New Jersey Transportation Trust Fund Authority

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Frequently Asked
Questions

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Long-Term Financing Capacity

GARVEE Bonds

NJDOT/NJ TRANSIT
Capital Program

The Transportation Trust Fund provides funding for New Jersey's transportation system

Frequently Asked Questions

Q. What is the current financing capacity of the Transportation Trust Fund Authority? What are its sources of funding?
A. The 2024 Reauthorization amended the Authority's existing bonding authorization to $15.6 billion through FY 2029. Constitutionally dedicated revenues include the Motor Fuels Tax, the Petroleum Products Gross Receipts Tax, and a portion (no less than $200 million) of the Sales and Use Tax. The Constitution does not specifically direct these revenues to the Authority, but rather for the purposes of paying or financing transportation system costs. Statutorily dedicated revenues include contractual contributions from the State's toll road authorities, "Good Driver" vehicle registration surcharge fees, and heavy truck registration fees. These amounts are subject to annual appropriation by the Legislature. The 2024 Reauthorization also established an additional registration fee on zero emission vehicles effective July 1, 2024, with such revenues being available for transportation projects. Appropriations that exceed the annual amount required for TTFA debt service payments may be used to pay expenses on a “pay-as-you-go” basis.
Q. Has the TTFA recently issued any debt other than traditional state contract debt? A. On October 26, 2016, TTFA issued $2.7 billion in 2016 Series A Federal Highway Reimbursement Revenue Notes (Indirect GARVEEs) which were publicly offered and $.5 billion in 2016 Series B Indirect GARVEEs, which the Series B notes evidenced a term loan made to the Authority. These resources were sufficient to pay project expenses during FY 2017, FY 2018, and part of FY 2019. In July 2018 the Authority refunded $1.3 billion in 2016 Series A Indirect Garvee notes, generating approximately $124 million in NPV savings to the Authority. (see Garvee Bonds section for more information).
Q. What is the difference between the Transportation Trust Fund and the Transportation Trust Fund Authority (TTFA)?
A. The Transportation Trust Fund is the term commonly used to refer to the State’s Transportation Capital Program. The annual Capital Program is described in the project list that is submitted to the Legislature each year by the Commissioner of Transportation on March 1 and is approved in the Appropriation Act by June 30 of each year. The project list is the spending or contract authority that allows the New Jersey Department of Transportation (NJDOT) and New Jersey Transit Corporation to advance capital projects up to a specified limit. The Transportation Trust Fund Authority (TTFA) is an independent agency that actually finances the cash disbursements to contractors as they occur for Transportation Trust Fund projects. The TTFA uses appropriated revenues and bond proceeds to finance the disbursements. The TTFA is a financing agency only with no involvement in the selection of capital projects. Q: What is the Special Transportation Fund and why is it important? A. The Special Transportation Fund is a separate fund maintained by the State Treasurer to which the Authority transfers available funds for deposit. Monies deposited in the Special Transportation Fund may be used to fund payments to be made by or on behalf of the NJDOT for capital projects included in the annual Transportation Capital Program.
Q. Which revenues are dedicated for transportation capital purposes in the State Constitution and which are not?
A. The Motor Fuels Tax, Petroleum Products Gross Receipts Tax and a portion of general Sales and Use Tax are dedicated to transportation purposes by the New Jersey State Constitution. The good driver registration surcharge fee, heavy truck fees and toll road authority contributions are dedicated by statute only.
Q. What is the difference between constitutional dedication and statutory dedication?
A. The Constitutional dedication is binding on the Legislature. However, the statutory dedication is not. The Legislature can use the annual Appropriation Act to override funding references in general statutes.
Q. Do the constitutionally dedicated revenues flow directly for transportation capital purposes or do they still need to be appropriated?
A. All revenues in New Jersey must be appropriated annually by the Legislature, even those dedicated by the State Constitution.
Q. Is it possible for the constitutionally dedicated revenues to be appropriated for a purpose other than the Transportation Trust Fund Authority?
A. Yes, the New Jersey State Constitution only directs that the dedicated revenues be appropriated for the purposes of “paying or financing the cost of planning, acquisition, engineering, construction, reconstruction, repair, and rehabilitation of the transportation system in the State.” There is no reference to the dedicated revenues flowing directly to the Authority.
Q. What is the current gas tax rate?
A. On December 2, 2024, the State Treasurer announced that the PPGRT rate would increase on January 1, 2025 to 34.4 cents per gallon of gasoline and 38.4 cents per gallon of diesel fuel. When combined with the Motor Fuels Tax (fixed at 10.5 cents per gallon of gasoline and 13.5 cents per gallon of diesel fuel), the total tax rate that motorists will pay would be 44.9 cents per gallon of gasoline and 51.9 cents per gallon of diesel fuel. Q. How does the annual spending authority provided by the newly reauthorized TTF program compare to past years? A. The 2024 Reauthorization authorizes a total of $10.367 billion in capital program appropriations for FY 2025 through FY 2029 (five years): $2 billion for FY 2025 $2 billion for FY 2026 $2.060 billion for FY 2027* $2.122 billion for FY 2028* $2.185 billion for FY 2029* *The increases in FY 2027 through FY 2029 ($60 million, $122 million, and $185 million, respectively) are to be allocated at 25% each for: county aid, municipal aid, NJDOT, and NJ Transit. The previous legislation (2016 Reauthorization) authorized a total of $16 billion in capital program appropriations between FY 2017 and FY 2024 (eight years). This amount was later amended to $16.6 billion.
Q. What percentage of the annual Transportation Trust Fund Capital Program is currently being spent on Authority debt service?
A. None. The Transportation Trust Fund Capital Program is a spending authorization for NJDOT/NJ TRANSIT capital projects. There is no line item for Authority debt service in the NJDOT/NJ TRANSIT capital program. Debt service is a function of the Transportation Trust Fund Authority which is separate and distinct from the NJDOT/NJ TRANSIT capital program. Debt service payments are funded through the State's annual capital appropriation to the Authority, not through the TTF Capital Program's spending authorization.
Q. The TTFA reauthorization statute enacted in June, 2012 authorized two types of bonds, namely Transportation System Bonds and Transportation Program Bonds. What is the difference between the two?
A.Transportation System Bonds (referred to as “Prior Bonds” in L. 2012, c. 13) refers to bonds issued pursuant to authorizations previously provided in P.L. 1995, c. 108 and P.L. 2006, c.3, as well as any bonds issued to refund those “prior” bonds. Transportation Program Bonds refers to bonds issued pursuant to the authorization enacted in June 2012 (P.L. 2012, c. 13) and any bonds subsequently issued to refund those particular bonds. The Transportation Program Bonds are issued as “state contract” debt backed by a new contract among the State Treasurer, the Commissioner of Transportation and the Authority. Certain revenues dedicated pursuant to the New Jersey State Constitution, including Article VIII, Section II, paragraph 4, consisting of a portion of an amount equivalent to the revenue derived from (i) the $0.105 per gallon Motor Fuels tax, (ii) the tax imposed on gross receipts from the sale of petroleum products and (iii) the sales tax on the sale of new motor vehicles (the “Constitutionally Dedicated Revenues”), as described in N.J.S.A. 27:1B-20, upon appropriation by the Legislature, will be made available to the Authority for debt service payments on the Transportation Program Bonds pursuant to the state contract for such Transportation Program Bonds. The Transportation System Bonds continue to be secured by the existing contract among the State Treasurer, the Commissioner of Transportation and the Authority. Certain statutorily dedicated NJTTFA revenues as described in N.J.S.A. 27:1B-20 and the Constitutionally Dedicated Revenues, upon appropriation by the Legislature, will be made available to the Authority for debt service payments on the Prior Bonds pursuant to the state contract for the Prior Bonds.
Q. How does the Authority go about selecting capital projects to finance?
A. The Authority has no role in selecting capital projects. NJDOT and NJ TRANSIT select state funded capital projects through development of their respective annual capital programs for legislative approval. Federal aid projects must be budgeted and approved by the three Metropolitan Planning Organizations (MPO's) that cover the state.
Q. What is " pay-as-you-go" and how is that term defined?
A. The 2016 Reauthorization provided a new "pay-as-you-go" funding source with the establishment of the Transportation Trust Fund Subaccount for Capital Reserves, funded from the excess of constitutionally dedicated Petroleum Products Gross Receipts tax revenue not needed to satisfy current year debt service obligations. The Authority''s "pay-as-you-go" component is equal to the appropriation revenue received by the Authority in a given year, adjusted for any lapses, investment income, and Build America Bonds tax credits, less the debt service payments for that same year. The difference represents the current year revenue that is available to pay capital project costs. Bond proceeds are added to "pay-as-you-go" revenue to cover total capital project costs for the year.
Q. Where is the Authority in reference to its current bond cap?
A. The 2024 Reauthorization provides for up to $15.6 billion in bonding capacity from FY 2017 through FY 2029. Upon the latest issuance of the 2024 Series CC Bonds, $8.5 billion of that authorization has been utilized.
Q. What is the maximum maturity of TTFA bonds?
A. 31 years.
Q. When does the current capital program authorization expire?
A. L.2024, c. 7, authorizes a $10.367 billion capital program from July 1, 2024 through June 30, 2029.
Q. When does the Authority expire?
A. Never. All reference to Authority expiration dates were removed from the TTFA statute in the 1995 Legislative Reauthorization.

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