New Jersey Keeps Doling Out Huge Tax Breaks To Corporations: NJPP

As many New Jersey residents continue to pinch pennies to make ends meet, the state continues to shell out huge tax breaks to lure companies to its borders, a local advocacy group says.

If the New Jersey Economic Development Authority (NJEDA) approves $51.5 million in new corporate tax breaks during its meeting on Thursday, it will have given out more than $8 billion in special tax breaks since January 2010 under the Economic Opportunity Act, the New Jersey Policy Perspective (NJPP) stated.

According to the nonprofit advocacy group, New Jersey has seen a “subsidy surge” since 2010. This bump in tax breaks is creating a long-term economic drag which may linger for the next 15 years as the backlog of credits are paid out.

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“New Jersey has pledged billions of dollars to a few hundred corporations in a misguided attempt to make the state ‘competitive,’ while largely ignoring the assets - like our public schools, transit systems and research universities - that can actually give New Jersey an edge in today’s global economy,” said Jon Whiten, NJPP vice president.

“Policymakers must take a smarter, more comprehensive approach to economic development, and they must do it soon,” Whiten asserted. “Our state’s future depends on it.”

Some of the corporations that have been approved for recent tax breaks from the NJEDA include:

• JP Morgan Chase - 10-year, $188 million tax break if the company agrees to move more than 2,000 banking jobs from New York to Jersey City
• Pearson Education - $83 million tax break to move 628 employees from Bergen County to Hudson County
• Jaguar-Land Rover North America - $27 million tax break to stay in New Jersey
• Newell Brands - $27 million in tax incentives over a 10-year period to relocate to Hoboken
• Vitaquest International - $29.4 million, 10-year “Grow New Jersey” award to move its manufacturing operations and 110 employees to Paterson
• iCIMS, Inc. - 10-year, $38 million tax credit to relocate to Holmdel's former Bell Labs headquarters
• The Four Corners Millennium Project - $50 million in tax breaks for a development project near Newark’s Broad and Market streets

The concept of reeling in the state’s generous corporate tax incentive programs has gained support from several Republican, Democrat and third-party leaders in New Jersey.

In February, Assemblywoman and Deputy Republican Leader Amy Handlin of Monmouth County introduced a bill that would prematurely end the state's multi-billion-dollar Grow New Jersey and Economic Redevelopment and Growth Grant programs, Politico.com reported.

Democrat governor candidate Phil Murphy - a former Goldman Sachs executive - said that it’s a “myth” that the only thing the government can do to attract and keep companies is to get into a bidding war of tax incentives, the Associated Press stated.

“Tax incentives have a place but paying hundreds of thousands of dollars per job to keep relatively few companies here is outdated and small thinking,’’ Murphy told a reporter last year.

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