skywayclosedFrances.jpg

A continuing overhaul of the Pulaski Skyway is one of billions of dollars in state transportation projects slated for Fiscal 2016, financed by the Transportation Trust Fund through bond proceeds, Port Authority money, cash reserves and repayment of $241.5 million in loans to NJ Transit. (Frances Micklow | The Star-Ledger)

(Frances Micklow/The Star-Ledger)

TRENTON — A portion of the money Gov. Chris Christie's administration is using to eke one more year out of a fading Transportation Trust Fund will be paid by calling in a loan from NJ Transit.

That $241.5 million loan repayment will be patched together with $627 million in bond proceeds, $281 million in cash balances, and $353 million in Port Authority money to fund a total of $1.48 billion in transportation and infrastructure projects in the fiscal year beginning July 1, state Treasurer Andrew Sidamon-Eristoff told the state Senate Budget and Appropriations Committee on Tuesday afternoon.

The trust fund is running out of money for new projects, and lawmakers say they don't expect to have a deal in place to augment the fund through a gas tax hike this year.

The state's plan to "cobble together enough cash" to pay for next year's spending plan won't solve the problem long term, the Legislature's budget and finance officer, David Rosen, told the committee earlier on Tuesday.

Sidaman-Eristoff told the committee chairman, Paul Sarlo (D-Bergen), that NJ Transit receives federal grant money on a different budget cycle than the state's, occasionally leaving the agency short on cash. So, the treasurer said, the TTF has commonly stepped in with short-term loans to smooth out NJ Transit's cash flow problems.

NJ Transit has periodically paid back the money after receiving federal funds, he said, and the agency will make a $241.5 million repayment to the Transportation Trust Fund for the coming fiscal year. And instead of borrowing more cash from the trust fund in fiscal 2016, NJ Transit will get it from private lenders.

"They've been able to secure their an independent letter of credit to handle their cash flow needs instead of having to rely on the TTF. That's efficient for them and it's efficient for us, because we have more flexibility and the TTF has cash," Sidamon-Eristoff said.

Sarlo was skeptical, however, and asked whether the administration was "double counting" the dollars when it was originally loaned to NJ Transit and again upon its repayment.

"You can't count it both ways," Sarlo said after the hearing. "Is it just a number of paper, or is it really an investment in infrastructure?"

Chris Santarelli, a spokesman for the Treasury Department, said that the loan has "never before been counted as TTF funding for transportation project costs."

NJ transit may not be in a position to be shelling out cash. The agency is considering a fare increase and service cuts in the face of an $80 million budget gap.

Christie's budget cuts the system's transportation allocation by 8.4 percent, from $1.4 billion in the fiscal year ending June 30 to $1.3 billion in the fiscal year beginning July 1.

"You could potentially connect those dots that a fare hike is being used to fund TTF," Sarlo said.

NJ Advance Media staff writer Steve Strunsky contributed to this report.

Samantha Marcus may be reached at smarcus@njadvancemedia.com . Follow her on Twitter @samanthamarcus. Find NJ.com Politics on Facebook.