TRENTON, N.J. – Two legislative budget officers, Sen. Steve Oroho and Assemblyman Hal Wirths, are asking the governor to open New Jersey car dealerships as the state faces declining sales tax revenue and residents must navigate limited public transportation options. Gov. Phil Murphy’s recent executive order closed all non-essential retail businesses, which included the state’s 510 car dealerships, to stop the spread of the coronavirus.
“While the governor has permitted grocery stores and convenience stores to set up plexiglass dividers and devise social distancing tactics for their customers, he has not afforded the same opportunity to car dealerships,” said Oroho (R-Sussex). “I am confident that our car dealerships can limit interactions with customers who might have expiring leases or been in a car accident and need reliable transportation. Our state would also benefit from the sales tax, one of our biggest sources of revenue.”
The lawmakers suggested that moving car sales online or to an app and then allowing drivers to pick up their purchases on the dealership’s lot, would be one way dealers could still conduct business and abide by social distancing rules.
The effects of the stay-at-home order and shuttering businesses has not been fully realized, but Murphy and the governors from New York, Pennsylvania and Connecticut estimated fighting the coronavirus would cost them $100 billion in lost revenue and increased spending. On Monday, the state treasurer froze nearly $921 million in spending as the state deals with the fiscal consequences of the coronavirus.
“We would be helping New Jersey businesses, residents and the budget if we just reopened car dealerships,” said Wirths (R-Sussex). “Many of the purchases people can make right now are not subject to state sales tax, but vehicles certainly would be and people would have reliable transportation to access food and medical care. New Jersey car dealerships are losing business to other states that are permitted to sell vehicles, including Delaware and Maryland, and online car retailers that deliver purchases to people’s driveways.”
Public transportation has scaled back services amid declining readership and NJ Transit officials are now asking for a $1.25 billion bailout. As personal vehicles are becoming a more reliable source of transportation, more lawmakers are calling on the governor to deem dealers essential businesses. In a news article this week, Senate President Steve Sweeney signaled support for allowing car dealers to operate if they could abide by social distancing protocols.
New Jersey’s new-car dealerships employ 39,000 people full-time. According to the New Jersey Coalition of Automobile retailers, over 26,000 New Jersey drivers will have their leases expire in a given month.