budget is plainly inadequate. From recent experience we know how adversely this type of NJ Transit underfunding has harmed the state’s economy and psyche. The Legislature must act, somehow, to avoid a recurrence of these undesirable consequences,” said Martin Robins, director emeritus, Rutgers University’s Alan M. Voorhees Transportation Center.