All About Debts

Debt Help Desperate to avert massive cuts in road and mass transit projects, state transportation officials have crafted a plan to borrow $900 million next year, tapping a financial source New Jersey has not used before.

First, Ballot Question 3, if approved, would add substantial debt to our state. New Jersey now has $3.17 billion in general obligation bonds that must be paid off. We have an additional $1.15 billion in debt that has been authorized by the voters but for which bonds have not been issued. We have a total state debt of $16.8 billion. In the current fiscal climate, the board of the League of Women Voters of New Jersey feels this is an unnecessary new burden for New Jersey taxpayers.

Counseling Debt Even with the stop-gap funding, officials said they will have to eliminate or delay some transportation projects. They said they are still putting together the list of cuts and probably would complete it within a week. Work on projects already under construction would continue, they said.

Consolidation Consumer Debt Critics accused the McGreevey administration yesterday of resorting to the same short-sighted financial maneuvers that put the state's transportation funding program in crisis mode in the first place.

You won't be allowed to file for Chapter 7 if your income is above your state's median income and you can afford to pay 25 percent of your unsecured debt. Even if your income is below the state's median income and you can pay 25 percent of your unsecured debt, the court may still deny your Chapter 7 filing.KThere will be very few exceptions to this test, no matter how sympathetic your case is.

Debt Settlement The state would begin making annual payments on the $900 million in bonds during the first year after Gov. James E. McGreevey's current term ends. The debt payments -- which would start in fiscal year 2007 -- would be roughly $90 million to $100 million per year for up to 12 years, officials said.

An estimated 2.4 million people in the UK have yet to pay off debts incurred last Christmas, according to new research by debt counselling firm One Advice.

Debt Free "I think this is a total mistake. This governor is mortgaging the state for God knows how many years," Assembly Minority Leader Alex DeCroce (R-Morris) said. "He's doing the same things he accused (former Republican Gov. Christie) Whitman of doing."

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Consolidation Debt Service "This is different," said Kris Kolluri, the transportation department's chief of staff. "We know that transportation is critical to the recovery of this state. We will not jeopardize the economic recovery of this state."

Company Consolidation Debt Next year, the $805 million in revenue earmarked for the Transportation Trust Fund -- the program that pays for major road and mass transit projects -- would all be used for debt payments. That has left the state unable to use traditional borrowing techniques to keep money flowing to the roads, rails and buses.

Consolidation Debt Online As a result, Kolluri said the state has turned to something called indirect Garvey bonds, a method used by 22 other states, but never before by New Jersey. The bonds are secured by the guarantee of federal transportation money in future years.

Consolidation Debt Free But Kolluri said New Jersey does not plan to use the federal transportation funds to pay off the indirect Garvey bonds when they come due. Instead, he said, the money would come out of the state's general budget. The plan has the support of labor leaders and contractors, Kolluri said.

Debt Problem The transportation department found itself in a bind back in December when McGreevey decided not to push ahead on a plan to increase the gasoline tax after the proposed hike came under strong opposition from Republicans.

Credit Debt "Under the circumstances of the serious and unfortunate impact that would occur if funding were not found, then this is a helpful response," said Martin Robins, executive director of Rutgers University's Transportation Policy Institute, referring to the new borrowing plan.

Advice Debt "But it does not by any means relieve us of the massive question before the political leaders and the voters in the state of New Jersey as to how we're going to pay to finance transportation over the long-term," Robins said.

Card Credit Debt Eliminate Officials said the state could borrow the $900 million without approval from the Legislature or the voting public. That power was given to the Transportation Trust Fund Authority in legislation passed in 1996 and 2000, which set limits for the program's debt.

Debt Recovery In the current fiscal year, which ends June 30, the state is spending $2.58 billion in federal and state money on road and mass transit projects.

Counseling Credit Debt The funding crisis looming in 2005 already has affected the list of projects being put together this year, officials said. In some cases, the state likely will have to scrap projects that would have been done over several years.

Consolidation Debt Uk Officials said they have decided not to impose an increase in mass transit fares this year.

Debt Reduce By Joe Malinconico
Star-Ledger - 2/5/2004

Topic: Transportation

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