From the DNU today. Absolutely absurd. Politics never ceases to amazing/disgust me.


This is the memo in part-



New Jersey bill proposes tax hike for United only

On Thursday, New York/New Jersey President Jill Kaplan testified at the New Jersey Senate Transportation Committee hearing on proposed legislation that would raise jet fuel taxes for United and our regional partners.

If enacted, the law would require us to pay 4 cents per every gallon of fuel purchased in New Jersey, resulting in an additional $20 million annual cost increase to United. The tax hike would only apply to United and not to any other airlines that fly out of EWR or other small airports in New Jersey.

As home to one of our biggest hubs, Newark and its surrounding communities are important to us because they are where many of our customers and employees live. United has made over $2 billion in unsubsidized investments at EWR since 2000, and just this past July, we announced two new community partnership grants totaling $1 million for the cities of Newark and Elizabeth. We are also one of the state’s top 10 employers and have supported a multitude of local community organizations through the years.

Isn't that something that UA can actually take the State of New Jersey to court for, even as far as going to the State Supreme Court or even go federal??

The fact they don’t quote the actual bill language tells me this is less clear cut. I’m guessing it doesn’t say “United pays more”. If it says “airlines with hubs of more than 200 departures” then it de facto says United. Otoh, if it says “airlines flying aircraft of more than xxx lbs” and United is the only airline presently flying those types of planes I’m fine with it. Similarly if this is because United is bypassing fuel taxes by trucking fuel from New York or elsewhere, and they have banned that effectively raising only United’s cost, I’m fine with that too. The devil is in the details and the lack of detail is suspicious.

Also is this raising United’s tax burden to be more than other airlines per gallon or were they paying less than everybody before. That also isn’t mentioned.

enilria wrote:

Also is this raising United’s tax burden to be more than other airlines per gallon or were they paying less than everybody before. That also isn’t mentioned.

Good point. UA is probably living with some NJ tax breaks at the moment, given their employment status in the state.

enilria wrote:

Also is this raising United’s tax burden to be more than other airlines per gallon or were they paying less than everybody before. That also isn’t mentioned.

It looks like the bill in question is this one:
https://www.njleg.state.nj.us/2018/Bill ... 892_I1.HTM

And it eliminates a tax break on jet fuel, but only eliminates that break for United and its regional partners.

This seems to be the bill: https://legiscan.com/NJ/text/S2892/id/1817803

Apparently airlines currently only pay tax on the amount of fuel burned when taxiing and taking off. This bill leaves the taxes as is for all airlines EXCEPT those who have over 8 million passengers boarded in NJ annually and any regional under contract with such airline -- i.e. United and its regionals. Unlike other airlines, United and its regionals will have to pay the tax on all fuel purchased in NJ.

The purpose of the legislation seems to be raising revenue for a PATH extension to EWR. Because no rationale is provided in the bill for only taxing United an obvious question is: Why not tax all airlines equally?

Seems unfair and unwise.

enilria wrote:

Also is this raising United’s tax burden to be more than other airlines per gallon or were they paying less than everybody before. That also isn’t mentioned.

Several articles have made it clear New Jersey law only taxes the fuel burned during taxi and takeoff while over New Jersey airspace. United is not getting any tax breaks on jet fuel they are just following the current law.
I can understand how the New Jersey senate which needs money to pay for certain project looks at this and states UA is flying a lot of long haul domestic and international flights from EWR and yet UA and ALL airlines are only paying for fuel during taxi and takeoff while over their (New Jersey) airspace. Right now New Jersey is not making a lot of money off any airlines fuel purchased at EWR with this law on the books. That being said New Jersey's senate needs to do the right thing and if they pass this law it should apply to ALL airlines not just UA. In my opinion that is what make this unfair is this proposal targets airlines that carry over 8 million passengers UA is the only carrier at EWR that fits this bill with over 28 million passenger per year.
UA shouldn't have to carry this burden alone. The New Jersey senate is betting UA will not make cuts at EWR in favor of IAD or any other hub. However, the fact that they are only targeting carriers who carry over 8 million passenger a year tells you they know if they did apply this tax across the board in a fair way, many if not all airlines would rethink their EWR strategy going forward and may cut or leave EWR in favor of other airports in the Northeast Mid Atlantic region. The only reason UA is being singled out is New Jersey doesn't want to loose any of the other air carriers that serve EWR.

Apply the tax across the board because EWR is attracting more and more International carriers and domestic carriers or don't apply it at all. Don't assume UA doesn't have options.

Reality is UA won't absorb these taxes, they'll just bump up their fares to cover the additional expense,
so UA's customer base will get soaked in the end.

[photoid][/photoid]How in the world is an Airline to track how much fuel is burned while over NJ Airspace. I would love to see the routing and how is it enforced. A perfect example of ridiculous Government regulation. The amount of people needed to calculate all this gives me a headache. By routing I mean do Airlines avoid NJ airspace to avoid the tax? Does NJ go on Flight Radar 24 and see if anyone is cheating?

Not to mention if you get a hold at Robbinsville or Woodstown.

Sooner787 wrote:

Reality is UA won't absorb these taxes, they'll just bump up their fares to cover the additional expense,
so UA's customer base will get soaked in the end.

Which is the reality with all extra taxes and expenses to corporations in every industry. They get passed through to the customer.
Sadly, my home state never ceases to find ways to make this place more expensive to live. Stops before getting political.

jayunited wrote:

The New Jersey senate is betting UA will not make cuts at EWR in favor of IAD or any other hub. However, the fact that they are only targeting carriers who carry over 8 million passenger a year tells you they know if they did apply this tax across the board in a fair way, many if not all airlines would rethink their EWR strategy going forward and may cut or leave EWR in favor of other airports in the Northeast Mid Atlantic region. The only reason UA is being singled out is New Jersey doesn't want to loose any of the other air carriers that serve EWR.

Politicians are betting UA won't materially de-hub EWR. That's a safe bet. UA needs to serve the biggest market in the country and they won't be doing it from LGA or JFK in any big way. Keeping a tax break for smaller carriers provides competition to UA and helps keep pricing honest. That is clearly good for the public at large.

MIflyer12 wrote:

jayunited wrote:

The New Jersey senate is betting UA will not make cuts at EWR in favor of IAD or any other hub. However, the fact that they are only targeting carriers who carry over 8 million passenger a year tells you they know if they did apply this tax across the board in a fair way, many if not all airlines would rethink their EWR strategy going forward and may cut or leave EWR in favor of other airports in the Northeast Mid Atlantic region. The only reason UA is being singled out is New Jersey doesn't want to loose any of the other air carriers that serve EWR.

Politicians are betting UA won't materially de-hub EWR. That's a safe bet. UA needs to serve the biggest market in the country and they won't be doing it from LGA or JFK in any big way. Keeping a tax break for smaller carriers provides competition to UA and helps keep pricing honest. That is clearly good for the public at large.

In other words, they are betting on United being a cornered cash cow.
There are also very few "smaller carriers". Sure, there are carriers who operate fewer flights than United, but since the US3 are more or less equal in size right now, I don't see how giving a tax break to Delta helps the little guy, or the public at large. Alaska certainly isn't about to open a hub in EWR because of this move, and nor is JetBlue. This isn't going to "keep pricing honest", it's going to lead to increased prices in a market in which United is already dominant.

It's a cynical move on the part of the State of New Jersey, and one which is essentially a nonsensical punishment for an airline which not only provides jobs in NJ, but already contributes significantly to the state budget by virtue of the size of the operation at EWR.

MIflyer12 wrote:

jayunited wrote:

Politicians are betting UA won't materially de-hub EWR. That's a safe bet. UA needs to serve the biggest market in the country and they won't be doing it from LGA or JFK in any big way.

True, but what they could do is rightsize EWR to concentrate more connecting traffic through alternate hubs, especially IAD.

LTU932 wrote:

Isn't that something that UA can actually take the State of New Jersey to court for, even as far as going to the State Supreme Court or even go federal??

I would think that the 14th Amendment of the US Constitution would apply.

Depending upon how its written, it could be interpreted as a Bill of Attainder which would be unconstitutional. But again, as stated quite correctly above, the devil is in the details. I'm sure United's lawyers are now and have been going over this legislation with a fine toothed comb.

MIflyer12 wrote:

jayunited wrote:

The New Jersey senate is betting UA will not make cuts at EWR in favor of IAD or any other hub. However, the fact that they are only targeting carriers who carry over 8 million passenger a year tells you they know if they did apply this tax across the board in a fair way, many if not all airlines would rethink their EWR strategy going forward and may cut or leave EWR in favor of other airports in the Northeast Mid Atlantic region. The only reason UA is being singled out is New Jersey doesn't want to loose any of the other air carriers that serve EWR.

Politicians are betting UA won't materially de-hub EWR. That's a safe bet. UA needs to serve the biggest market in the country and they won't be doing it from LGA or JFK in any big way. Keeping a tax break for smaller carriers provides competition to UA and helps keep pricing honest. That is clearly good for the public at large.

Good for the public at large? Or good for airlines that aren’t United? Clearly it’s the latter. Not sure how that benefits the public.

And if people think this is good law I hope to see United cut some non-core jobs in New Jersey just to show how this kind of law gets sideways.

Sooner787 wrote:

Reality is UA won't absorb these taxes, they'll just bump up their fares to cover the additional expense,
so UA's customer base will get soaked in the end.

No, the real reality is that UA has to match a competitors fare. When the price sensitive customer pulls up fare online, which do they generally choose? Not the one a couple dollars more because of NJ fuel taxes. I agree that they will where they can, but it won't be across the board as you suggest.

MIflyer12 wrote:

Politicians are betting UA won't materially de-hub EWR. That's a safe bet. UA needs to serve the biggest market in the country and they won't be doing it from LGA or JFK in any big way. Keeping a tax break for smaller carriers provides competition to UA and helps keep pricing honest. That is clearly good for the public at large.

I never used the words de-hub I stated United does have options at IAD. EWR will always be a hub but it could be downsized. And this proposed tax provides no incentive for any other airline to grow because if they exceed 8 million passengers in a calendar year the tax would then be applied to them. So why grow or invest in EWR when you know you will be penalized the moment your cross the threshold of 8 million. You might think this is good for New Jersey and EWR but if this law is passed it will be an anchor around EWR's neck which is why they are not applying this tax fairly across the board.
Take for example SQ is going to relaunch EWR-SIN, how much fuel are they buying in EWR for the return flight and yet they are only paying taxes (like UA) on fuel used on taxi and takeoff while in New Jersey airspace. If this tax were applied across the board would SQ rethink their plans for EWR because their cost would grow, how about EK EWR-DXB, AI, EWR-BOM, CX, EWR-HKG there are a lot of international and domestic carriers that are buying fuel at EWR. Why leave all that money on the table and say UA you're the only airline that has to pay this tax. Is it because they are worried if applied across the board every airline at EWR will immediately rethink their strategy at EWR and the airport overall would suffer.

And while you are saying its fair I wonder will the tax rate be locked in for 10, 15, or 20 years? Would the tax be removed once the PATH train extension is complete? Or will the New Jersey senate find something else to do with the money collected at the PATH train is complete? Would the senate be able to come back during their next fiscal year and say we need to raise the fuel tax but again only on airlines in the 8 million plus range? I live in Illinois one of the most corrupt states in the Union, I don't think New Jersey is to far behind us in the corruption category. Here in Illinois these types of taxes never stay the same they always rise year after year after year because the legislators assume people can afford it and the real kicker is these taxes don't go away even after the project is complete our corrupt politicians keep taking the money and spending it on other things. If this proposed tax isn't locked in and the senate can raise it whenever they choose and if there is no language in the law that ends this tax after the completion of the PATH train the senate will continue to collect the tax and use it for things not related to EWR improvements at all. If not applied across the board this proposal is bad for business and even if it is applied across the board its still bad for business. There has to be another way to fund this PATH train extension.

UA should know by now the Port Authority of New York and New Jersey (the black hole to where this new money will be funneled) is the most corrupt, vile organization in the U S. - after all, United already lost a CEO on account of that. They only solution for the PANYNJ would be to sit it down immediately, arrest everyone and only let them go if they proved they are innocent, but I am afraid that would run afoul of the Constitution, so I would be happy if they just shut it down.

There are alot of ways to punish nj. Cut the pilot and fa and mx bases from nj. Base them in either ny or another hub And have fly though or w routing. That pulls several thousand from the states injury and unemployment insurance funds. Tanker fuel as well

[photoid][/photoid]

Blockplus wrote:

There are alot of ways to punish nj. Cut the pilot and fa and mx bases from nj. Base them in either ny or another hub And have fly though or w routing. That pulls several thousand from the states injury and unemployment insurance funds. Tanker fuel as well

That would be hugely expensive and a disaster waiting to happen. By basing a bunch of pilots and FA's in another locale and then deadheading them into base you're removing seats for sale from inventory and/or having to displace passengers booked. Because a crew member's duty day starts when they arrive for work (including any deadhead segments) by stationing these folks elsewhere means you are cutting into the time that you can use and schedule them. Having maintenance done at a hub means you aren't having to ferry an empty plane to/from a remote maintenance base to get many things fixed.

enilria wrote:

Also is this raising United’s tax burden to be more than other airlines per gallon or were they paying less than everybody before. That also isn’t mentioned.

Not quite. EWR, although a hub for United, represents a small notch out of the entirety of their daily operations world wide. I personally think its a good idea. With all the ancillary revenue UA makes for charging for everything except the kitchen sink and not having to pay taxes on those items, this is a great way for the state to get their hands on some of that money, Besides, I am sure SK will come up with some creative way to pass that .04 cents on to the passenger.

Lol, UA is not going to punish NJ if something like this passes. They are not going to kill the golden goose. If they try anything like that, I'm sure NJ can pull some string behind the scene to make more gates at EWR available for other airlines. I'm sure B6 and WN would gladly have access more gates.

I do expect tanker fuel to go up. It’s a simple computer program to calculate how much fuel costs at one station vs the cost of carrying it in. This will move the needle and EWR will sell less jet fuel. I tanker all the time. It’s a calculation that’s done for every flight. Either way, it’s going to cost UAL more money, but NJ will lose revenue from fuel sales. More than what they gain with the tax? No idea.

This is why people flee from NY and NJ every year.

Tax and spend politics unchecked.

It is so bizzare...to tax your sacred cow. United should be the states darling.

No where else could you find this preverse logic in action

tphuang wrote:

Lol, UA is not going to punish NJ if something like this passes. They are not going to kill the golden goose. If they try anything like that, I'm sure NJ can pull some string behind the scene to make more gates at EWR available for other airlines. I'm sure B6 and WN would gladly have access more gates.

I would agree with you except of the 8 million passenger guillotine. Any airline that exceeds 8 million passenger has to pay the increase tax rate and while other airlines aren't effected by the current language. What would keep any future senate from dropping the level down to 7,6, or 5 million. Once government gets a taste of the increase revenue and if this tax doesn't go away after the completion of the PATH project what is to keep the senate from going after smaller airlines. This law if passed needs to have some real concrete barriers built into it if it doesn't mark my words today is United tomorrow its everyone else because they are not going to want to give up this revenue once they get a taste of it if fact they will want more.

jayunited wrote:

MIflyer12 wrote:

Politicians are betting UA won't materially de-hub EWR. That's a safe bet. UA needs to serve the biggest market in the country and they won't be doing it from LGA or JFK in any big way. Keeping a tax break for smaller carriers provides competition to UA and helps keep pricing honest. That is clearly good for the public at large.

I never used the words de-hub I stated United does have options at IAD. EWR will always be a hub but it could be downsized. And this proposed tax provides no incentive for any other airline to grow because if they exceed 8 million passengers in a calendar year the tax would then be applied to them. So why grow or invest in EWR when you know you will be penalized the moment your cross the threshold of 8 million. You might think this is good for New Jersey and EWR but if this law is passed it will be an anchor around EWR's neck which is why they are not applying this tax fairly across the board.
Take for example SQ is going to relaunch EWR-SIN, how much fuel are they buying in EWR for the return flight and yet they are only paying taxes (like UA) on fuel used on taxi and takeoff while in New Jersey airspace. If this tax were applied across the board would SQ rethink their plans for EWR because their cost would grow, how about EK EWR-DXB, AI, EWR-BOM, CX, EWR-HKG there are a lot of international and domestic carriers that are buying fuel at EWR. Why leave all that money on the table and say UA you're the only airline that has to pay this tax. Is it because they are worried if applied across the board every airline at EWR will immediately rethink their strategy at EWR and the airport overall would suffer.

And while you are saying its fair I wonder will the tax rate be locked in for 10, 15, or 20 years? Would the tax be removed once the PATH train extension is complete? Or will the New Jersey senate find something else to do with the money collected at the PATH train is complete? Would the senate be able to come back during their next fiscal year and say we need to raise the fuel tax but again only on airlines in the 8 million plus range? I live in Illinois one of the most corrupt states in the Union, I don't think New Jersey is to far behind us in the corruption category. Here in Illinois these types of taxes never stay the same they always rise year after year after year because the legislators assume people can afford it and the real kicker is these taxes don't go away even after the project is complete our corrupt politicians keep taking the money and spending it on other things. If this proposed tax isn't locked in and the senate can raise it whenever they choose and if there is no language in the law that ends this tax after the completion of the PATH train the senate will continue to collect the tax and use it for things not related to EWR improvements at all. If not applied across the board this proposal is bad for business and even if it is applied across the board its still bad for business. There has to be another way to fund this PATH train extension.

The problem is IAD isn’t really an option and the corrupt folks in NJ know it. Other than flow traffic IAD does nothing to capture the high yield O&D market in NYC.

It is as was said above a “cornered cash cow”. The truth is IAD will never support the like of DEL, BOM, ATH, TXL, etc etc.

Rather than foster the exceptional nature of the market they are opting to loot it.

tpaewr wrote:

It is as was said above a “cornered cash cow”. The truth is IAD will never support the like of DEL, BOM, ATH, TXL, etc etc.

Are you sure about that? IAD is one of the few markets that probably could.

jayunited wrote:

tphuang wrote:

Lol, UA is not going to punish NJ if something like this passes. They are not going to kill the golden goose. If they try anything like that, I'm sure NJ can pull some string behind the scene to make more gates at EWR available for other airlines. I'm sure B6 and WN would gladly have access more gates.

I would agree with you except of the 8 million passenger guillotine. Any airline that exceeds 8 million passenger has to pay the increase tax rate and while other airlines aren't effected by the current language. What would keep any future senate from dropping the level down to 7,6, or 5 million. Once government gets a taste of the increase revenue and if this tax doesn't go away after the completion of the PATH project what is to keep the senate from going after smaller airlines. This law if passed needs to have some real concrete barriers built into it if it doesn't mark my words today is United tomorrow its everyone else because they are not going to want to give up this revenue once they get a taste of it if fact they will want more.

i totally agree with this. Just a tax grab by NJ gov't, a very broke one to say the least.

neomax wrote:

tpaewr wrote:

It is as was said above a “cornered cash cow”. The truth is IAD will never support the like of DEL, BOM, ATH, TXL, etc etc.

Are you sure about that? IAD is one of the few markets that probably could.

But it doesn’t. Why? 3 letters DCA.

All the premium domestic traffic/feed goes there. If you combined IAD & DCA you would have a powerful hub. But split up IAD will never see the franchise EWR does.

tphuang wrote:

Lol, UA is not going to punish NJ if something like this passes. They are not going to kill the golden goose. If they try anything like that, I'm sure NJ can pull some string behind the scene to make more gates at EWR available for other airlines. I'm sure B6 and WN would gladly have access more gates.

It wouldn’t be hard to find 50-100 people they could let go and staff from somewhere else. The state needs their income tax too and this is where terrible politics come back to bite those states in the butt later.

jfklganyc wrote:

This is why people flee from NY and NJ every year.

Tax and spend politics unchecked.

It is so bizzare...to tax your sacred cow. United should be the states darling.

No where else could you find this preverse logic in action

So so true. I'm currently devising my exit strategy. This time next year, NJ will be in my rear view mirror.
I'm very very small potatoes compared to him, but folks should Google David Tepper and his exit from NJ.

BC77008 wrote:

[photoid][/photoid]

Blockplus wrote:

There are alot of ways to punish nj. Cut the pilot and fa and mx bases from nj. Base them in either ny or another hub And have fly though or w routing. That pulls several thousand from the states injury and unemployment insurance funds. Tanker fuel as well

That would be hugely expensive and a disaster waiting to happen. By basing a bunch of pilots and FA's in another locale and then deadheading them into base you're removing seats for sale from inventory and/or having to displace passengers booked. Because a crew member's duty day starts when they arrive for work (including any deadhead segments) by stationing these folks elsewhere means you are cutting into the time that you can use and schedule them. Having maintenance done at a hub means you aren't having to ferry an empty plane to/from a remote maintenance base to get many things fixed.

Wasnt really saying dead head, but just compound more of what they already do. Like fly from iah to clt to ewr to somwhere else. Or ord- lhr - ewr- - lhr - ord.

If this tax is going to fund PATH extension to EWR, does anyone think it will ever be rolled back once the PATH extension is completed?

Id like to see the PATH extention even started.

It seems the Port as become so inept, that unless an airline or private entity is involved (LGA project involved private entities and a strong willed governor) nothing gets done.

We have been hearing for years about PATH and a Terminal A replacement...and we are still years away from either.

Why is anyone surprised?

Governor Murphy stated he would be raising taxes on the rich... and well... Airlines are "rich."

ltbewr wrote:

First of all the PATH extension idea will still need the shuttle from the terminals to the tracks, the shuttle system is in need of a costly replacement and frequently subject to breakdowns.
You have an existing structure via the shuttle of NJ Transit to Newark Penn Station, NY Penn Station, and on the NE Corridor train line other connections to NJ Transit trains and buses as well as existing bus services from EWR's terminal to key NYC locations.
EWR's fees for airlines are already among the highest of airports in the USA.
Why should the PANYNJ take on the likely $ 1 Billion + costs to build this extension and cost bridge toll payers more to subsidize PATH than they aleardy do with $15+ tolls that hurt businesses that have to use their corssings.
This bill may be illegal, likely to be in conflict with the Constitution may make it dumb to push it.
It also makes the Democrats in NJ look more like the tax and spend party they are already seen as.

Heh?

PATH is PART of Port Authority. If anything, they should get more people to use PATH... it is perhaps the most reliable transportation they have.

The only thing UA could theoretically do is move a lot of connecting traffic down to IAD. There isn't much beyond that they'd do.

Tax rates of the 50s, 60s, and 70s (and even the 80s) were much higher and mark the years the US economy was the wonder of the world in its growth rates. We are still sucking on the infrastructure mostly paid by our grandparents. They weren't called the greatest generation for nothing. We seem to be the 'me first' generation, all of them since those days. Two bit taxes like this are bad public policy, basic income taxes (whether individual or corporate) are how infrastructure was funded.

N62NA wrote:

If this tax is going to fund PATH extension to EWR, does anyone think it will ever be rolled back once the PATH extension is completed?

Nope, once you introduce a tax it rarely gets rolled back.

ltbewr wrote:

This bill may be illegal, likely to be in conflict with the Constitution may make it dumb to push it.

So you think it's likely UA could sue New Jersey for this, based probably on the 14th Amendment if applicable, as aemoreira1981 suggested? Or will they wait until the governor decides if he will veto the bill or not (provided that he has veto rights, I'm not familiar with NJ state law).

What do you expect from a governor who when asked what he was going to do about the high taxes in the state driving people out said "I want to be the governor of the people who stay". As much as I'm not a fan of United especially after their comments on raising fares and fees, this can only hurt NJ why can't they just stop spending so much live within our means.

As someone in the NY area, we have really hit the tipping point in terms of these types of politics.

NY and NJ stand on the doorstep of becoming the next Illinois. NJs day of reckoning is much closer than NY because it is smaller and doesnt have the Wall St engine pumping in billions.

In the year 2018, if you have the highest and second highest Tax burden in the nation; If you have pension obligations that are billions in the rears; If every state employee has a medical plan that they contribute little or nothing to and a fully paid pension That they pay little or nothing to; And the politicians elected are in bed with the unions that represent the employees with said benefits...

You are in serious trouble!

New York still has some time And is a few downturns away from it...But New Jersey and their pension explosion is coming very shortly.

When it comes, it is going to decimate the state because they are totally unprepared for the hard decisions that need to be made. And there is no adults in leadership that will make those decisions

For some of you not in the New York area just a reality check at what some of your middle-class families are paying:

Gas $3.25 gal regular
Tolls $15-20 to cross one of the bridges
Commuter train to city $250-$450 per month
Subway pass once off commuter train $120 per month
Property taxes $10000-$25000 per year
Payroll tax

I don’t have to tell you That all of our roads, trains, tunnels and bridges are old, under capacity, and often in disrepair.

The ridiculously high cost-of-living is often justified on forums like this because people say the wages are higher. But there is a huge swath of middle-class people in the area making $50000-$100,000 a year. You try to reconcile those numbers above with that salary...And you cannot do it!

jfklganyc wrote:

As someone in the NY area, we have really hit the tipping point in terms of these types of politics.

NY and NJ stand on the doorstep of becoming the next Illinois. NJs day of reckoning is much closer than NY because it is smaller and doesnt have the Wall St engine pumping in billions.

In the year 2018, if you have the highest and second highest Tax burden in the nation; If you have pension obligations that are billions in the rears; If every state employee has a medical plan that they contribute little or nothing to and a fully paid pension That they pay little or nothing to; And the politicians elected are in bed with the unions that represent the employees with said benefits...

You are in serious trouble!

New York still has some time And is a few downturns away from it...But New Jersey and their pension explosion is coming very shortly.

When it comes, it is going to decimate the state because they are totally unprepared for the hard decisions that need to be made. And there is no adults in leadership that will make those decisions

For some of you not in the New York area just a reality check at what some of your middle-class families are paying:

Gas $3.25 gal regular
Tolls $15-20 to cross one of the bridges
Commuter train to city $250-$450 per month
Subway pass once off commuter train $120 per month
Property taxes $10000-$25000 per year
Payroll tax

I don’t have to tell you That all of our roads, trains, tunnels and bridges are old, under capacity, and often in disrepair.

The ridiculously high cost-of-living is often justified on forums like this because people say the wages are higher. But there is a huge swath of middle-class people in the area making $50000-$100,000 a year. You try to reconcile those numbers above with that salary...And you cannot do it!

Well done regurgitating the Fox News, Republican talking points. Not based in any real facts, just convenient scape goats (unions).

The pension mess is not the fault of the unions. Those were obligations that were made to those employee groups years ago. The fault lays at the feet of the Federal Government and State Legislatures (primarily Republican administrations--hardly in bed with Labor Unions), which changed the laws to make pension funding more risky (equities vs portfolios investments so that Wall St banks could use more of the underlying principle to invest while retaining less principle capital in safer investments when tied to variations in stock market value--suddenly less money following the 2008 crash), coupled with demographic changes including increase in life expectancy, reduction is current employee workforces, etc. Then when 2008 hit, many of these fund moved to the"safer" bond which has had interest rates are near zero for the last 10 years. Perfect storm.

NJ's other problems is the legacy of having tiny carved out municipalities. No economy of scales benefit when your town has a small police force and school district with overlapping administrations, with neighboring communities etc. Towns, Townships, Boroughs, etc.

As for taxes, the trade off is that NY and NJ have arguably the best public education system in the country. Best mass transit systems (albeit, falling apart and need of repair). Better social safety net, etc. Try living in Florida or Texas as a poor American with terrible schools, no mass transit system, and no public assistance programs.

BTW, it's "in arrears" not "in the rears." I'm not sure that pensions are in arrears; they are underfunded rather than not being paid.

It is not a partisan issue.

There is a huge shortage in funding.

NJ is at a crossroads.

Right, Left, Center...it is a HUGE problem.

Kudos to you, beyond calling me a cable news mouthpiece, for at least acknowledging the problem

Taxing everyone to the point of people fleeing isnt a good option (that part is my partisan opinion)

You cant have legacy payments eating up a larger share of the budget year after year. (that isnt partisan...it is a budget reality!)

Man, the ignorance is strong in here... Public pension funds invest in equities not because anyone is forcing them to, they do so because it is the only way to get anywhere close to the absolutely insane 7.5+% discount rate assumptions they use to mask the size of their ultimate liabilities. Any insurance company that ran itself using the same accounting and funding regime of public pension plans would have long been shut down by regulators, and their executives arrested, but since moving towards realistic assumption-setting would ultimately bankrupt not just the funds themselves but also the states that sponsor them, government officials are more than happy to play ball with the "delay and pray" strategy.