Transit agencies throughout the country are facing fiscal crises after ridership droppedsome 90% during the early days of the pandemic, rebounding only slowly. Federal funding kept trains and buses running, and as that funding ends, agencies are looking at a dismal financial future. This is where NJ Transit finds itself, with a looming fiscal
shortfall of almost $1 billion in Fiscal Year 2026. At the same time, as of December 31, 2023, the largest corporations in the state, those with profits of more than $1 million annually, were released from a temporary
2.5% corporate business tax, as promised by Governor Murphy. However, looking at the state budget and NJ Transit’s coming financial disaster, the governor proposed renewing the recently expired tax as a “corporate transit fee”, applicable to fewer companies (those making $10 million, not $1 million, in profit annually), still at 2.5%. Advocates liked the idea, though not the proposal to make this available to NJTransit only in 2026. Of course, the business community has objected since the plan was announced. Lackawanna Coalition members largely like the idea, even as a few worry about the increased tax making New Jersey less competitive in attracting and retaining businesses. Overall, though, in some sense, even with taxes, “you get what you pay for”:
employers like our highly-educated workforce, the proximity to New York City and Philadelphia, the good schools for their children—and yes, the third-largest regional transit system in the country. Given the $10 million threshold for paying this fee, most businesses will be exempt, and the few hundred that are affected can well afford to support this important public service.
Leave a Reply