Momentum Builds For NJ ‘Polluters Pay Act’ As State Budget Deadline Nears

A proposed New Jersey law that would force some of the world’s largest fossil fuel companies to shell out $50 billion over two decades continues to plow ahead in the halls of Trenton.

The “Polluters Pay Act” advanced out of the Assembly Appropriations Committee on Tuesday, setting the bill up for a vote before the full Assembly. The bill is scheduled for a budget committee hearing Wednesday afternoon in the Senate.

If it crosses the finish line, the Polluters Pay Act would penalize companies that have engaged in the trade or business of extracting fossil fuel or refining crude oil since 1995, and have contributed to greenhouse gas emissions. The legislation would generate $2.5 billion annually from an estimated 82 fossil fuel corporations, its sponsors say.

The money would be earmarked for flood protection, stormwater and sewage system upgrades, extreme weather preparation, health care related to climate change, upgrades to the electrical grid and energy-efficiency projects, among other uses.

The proposed law has seen eager support from environmental advocates, who say it’s a fair way to make wealthy corporations pick up costs that New Jersey residents are already paying through rising property taxes, utility bills and insurance premiums.

“Polluters should pay, just like the tobacco industry paid and the opioid industry paid,” urged Amy Goldsmith, the New Jersey state director of Clean Water Action.

“Now it's time for big oil to pay,” Goldsmith said.

Meanwhile, pro-business groups have stiffly panned the bill, arguing that it is unconstitutional and will end up passing the cost along to consumers.

The New Jersey Business & Industry Association (NJBIA) recently provided written testimony to an Assembly committee, saying that the bill would retroactively penalize New Jersey fossil fuel companies $50 billion for legally providing an essential product used by all New Jerseyans.

“There will be higher prices at the pump for gasoline and even higher utility bills,” NJBIA deputy chief government affairs officer Ray Cantor said, adding that the cost of consumer good will also rise due to increased fuel prices.

Republican lawmakers have also criticized the proposal.

“Make no mistake, the Democrats ‘Superfund’ policy – supposedly to punish the evil oil companies for providing a product we all demand – would result in a massive, $2.5 billion yearly increase in energy costs on New Jersey residents,” Sen. Declan O’Scanlon argued at a recent legislative hearing.

“Democrats are essentially saying “Don’t worry! We can charge oil companies $50 billion and they’ll just take the hit to their profits! They won’t simply pass the costs on to us! Trust us!’” he added. “It’s sheer lunacy.”

Despite the opposition, supporters of the Polluters Pay Act continue to push for more action on the bill as the July 1 deadline for New Jersey’s new budget approaches.

“Passage of the Polluters Pay Act is an important step toward ensuring that the corporations responsible for environmental damage help cover the costs of climate resilience and recovery –not New Jersey taxpayers,” said Alixon Collazos-Gill, one of the bill’s primary sponsors in the Assembly.

Last week, 25 state lawmakers signed a letter that urges Assembly Speaker Craig Coughlin and Majority Leader Louis Greenwald to post the Polluters Pay Act for a floor vote before the state budget is finalized.

“The support for this bill continues to grow,” the lawmakers wrote. “More than 70 municipalities and local governing bodies throughout the state have passed resolutions and taken formal action in support of this legislation, recognizing both the urgency of the climate crisis and the need to protect taxpayers from bearing the costs of environmental damage caused by major polluters.”

More than 230 clergy and faith leaders from every county in New Jersey also recently penned a joint letter to state lawmakers, encouraging them to “protect the planet” and pass the proposed law.

“There’s a broad coalition supporting this because everyone knows climate costs are being passed on to all of us – that has to end,” urged Matt Smith, the New Jersey director of Food & Water Watch.

“We have the votes,” Smith said Tuesday. “We just need legislative leadership to post the bill.”

It remains to be seen if the race to beat the state budget will end with a win for supporters of the Polluters Pay Act, however.

Gov. Mikie Sherrill and Democratic leaders in the Senate and Assembly announced Tuesday that they have reached an agreement on the $60.7 billion spending plan for fiscal year 2027, which includes an expanded child tax credit, continues to fully fund pensions, increases the budget surplus and contains “the most property tax relief in the state’s history.”

• Related: Sherrill Looks To End Crisis: 5 Takeaways From NJ Budget Address
• Related: Major Property Tax Rebate May Be Restored In New NJ Budget
• Related: 3 Tax Proposals In New Jersey To Know About As Budget Season Heats Up

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