ASSEMBLY, No. 750
STATE OF NEW JERSEY
Introduced Pending Technical Review by Legislative Counsel
PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION
By Assemblymen SULIGA and ROBERTS
An Act requiring that certain decreases in revenues for municipal distribution under the public utility gross receipts and franchise taxes be restored from State revenues, supplementing P.L.1940, c.4, and P.L.1940, c.5.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. The Legislature finds and declares that recent federal legislation to deregulate gas sales in the United States requires that gas consumers be allowed to buy natural gas from sources other than the public utility franchise holder in their area and that whereas increased competition in the gas markets is intended to increase the efficiency of gas supplies and lower costs, that nonetheless the current system of public utility taxation is based on the old system of exclusive franchises for the sale of gas and the gas sold under the new deregulated system often escapes taxation.
The Legislature further finds and declares that public utility taxes are a significant and essential component of the revenue stream that is collected by the State for municipalities, and this municipal revenue is eroding as more gas is sold through the deregulated market. The State collection of public utility taxes, and the distribution of the utility taxes in lieu of real property taxation of utility assets, is an the outcome of an agreement between the State and the municipalities to substitute a Statewide uniform system of tax assessment in place of a piecemeal system of municipal assessments. That agreement is a contract between the State and the municipalities. The State must meet the terms of its contract with municipalities, and it is necessary that, as in times of increasing revenue the State has diverted what would otherwise be municipal revenue, in times of declining revenue the State support the levels of municipal revenue.
2. Notwithstanding the provisions of any other law to the contrary, any decline in the revenues available for apportionment and payment to municipalities from taxes collected pursuant to P.L.1940, c.4 (C.54:30A-16 et seq.), P.L.1940, c.5 (54:30A-49 et seq.), and P.L.1991, c.184 (C.54:30A-18.6 et al.) due to the federal deregulation of public utilities shall be made up from what would otherwise be revenues for State use thereunder.
3. Notwithstanding the provisions of any other law to the contrary, any decline in the revenues available for apportionment and payment to municipalities from taxes collected pursuant to P.L.1940, c.4 (C.54:30A-16 et seq.), P.L.1940, c.5 (54:30A-49 et seq.), and P.L.1991, c.184 (C.54:30A-18.6 et al.) due to the federal deregulation of public utilities shall be made up from what would otherwise be revenues for State use thereunder.
4. This act shall take effect immediately.
STATEMENT
Recent federal legislation to deregulate gas sales in the United States requires that gas consumers be allowed to buy natural gas from sources other than the public utility franchise holder in their area. The current system of public utility taxation is based on the old system of exclusive franchises for the sale of gas and the gas sold under the new deregulated system often escapes taxation.
This bill requires that any decreases in revenues for municipal distribution under the public utility gross receipts and franchise taxes that are due to the federal deregulation of public utilities be restored from State public utility revenues.
Requires that any decreases in municipal distributions under the public utility gross receipts and franchise taxes due to the federal deregulation be restored from State revenues.