Bill > S4549

Introduced Session

This bill dedicates a portion of the revenues generated from the taxation of energy or utility service under the sales and use tax to the "Universal Service Fund" to support utility assistance programs. Under this bill, if the total revenues collected in any State fiscal year from the taxation of energy or utility services under the sales and use tax exceed those amounts collected in State Fiscal Year (FY) 2025, then the State would be required to appropriate an amount equivalent to the excess revenues collected during that fiscal year to the Board of Public Utilities (BPU) for deposit into the "Universal Service Fund" to support utility assistance programs, including but not limited to the Payment Assistance for Gas and Electric Program. The "Universal Service Fund" is a nonlapsing fund administered by the BPU through which various energy and utility assistance programs are funded, such as the Lifeline Credit Program and the federal "Low Income Housing Energy Assistance Program." Under current law, the revenues collected from the taxation of energy or utility services under the sales and use tax are required to be deposited into two funds: (1) a special dedicated fund for municipal State aid, known as the "Energy Tax Receipts Property Tax Relief Fund;" and (2) the General Fund. The portion of these revenues deposited into the "Energy Tax Receipts Property Tax Relief Fund" is statutorily determined, and the amounts collected in excess of this dedication are deposited into the General Fund. According to the FY 2026 Governor's Budget, the Governor anticipates that the taxation of energy and utility services under the Sales and Use Tax will generate roughly $980 million in total State revenue in FY 2025. The BPU has also announced increases in the electricity rates for residential ratepayers ranging from 17.2 to 20.2 percent, depending on the supplier, to begin this year. In light of these rate increases, sales and use tax collections from energy and utility sales may exceed FY 2025 levels by as much as $85.2 million in FY 2026. Under the bill, these excess collections would be dedicated to the Universal Service Fund.

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Committee Categories

Carmen Amato (R)*, 

Introduced in the Senate, Referred to Senate Economic Growth Committee (on 06/02/2025)

Official Document