ASSEMBLY APPROPRIATIONS COMMITTEE

STATEMENT TO

ASSEMBLY, No. 1261

STATE OF NEW JERSEY

DATED: FEBRUARY 22, 1996

      The Assembly Appropriations Committee reports favorably Assembly Bill No. 1261.

      Assembly Bill No. 1261 amends the provision of the "New Jersey Gross Income Tax Act" governing the amount that a taxpayer may elect to contribute from the person's State income tax liability to the "Gubernatorial Elections Fund," the fund from which moneys are paid to support public financing for qualified primary and general election candidates for the office of Governor. The bill replaces the current single contribution option of $1 with three alternative levels of contribution, $1, $3, and $5.

      The bill also provides for future adjustments in those checkoff options to reflect the increase in the cost of living. Computation of the amount of the increase will be done quadrennially on the same schedule as applies to the calculation of the cost-of-living adjustments currently applicable to other amounts under the gubernatorial campaign finance statute; the actual checkoff amount will be set by rounding the adjusted figure so computed to the nearest whole dollar amount.

      The bill will take effect on the January 1 following enactment and be applicable to the taxes due for the year of enactment.

FISCAL IMPACT:

      Currently, taxpayers contribute approximately $1.5 million to the "Gubernatorial Elections Fund" each gross income tax taxable year. If each of the current contributors elects to contribute the maximum $5 amount, fund contributions would be expected to increase $6 million to $7.5 million each year. However, because the number of taxpayers electing the checkoff is declining and some taxpayers are expected to elect less than the $5 maximum. The increase in contributions to the fund is expected to be less than $6 million.