LEGISLATIVE FISCAL ESTIMATE

SENATE, No. 4514

STATE OF NEW JERSEY

222nd LEGISLATURE

 

DATED: JULY 1, 2026

 

 

SUMMARY

 

Synopsis:

Concerns certain motor vehicle related funding to certain municipalities.

Type of Impact:

Potential annual revenue increase for City of Jersey City; potential annual revenue shifts for City of Jersey City.

Agencies Affected:

City of Jersey City

 

 

Office of Legislative Services Estimate

Annual Fiscal Impact

 

 

Potential Local Revenue Increase

Less than $10 million

 

Potential Local Shifts in Use of Revenues

Indeterminate

 

 

·         The Office of Legislative Services (OLS) concludes that the bill may result in an annual revenue increase of less than $10 million for the City of Jersey City associated with the authority to impose, by ordinance, a tax of up to five percent on the rental of motor vehicles occurring within the municipality. 

·         The bill is also expected to result in shifts in the use of certain municipal revenues within the City of Jersey City including collections of the mass transit access parking tax and parking penalties.

 

 

BILL DESCRIPTION

 

     The bill modifies the municipal distribution requirements and rates for certain motor vehicle related funding.  The provisions of the bill only apply to a municipality with a population of 200,000 or greater that experienced a population increase of more than 15 percent between the 2010 and 2020 decennial censuses.  The OLS has identified the only qualifying municipality to be the City of Jersey City.

     The bill amends current law to permit the City of Jersey City to collect a municipality-wide rental car tax regardless of the presence of a major airport.  Currently this tax may only be imposed on rental transactions that occur within a designated industrial zone in a municipality with a population of over 100,000 where a major airport is located.

     The bill also amends the mass transit access parking tax by permitting the City of Jersey City to use these revenues for operating and administrative expenses related to the facilitation of mass transit.  The bill also amends the Parking Offenses Adjudication Act.  Currently, $2 of each parking penalty assessed, when a failure to appear notice has been issued, is distributed to the municipal court.  This bill changes this $2 amount to an allocation of 10 percent of each penalty. 

 

 

FISCAL ANALYSIS

 

EXECUTIVE BRANCH

 

      None received.

 

OFFICE OF LEGISLATIVE SERVICES

 

      The OLS concludes that the bill may result in an annual increase in revenue to the City of Jersey City associated with the authority to impose, by ordinance, a tax of up to five percent on the rental of motor vehicles occurring within the municipality.  The OLS is unable to estimate the number of motor vehicle rental transactions that occur in the City of Jersey City and the terms of such transactions, and is, therefore, unable to estimate the increase in revenue the city may experience as a result of adopting an ordinance imposing a municipality-wide tax on the rental of motor vehicles.  However, the OLS notes that the City of Newark collected $10 million in taxes on the rental of motor vehicles in 2024.  Newark’s collection of this tax is expected to be greater than Jersey City’s due to the presence of Newark Liberty International Airport.

      The bill is also expected to result in shifts in the use of certain municipal revenues within the City of Jersey City including collections of the mass transit access parking tax and parking penalties.  The bill increases the amount of a parking penalty for which a failure to appear notice was issued that is to be designated to the municipal court for the costs incurred in administering the Parking Offenses Adjudication Act.  Current law provides that $2.00 of such penalty is to be designated for the court.  The bill proposes to increase this amount to ten percent of the penalty assessed, as applied to Jersey City.  The minimum penalty for a standard parking violation in the City of Jersey City is $35.00.  At a minimum, the designation of an applicable individual penalty would be $3.50.  While Jersey City collected a total of $2.45 million in parking violation fees in 2024, the OLS is unable to determine the number of violations for which a failure to appear notice was issued, and therefore, for which a portion of the penalty was designated for the municipal court.  Because of this, the OLS is unable to estimate the extent of the revenue shift pursuant to this provision.  The bill also permits the City of Jersey City to shift its use of mass transit access parking tax collections from capital improvements of mass transit facilities, with excess amounts for quality of life projects within the municipality, to operating and administrative expenses related to the facilitation of mass transit.  The City of Jersey City collected $10.09 million in mass transit access parking tax in 2024.

Section:

Local Government

Analyst:

Abigail Stoyer

Senior Fiscal Analyst

Approved:

Thomas Koenig

Legislative Budget and Finance Officer

 

This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.

 

This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).