Asbury Park Press

Remember the days when New Jersey's gasoline tax was the second-lowest in the U.S.?

Those days, unfortunately, are long gone. With the 4-cent per gallon increase last year, which came on top of the 23-cent increase in 2016, New Jersey now has the ninth-highest gas tax in the nation. It has nearly tripled in scarcely more than two years, from 14.5 cents per gallon to 41.5 cents. And despite state Treasurer Elizabeth Maher Muoio saying she was "cautiously optimistic" another gas price won't be necessary this fall, skepticism seems in order. An analyst for the Office of Legislative Services said an increase may be needed if fuel consumption does not “substantially increase” in the next few months.

An annual review of New Jersey's gas tax rate is required under a 2016 law that raised the tax to pay for transportation projects across the state. If the gas tax doesn't generate about $2 billion a year for the state’s Transportation Trust Fund, which pays for road repairs and projects to fix our crumbling bridges and mass transit system, an increase is required to make up the deficit. The law will remain in force for another five years.

The consumption of gas in New Jersey has been tamped down largely by two things: more fuel-efficient cars, including electric vehicles and hybrids, and fewer motorists from New York and Pennsylvania, where gas prices are higher, buying their gas in New Jersey. As a consequence, less gas tax revenue has been generated by out-of-state drivers. The more New Jersey raises its tax, the more it will be a factor in dampening revenue.

At one time, the price differential between New Jersey and Pennsylvania and New York was significant enough to entice residents from the latter two states to purchase their gasoline here. No longer. New Jersey's gas tax is only 5 cents lower than New York's. Even another modest tax bump this year could bring us close to parity with New York, exacerbating the problem.

We still have a long way to go to challenge Pennsylvania's highest-in-the-nation, 58-cent gas tax. But the more New Jersey narrows the gap with Pennsylvania, the less gas it will be selling to its residents — increasing the need for higher gas taxes here. And so the cycle goes.

Perhaps some solace can be found in the relatively affordable gasoline prices in New Jersey, which adjusted for inflation, are lower than have been in most of the past 100 years. But with the latest spike in prices — they averaged $2.69 a gallon in New Jersey on Thursday, 25 cents higher than a month ago — the distant past doesn't much matter. Our gas tax hike in 2016 was preceded by the lowest retail prices in nearly a decade. The timing of that hike was no coincidence.

A decision on whether the gasoline tax has generated sufficient revenue during the past year to ward off another gas tax hike will be made in August. Only one thing is for certain: New Jersey's last vestige of a relatively low tax is forever gone.