TRENTON — Towns can't buy cars using proceeds from bonds because they'd still be costing taxpayers money when obsolete. But the Legislature is looking to make an exception for electric or other alternative fuel vehicles, so they can move toward clean energy despite the property tax cap on their spending.

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Assemblyman John McKeon, D-Essex, said some vehicles can be borrowed for in a capital budget and repaid over 20 years, such as fire trucks. But that can’t be done for regular municipal vehicles, including police cars, said he said is an impediment to moving to a greener vehicle fleet.

“And what I’ve heard recently, and we all know this, is it’s even more acute now with the financial crisis that’s come from COVID, as having budgets be that more tight,” McKeon said.

“This will be a way, and it’s obviously permissive, that if the governing body determines that in order to seek the environmental impact and setting an example by a municipal fleet, that will be cars that are not just fuel-efficient but electric, that they’ll be allowed to borrow those as opposed to have to pay for them up front,” he said.

McKeon said that as a former mayor of West Orange, he has long felt that police cars should be funded through the capital budget, not the operating budget.

Assemblyman James Kennedy, D-Union, a former Rahway mayor, said the change would be beneficial.

“I think that primarily in the police department, where the largest fleets seem to be, that this might make a major difference,” Kennedy said.

When a version of the plan, A2208, moved through the Assembly environment committee in January, it enjoyed some bipartisan support.

“I’m very supportive of this, only because it gives the municipalities another tool in their arsenal that’s not a mandate,” said Assemblyman Gerry Scharfenberger, R-Monmouth. “The more options I think municipalities have, the better.”

A version of the plan that passed the full Senate last week in a 25-12 vote had support from one Republican, Sen. Sam Thompson of Old Bridge, while a dozen were opposed.

Among those voting against it was Scharfenberger’s district-mate, Sen. Declan O’Scanlon, R-Monmouth, who said that was “due to the fact that we don’t exempt lighter passenger vehicles, and I’m not sure they’re going to last as long as the five-year bond window.”

The Assembly bill applies to passenger cars and station wagons solely fueled by a battery or equivalent energy storage device charged from an electricity supply external to the vehicle or by a renewable power source.

The bill that passed the Senate is more expansive, allowing borrowing to pay for any vehicle not solely propelled by gasoline or diesel fuel – covering electric vehicles, plug-in hybrid vehicles, hydrogen fuel cell vehicles, natural gas vehicles and propane vehicles.

The Sierra Club opposed the more expansive version of the plan, which now awaits a hearing in the Assembly State and Local Government Committee.

“While it is important to help counties and municipalities move forward with purchasing electric vehicles, we shouldn’t be encouraging more dirty vehicles,” said Jeff Tittel, director of the New Jersey Sierra Club. “This legislation needs to be amended to remove any vehicles that are not truly clean.”

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Michael Egenton, executive vice president of government relations for the New Jersey Chamber of Commerce, spoke in favor of the Assembly bill, noting he is a member of the state Clean Air Council. He said it is good when the public and private sectors are moving in tandem.

“The private sector is, whether it’s fleet vehicle purchase or installing the infrastructure for electric and hybrid vehicles that state and local government follow as well – walk the walk, talk the talk, as they say,” Egenton said.

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