NJ Gas Taxes to SEC and Pulaski Skyway

We now know where a large chunk of the money from the increase in the gas tax will be going.

An order was released by the Securities and Exchange Commission soon after Governor Chris Christie’s state of the State speech yesterday announcing that:

In anticipation of the institution of these proceedings, Respondent has submitted an Offer of Settlement that the Commission has determined to accept. Respondent admits the facts set forth in Sections III. A, B., C., and D. below, acknowledges that its conduct violated the federal securities laws, admits the Commission’s jurisdiction over it and the subject matter of these proceedings, and consents to the entry of this Order Instituting Cease-and-Desist Proceedings Pursuant to Section 8A of the Securities Act of 1933, Making Findings, and Imposing a Cease-and-Desist Order (“Order”), as set forth below.

As covered by The Record:

Months before Gov. Chris Christie cited cost overruns as the reason he canceled a Hudson River tunnel project, his allies were scheming how to divert nearly $2 billion – much of it raised from travelers in the region —  to repair New Jersey roads, a government probe has found.

The Securities and Exchange Commission announced Tuesday a $400,000 settlement of its probe into why the Port Authority of New York and New Jersey spent $1.8 billion to repair New Jersey roads such as the Pulaski Skyway. That money had originally been set aside for the tunnel project.

In securing a rare admission of wrongdoing as well as its second-largest penalty against a municipal agency, the regulator delivered a sharp blow to Christie and his allies at the Port Authority and at the state Department of Transportation who directed the spending during Christie’s first term.

The settlement exposed private meetings and communications in which unnamed Christie allies planned how to fund road repairs by diverting almost $2 billion from a project to dig a trans-Hudson rail tunnel.

The discussions took place several months before Christie officially canceled the project, known as Access to the Region’s Core, or ARC.

The settlement also detailed how Christie’s allies planned to overcome the legally questionable decision to label the Pulaski Skyway and other roads as “access roads to the Lincoln Tunnel” — and to then push that decision past the Port Authority’s board of commissioners. The scheme was first uncovered by The Record in March 2014.

At the time Christie canceled ARC, in October 2010, he said he was doing so over mounting fears of cost overruns.

“He wasn’t worried about cost overruns,” said Assemblyman John Wisniewski, who chairs New Jersey’s Assembly Transportation and Independent Authorities Committee and who is running for governor this year. “He was worried about how he was going to fund these other projects, and that was why he canceled the ARC tunnel.”

11 responses to this post.

  1. I get the point about nefarious and disingenuous behavior, but isn’t it the case that $400K is but a drop in the bucket of what the gas tax inc will raise?

    Reply

    • Certainly the $400k amount is not enough to cover Christie’s lawyers campaign donations but the unreported question is where the money for the Pulaski Skyway will be coming from if not those Pot Authority bonds.
      It might be that all the new gas tax money is already spent.

      Reply

      • Posted by NY on January 11, 2017 at 1:36 pm

        Ah — I misunderstood initially; now makes sense. Maybe there’ll be a chapter about this in Christie’s book..a sort of “how-not-to” guide–

        Reply

  2. Posted by boscoe on January 11, 2017 at 2:49 pm

    At first (like NY above) I didn’t get where John was going with this because he connected the dots in his head and skipped straight through to his conclusion/proposition/question. A $400,000 settlement by the Port Authority vs. $1.2 billion in expected new revenue from the gas tax hike? After wading through all 14 pages of the SEC complaint and the Record story, I now understand — I think — that the Port Authority did NOT end up paying for the Pulaski Skyway out of PA bonds or other PA resources once the SEC started their investigation. So the question is, what resources were used to pay for the ongoing reconstruction work on the Skyway? Were funds reallocated from other Transportation Trust Fund projects? Were toll or bond revenues from the Turnpike and Parkway diverted? Or, as John intimates, is a whole bunch of the new gas tax revenue somehow earmarked directly or indirectly (backing new TTF bonds) for the Pulaski project? This should be “find-outable” with a little digging.

    Reply

  3. Posted by Anonymous on January 11, 2017 at 8:33 pm

    https://mobile.nytimes.com/2016/07/28/us/politics/donald-trump-russia-clinton-emails.html

    DD you are pathetic, as is Donald T Rump. He applauds US intelligence against Clinton but admonish their efforts against him. Let’s set the record straight, his entire tenure will be total deflection, never responsible for anything except what might go right.

    Reply

  4. Posted by Mitch on January 11, 2017 at 10:26 pm

    Blame and deflect. Sounds like….

    Reply

  5. Posted by MJ on January 17, 2017 at 4:59 pm

    John, I may have misunderstood it but with the passing of the Transportation funding referendum dedicating the gas tax, did it not also include raising the gas tax at will to pay for all of the borrowing that will not have to be approved by the voters to pay for it all? If true, then what does it matter of the cost as the gas tax can be raised in the name of repairing roads and bridges…….

    Reply

    • The most logical explanation I heard on this ballot question is that NJ is planning on doing a lot of bonding with the gas tax as what will repay those bonds but to be able to do that bonding they have to show in the Official Statement that they will not be able to steal the gas tax money and it really will go to repay the bonds they will buy.

      Nothing on going higher than 23 cents.

      Reply

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