Fueling up in New Jersey

Mention “gas” and “New Jersey” in the same sentence and two questions are likely to come to mind: 1) Why is it illegal to pump your own gas in New Jersey? 2) How can the gas taxes be so low?

The answer to first question turns out to be related to public safety. In 1949, the Retail Gasoline Dispensing Safety Act and Regulations declared:

“Because of the fire hazards directly associated with dispensing fuel, it is in the public interest that gasoline station operators have the control needed over that activity to ensure compliance with appropriate safety procedures, including turning off vehicle engines and refraining from smoking while fuel is dispensed.”

Anyone who’s watched the first Zoolander will recognize the wisdom of this policy, although the real motivation for the policy may be rooted in money more than safety. Be that as it may, the policy seems here to stay.

The same may not be true for the low gas tax.

The gas tax rate has been static for decades and is the second lowest rate in the nation; the motor fuel tax was set at 10.5 cents per gallon in 1988, and a 4-cent tax on petroleum products was added in 1990 for a combined tax of 14.5 cents per gallon (the rate for diesel fuel is slightly higher). Legislation currently under consideration would create a 12.5 percent petroleum tax and a 4-cent-per-gallon surcharge for diesel, meaning motorists would pay approximately 23 cents more at the pump (Politickernj.com). In addition, aviation fuel tax rates would increase. To mollify, the plan calls for phasing out the estate tax.

Previous attempts to raise gas tax rates have failed. Governor Chris Christie (R) opposes the idea and maintains that the Transportation Trust Fund is not in crisis. Other detractors of the proposed package are voicing various concerns, from the backlash of higher aviation fuel costs to potential fiscal problems caused by doing away with the estate tax.

Yet proponents of a gas tax speak of a bleak future for the fund and the infrastructure it’s supposed to maintain if additional revenue sources can’t be found. They say more money is needed to improve crumbling bridges, pothole-riddled roads, and mass transit systems. Few believe the proposed plan is perfect, but many are saying it is now time for a compromise (New York Times).

New Jersey is not the only state in the union weighing the pros and cons of fuel taxes. With an eye on the growing number of electric-powered vehicles on roads, California and Oregon are studying the feasibility of a charge-per-mile-driven system. Even Alaska, which boasts the lowest rate in the nation, is considering additional motor fuel taxes.

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