January 7, 2009
New Jersey League of Municipalities Contacts Congress
For Direct Economic Stimulus Funding
With the soon-to-be inaugurated Obama Administration and Congress hard at work on the specifics of a new economic stimulus plan, New Jersey municipalities are making their needs known.
In response to a request from the League of Municipalities, local governments all around New Jersey have competed a survey specifying local infrastructure programs that could begin, with the requisite funding, over the next six months. To date, over 80 municipalities have listed locally needed projects, the cost of which would total over $500 million.
Yesterday, the League forwarded the list to Senators Lautenberg and Menendez and to the rest of our entire Congressional Delegation, asking them to do all that they can to secure direct funding for these investments.
“Recognizing the effects the downturn in the economy is having on our municipalities,” said League President, Mayor Tim McDonough of Hope Township, “it is appropriate for Congress to enact a stimulus package to assist municipal governments and their citizens in their efforts to stabilize our communities. Our nation’s infrastructure, including transportation, water and sewer, and communications, is the backbone of the U.S. economy. To the extent that is properly maintained and adequate to our needs, America’s infrastructure will ensure the long-term vitality of our local, state and national economies, while strengthening the nation’s competitive position in world trade.”
Public infrastructure investment not only creates jobs but generates a healthy multiplier effect throughout the economy by creating demand for materials and services. The U.S. Department of Transportation estimates that for every $1 billion invested in federal highways, more than $6.2 billion in economic activity would be generated. Mark Zandi, chief economist at Moody’s Economy.com, estimates that every dollar of increased infrastructure spending would generate a $1.59 increase in GDP. By comparison, a combination of tax cuts and tax rebates is estimated to produce only 67 cents in demand for every dollar of lower taxes. Thus, by Zandi’s conservative estimates, $150 billion in infrastructure spending would generate a nearly $240 billion increase (or close to a 2 percent increase) in GDP in the first year. In addition to short–term infusions, infrastructure also has long-term effects brought out over a number of years. It increases America’s competitiveness by providing the necessary components for business development and job creation for years to come.
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For further information contact: William G. Dressel, Jr., Executive Director at (609)695-3481, extension 122 or 609-915-9072.