Employers in New Jersey and six other northeastern states on March 23 got their first look at the proposed Regional Greenhouse Gas Initiative (RGGI) model rule that will implement a costly new system to meet more stringent emission standards. NJBIA opposes RGGI because it will increase employers' costs, either directly in meeting the new emissions standards or indirectly through dramatically higher energy costs, but will have little effect on the environment.
The public has until May 22 to comment on the draft regulations, after which the RGGI Staff Working Group will have 45 days (July 6) to make changes and release the revised rule. Written comments should be submitted to RGGIcomm@gw.dec.state.ny.us. Additionally, RGGI will hold a stakeholders meeting on May 2 in Hartford Connecticut , where interested parties can comment on the rule.
RGGI requires participating states to cut carbon dioxide and other greenhouse gas emissions every year beginning in 2009, reducing them by a total of 10 percent by 2019. Under the proposed rule, each state would set pollution allowances for its businesses and charge them fees for a minimum of 25 percent of each company's allowance. Companies that exceed their allowances either would have to install new emission control equipment and upgrade their facilities, or purchase a pollution credit from other companies that are below their allowances.
Last December, New Jersey, Connecticut, Delaware, Maine, New Hampshire, New York, and Vermont signed the RGGI memorandum of understanding to reduce greenhouse gases beyond any national limits. The regulations released earlier this month lay out the details of how the program will be implemented.
Electric utilities generally have the highest emissions and will presumably have to spend the most money for their allowances. To meet the more stringent emissions requirements, utilities will have to switch to more expensive natural gas and install costly new equipment. All of these expenses will be passed on to consumers in the form of higher rates. Furthermore, New Jersey utilities will face increased competition as their customers will be able to purchase cheaper energy from Pennsylvania , which has not signed the RGGI agreement.
Finally, even if the RGGI is implemented, it will have no discernable impact on the environment. This is simply a symbolic measure that will increase energy costs without any significant emissions reduction. Contact Sara Bluhm at ext. 204 for more information.
Governor Signs Transportation Trust Fund Extension—New Jersey will be able to continue funding new road construction and repair projects under a Transportation Trust Fund (TTF) financing bill, S-1470 (Lesniak)/A-2813 (Wisniewski), signed into law on March 23. Without this law, all revenues going into the TTF would have been dedicated to paying off old bonds used in past projects, leaving no funding for future road construction projects. The law will allow for new bonds by refinancing the trust fund's existing debt, freeing up about $105 million a year; dedicating all of the existing 10.5-cents-per-gallon gas tax (right now, only 9 cents goes to the fund) for another $78 million per year; and adding another $12 million a year from new toll road revenues. The TTF is the main source of funding for road and public transportation construction. NJBIA supports the measure. For more information, contact Frank Robinson at ext. 225.
Businesses Would Have to Collect Payroll Taxes from Unregistered Contractors under Senate Bill—The Senate on March 20 passed legislation that would require businesses to withhold payroll taxes for the unregistered construction contractors they hire. The bill, S-468 (Sweeney), is awaiting action in the Assembly Labor Committee. If enacted, employers who hire a contractor that is not incorporated in the State would have to collect a tax of 7 percent of the total amount paid and forward it to the NJ Department of Treasury on a monthly basis. Businesses would be responsible for verifying a construction contractor's incorporation and provide a written annual statement to each contractor detailing the total payments made on their behalf. Businesses that fail to withhold the taxes would be subject to the same penalties they would receive if they fail to pay payroll taxes for their own employees.
NJBIA opposes this legislation. The business of collecting these taxes belongs to the NJ Division of Taxation, not the hardworking employers of New Jersey . This bill would impose an inefficient and costly mandate on New Jersey businesses and would unfairly shift the burden of tax compliance onto them. Employers would need to establish costly monitoring and tracking systems to comply and face unfair penalties. For more information, contact Art Maurice at ext. 247.
Meet the Decision Makers Series Starts April 12—When a new Governor is elected, a whole new group of players comes to Trenton . That's why NJBIA is sponsoring four Meet the Decision Makers breakfasts so you can get to know the key members of Governor Jon Corzine's cabinet and staff. Each breakfast will begin with registration at 7:45 a.m. and be held at Forsgate Country Club, Monroe Township , just off of Turnpike exit 8A . The cost to attend each breakfast is $69 per person for NJBIA members and $105 for nonmembers. For more information, contact Stacy Wichner at 609-393-7707, ext. 213. To become a sponsor and receive maximum recognition, contact Sherry Esteves at ext. 219. The events are:
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