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March 4-10
Gas Tax
This week an Assembly panel has reported favorably on a bill that will raise the gas tax in New Jersey. A similar bill has been introduced in the Senate. The bill will also significantly increase the cost of registration for zero-emission vehicles. If those actions seem at odds, it’s because the motivation for the bill has little to do with fighting climate change and everything to do with feeding the Transportation Trust Fund, the source of funding for the construction and repair of the state’s transportation system.
It was only a matter of time before the state’s push toward electric vehicles was going to hinder the accumulation of revenue from the gas tax. Solution – raise the gas tax on those carbon emission vehicles. Now how do you get electric vehicle owners to pay for the transportation system? Join with other states and impose an EV registration fee. This bill does that, establishing an EV registration fee of $250 with an automatic increase by $10 per year until it reaches $290. The change in the zero-emission car registration fee would take effect July 1.
The bill raises the gas tax revenue target of $2 billion by $366 million, an 18% increase, over five years. The Treasury Department then sets the tax at a rate that reaches the statutory revenue target. The first increase would hit Jan. 1, 2025. The estimate is that the tax would rise by roughly 10 cents a gallon over the five-year period.
Construction labor unions support the bill. Environmentalists oppose the high registration fee for EVs because it will make electric cars more expensive and potentially hurt sales. Critics say a hike in the gas tax isn’t necessary at this time. Advocates say the bill establishes a way for EV owners to pay for the transportation infrastructure they use.
Get ready for more surprises as the state’s push toward a zero-emissions transportation structure requires all kinds of adjustments to the structure of taxes and fees.
Power Shortages
If you thought the problem of having access to sufficient electric power was one that was still a few years in the future, think again. The electrification strategy that would see zero-emission vehicles dominate the road ways and heat pumps replace home heating from fossil fuels will no doubt put enormous pressure on electric generation and transmission operations. Add to that the need to have electric generation increase its reliance on renewable energy sources and the challenge to meet rising electric power demand in the future seems daunting. But the future may be now.
The tremendous rise in electric power use by data centers focused on cryptocurrencies and artificial intelligence usage is already putting significant strains on the country’s electric power system.
One year ago, a McKinsey study projected that data center power consumption in the U.S. would grow by 10% per year through 2030. Data centers are large scale users of electric power. Again according to McKinsey, a hyperscale data center, defined as something with 5,000 or more servers and 10,000 or more square feet, can use as much electricity as 89,000 households.
Soaring demand for electricity is delaying plans to retire coal plants in several states.
The problem is compounded by the power demands of new technologies like the expanded use of AI or the mining of cryptocurrencies. The U.S. Energy Department tried to make crypto mining concerns report their energy use. The attempt failed when a Texas judge issued a temporary restraining order.
This is all showing evidence that the country’s electric grid, which still isn’t green, may not be able to keep up with the demands for electric power regardless of how that power is generated.
In a December 2023 report, Grid Strategies, a private sector energy consulting firm, states flatly, “The U.S. electric grid is not prepared for significant load growth,” which it may be seeing faster than expected.
County Real Estate Values
Prior to the pandemic the aggregated assessed value of Cape May County real property was listed by the county tax board as $50 billion. The aggregate true value, the market value, of the same property was calculated to be $52 billion. As of January 2024, the assessed value climbed to $52.5 billion and the true value to $87 billion. The calculated true value of property in the county rose by $34.5 billion as a result of the soaring demand for county real estate during and following the Covid health emergency. That represents an increase of 66% in just five years (the 2024 numbers are as of Dec. 31, 2023).
This is an enormous increase in property value in a short period of time, one that has brought good and bad with it. One downside is a housing crisis for those no longer able to afford to buy or rent in the county without overburdening the housing cost portion of their total income. Even the four mainland townships, where most of the county’s permanent population lives, have seen significant increases in property values.
The drama has been on the island communities. The majority of the island communities have seen a 60% or better increase in true value of property since 2019. For some the increase has been mind boggling. On Seven Mile Island the two communities of Avalon and Stone Harbor saw true value of property move from a combined $14 billion in 2019 to $24.4 billion in 2024, a rise of over $10 billion in value in five years, or over 71%.
Happenings
New Jersey Fish and Wildlife proposed a new rule that gives the state Department of Environmental Protection power to limit coastal access for endangered species, sparking opposition from Avalon over potential impacts on community beach plans and public access rights.
A 71-year-old Woodbine man was arrested for possessing child pornography after a tip-off from the National Center for Missing and Exploited Children. Authorities seized six computers from his home and he faces third-degree charges.
Two New Jersey state agencies now agree that cannabis cultivation is allowed on preserved farmland, following initial disagreement. Concerns over environmental impact and community character arise amid plans to grow cannabis on Rea Farm.
The Herald sought further details on the discussions about the Five Mile Dune Project. The exchanges revealed updates on project progress, acquisition of real estate easements, and considerations regarding bulkheads and interim projects.
Mayor Christopher Leusner delivered Middle Township’s State of the Township address, focusing on financial health, growth, and public safety initiatives, with Police Chief Jennifer Pooler highlighting community policing efforts.
Lower Township presented a $34.6 million budget with a slight tax rate decrease, using a surplus of over $9.7 million to maintain financial stability.
Stone Harbor Borough Engineer Marc DeBlasio proposed investing in new playground equipment and safety surfaces for 97th Street playground ahead of potential county grant approval, targeting completion by summer 2024 with a $600,000 expense.
Cape May City has established a task force to navigate changes in affordable housing laws and prepare for upcoming obligations under Mount Laurel round four in 2025.
Ocean City School Board discussed the Freedom to Read Act, which aims to set guidelines for evaluating book challenges in libraries. Board member Catherine Panico warned against the legislation, arguing it infringes on parental rights.
Citizen groups are appealing New Jersey’s decision to award offshore wind contracts, citing secrecy and lack of public involvement. They express concerns about potential economic and environmental damage, warning of increased costs for residents.
West Wildwood’s 2024 budget, introduced March 1, maintains the current tax rate with a surplus of $1.02 million. The sewer utility budget will see a slight increase but won’t affect the sewer rate. The borough is due for a revaluation in 2026.
Cape May County’s 2024 budget trims spending post-nursing home privatization, with a 2-cent tax rate decrease offset by increased ratables, expecting an extra $4 million in taxes. The $214.5 million budget boosts surplus by $5 million, reduces salaries, and emphasizes $17.7 million for bridge and infrastructure improvements.
Surviving a life-altering accident, William Shelton Marsden found his calling as the new senior pastor of Seashore Community Church of the Nazarene, prioritizing evangelism and compassionate ministries.
Cape May County is expanding parking at the Park & Zoo, despite objections about clearing 13 acres of forest. The project, set to finish by June 2025, includes new parking spaces, driveway access, and upgrades to existing facilities.
Spout Off of the Week
Court House – After reading the article on the front page of the Herald ” The Deadly Drug Trend ” I was actually surprised by the way these drugs are categorized, cocaine is a party drug, and ecstasy and mollys are recreational drugs? I have been to a few parties around this area and I have never seen cocaine among the deli trays and finger food. I also enjoy recreational activities and never once been offered ecstasy. Just a thought but maybe instead of us all stocking up on narcan we should start teaching people that these drugs can kill you and if you choose to do these drugs it’s a really bad idea.
Read more spouts at spoutoff.capemaycountyherald.com.
