‘Rain tax’? Fix for N.J.’s infrastructure needs not found in stormwater tax bill

By Tony Bawidamann, New Jersey Business & Industry Association
Trenton | Feb 8, 2019 at 11:57 am
Op-Ed

New Jersey needs to upgrade its aging water infrastructure systems. The task is enormous and expensive, so we cannot afford to waste time and money on an inefficient system.

A bill currently on Gov. Phil Murphy’s desk, however, is an example of how not to approach New Jersey’s infrastructure problem.

The legislation, which aims to cover the costs of managing stormwater and has been referred by some as a “rain tax,” allows local governments to set up their own authorities and impose fees on residents and business owners based on the amount of impervious surfaces — patios, parking lots, driveways — on their properties.

New Jersey has 565 municipalities. That’s potentially 565 individual authorities charging fees within their own boundaries, without having to consider how sewerage systems and stormwater in neighboring towns affects their projects. A county could decide to have a stormwater authority, as well, with this legislation, potentially forcing property owners to deal with two bureaucracies and fees for the same property.

The bill does not specify how much it would actually cost taxpayers, although it does say the fees could be increased above the 2 percent property tax cap.

Whatever their costs, these stormwater fees would amount to duplicative taxation for businesses, which already obtain permits from the Department of Environmental Protection. These permits come with steep application fees and oversight fees, as well as stormwater mitigation requirements they have to pay out of their own pockets.

As the largest business organization in the state, the New Jersey Business & Industry Association understands the importance of infrastructure. A couple of years ago, we supported comprehensive tax reform to save the Transportation Trust Fund, the main funding source for road and bridge construction. The TTF has a dedicated funding source, sets priorities and is in a position to tackle transportation problems regionally and even statewide if necessary.

We also understand the goal of the sponsor to address non-point source pollution, flooding and infrastructure needs. But New Jersey needs a comprehensive infrastructure plan to provide a predictable funding source and a way to prioritize projects in need, without overburdening our businesses with more bureaucracy and fees that don’t go toward their intent.

Finally, let’s not forget the critical fact that many of our businesses are already struggling to survive or thrive while existing with the worst business climate and highest taxes in the country. Adding a stormwater fee would cumulatively go on top of other taxes and mandates, like the $15 minimum wage, as well as high energy costs.

This legislation only attempts a piecemeal approach to addressing New Jersey’s stormwater and infrastructure issues, with certain additional costs but very uncertain results. We encourage Gov. Murphy to veto this bill.

Tony Bawidamann is vice president, government affairs, for the New Jersey Business & Industry Association.

ROI-NJ Staff | editorial@roi-nj.com | @ROINJNews