Bill including gas tax hike, new fee for electric cars heads to Gov. Murphy’s desk

The Legislature approved a bill Monday that includes an annual 2-cent gas tax hike for the next five years and a new registration fee for electric vehicles, sending the measure to the governor’s desk for his approval.

The bill would reauthorize the transportation trust fund, which is used as a funding source for highway and transit projects and was set to expire June 30, until fiscal year 2029.

“Without such renewal, ongoing projects will languish and costs will skyrocket — reminiscent of the hardships endured during previous shutdowns that some of you may have been here to face,” said bill sponsor Assemblyman Clinton Calabrese (D-Bergen).

The legislation would change the state’s gas tax formula beginning July 1, with the goal of raising $2.4 billion in new revenue over the next five years.

The new electric car fee, which would also begin July 1, would be in addition to existing registration fees. The fee would increase by $10 a year until it reaches $290 in 2028.

Gov. Phil Murphy has indicated he would sign the bill. The Legislature voted along party lines, with Republicans criticizing the fast-tracked bill as one that would hurt motorists.

Sen. Tony Bucco (R-Morris) attempted to move the bills back to committee for amendments, but he was trumped by Democrats who tabled that motion. He suggested another plan sponsored by Republicans that would have dropped the gas tax hike and dedicated $100 million from electric vehicle sales to the transportation trust fund over a longer period of time.

Assemblyman Christian Barranco (R-Morris) said the Legislature is “just making it more and more expensive” to live in New Jersey.

“We need to be smart about what we’re doing with our money. This is a very, very bad way about going forward and trying to fix the roads and bridges — that we have the money for,” he said.

Sen. Bob Smith (D-Middlesex) criticized the new registration fee, calling it a “policy mistake” to penalize people for buying electric cars, but ultimately voted for the bill.

Calabrese said the bill would support more than 20,000 jobs. Passing the bill would continue ensuring the continuation of infrastructure projects that drive our economy and enhance the lives of all New Jerseyans, he said.