For Immediate Release
Contact: Jeff Tittel, NJ Sierra Club, 609-558-9100
The Senate and Assembly have both passed A4 (Pintor Marin) / S3295 (Ruiz). The “New Jersey Economic Recovery Act of 2020” provides for administration of programs and policies related to jobs, property development, community partnerships, small and early stage businesses, State procurement, and film production. The bill passed the Senate with a vote of 38-1 and the Assembly with a vote of 68-11-0.
“The Legislature just passed one of the biggest corporate giveaways in state history. They rushed through it without transparency or public scrutiny. They’re saying that the subsidies will be capped at $11.5 billion, but with extra incentives for the film industry and other tax breaks the total is really $14.5 billion. They’re spending all of this money while we’re in the middle of an economic downturn. We don’t have money for necessary infrastructure upgrades of coronavirus relief, but they want to give Big Business a massive corporate subsidy,” said Jeff Tittel, Director of the New Jersey Sierra Club “What the Legislature did is shameful. They passed this bill so quickly and threw so much money and different programs into it that it will be a mess just like Christie’s. Governor Murphy needs to CV this bill to make sure that this invests in the people of New Jersey instead of corporations.”
New Jersey’s billion-dollar tax incentive program expired about 18 months ago. Governor Murphy, Senate President Sweeney, and Assembly Speaker Craig Coughlin recently announced that they have reached a deal to restart the program to attract and keep businesses in New Jersey by offering them tax breaks. The amount available for business incentives is $11.5 billion over the next seven years, but the additional tax breaks and incentives bring the total up to $14.5 billion.
“Instead of making developers and corporations richer, we should be investing in our communities and families. Not only will this bill not benefit the average New Jersey family, but all of these subsidies and extra debt will cause cuts to programs that they need. This will take money away from key programs like NJ Transit, fixing water systems, combined sewer overflows, and adaptation to climate change. It could also lead to cuts and raids to funds like the Clean Energy Fund,” said Jeff Tittel. “The world has changed a lot since the pandemic, and many of these projects like shopping malls and office parks might not even be viable. Instead of corporate subsidies, the state should be looking at real solutions to create real jobs. Fixing our infrastructure, investing in NJ Transit, and expanding our offshore wind and solar programs would create real jobs and spur economic growth.”
Some of the subsidies that were given out under the Economic Development Authority’s tax incentive program since 2010 include $650 million to the Xanadu Mall, $81 million to Goya Foods to move 5 miles and create 9 additional jobs, $250 million for Prudential to move a few blocks in Newark, $42 million tax break to Campbell’s soup, $261 million for construction of Revel casino in Atlantic City, $14 million to Bayer Healthcare, $12 million to Intrasphere Technologies, Holtec, Honeywell, Lockheed Martin, and more.
“This is really a giant Pay to Play scheme rather than about rebuilding the economy. This bill is taking care of corporations at the expense of working families and small businesses in New Jersey. They are spending $14.5 billion, but only about $50 million is going to Main Street and small businesses. This is a Christmas gift to big corporations and the wealthy. Meanwhile, it is peanuts for small businesses and coal in our stockings for the rest of us,” said Tittel.“These subsidies have been shown not to create jobs or do much for the economy. The American Dream/Xanadu Mall, which still isn’t completely opened, received $650 million. We gave $81 million to Goya Foods to move 5 miles and create 9 additional jobs, and Prudential got $250 million to move four blocks in Newark.”
The New Jersey Sierra Club opposed the original EDA tax incentive program in 2013 when Chris Christie was governor. In 2018, Governor Murphy ordered an audit on the EDA’s tax incentive programs. The audit found that of the 48 projects and promised 15,000 jobs, 3,000 couldn’t be documented or were double counted.
“They still haven’t fixed the problems from the big giveaways during Christie, and now they’re doubling down on it. There is some transparency and reform in the bill, but they ironically pushed it through without time for proper oversight or public scrutiny. The bill does have some positives, but there wasn’t enough time to fully analyze the bill before it was passed. Some money is going for developing offshore wind ports, brownfields, helping deal with food deserts, and fixing Main Streets. It also has better worker protections than in the past, but there is still plenty of bad stuff,” said Jeff Tittel, Director of the New Jersey Sierra Club. “Governor Murphy needs to CV this bill to make it fairer and cut some of the pork. This bill needs to include real solutions to create real jobs and jumpstart our economy, not gimmicks like corporate subsidies.”