$14.5 Billion Corporate Subsidy Bill Released from Committee Today

The Assembly Appropriations Committee and Senate Budget and Appropriations Committee have both released S3295 (Ruiz) / A4 (Pintor Marin). The “New Jersey Economic Recovery Act of 2020” provides for administration of programs and policies related to jobs, property development, food deserts, community partnerships, small and early stage businesses, State procurement, wind energy, and film production.

“It was wrong that the Legislature acted so quickly in moving this legislation. They did this without transparency or public scrutiny. It is shameful that the Governor and Legislature want to spend up to $14.5 billion without any public input or oversight. We are in the middle of an economic downturn. We don’t have money for necessary infrastructure upgrades of coronavirus relief, but the legislature wants to give Big Business a massive corporate subsidy. This is even more than the $8 billion in corporate tax breaks that Christie gave out,” said Jeff Tittel, Director of the New Jersey Sierra Club “The Legislature needs to slow down the process. They said it was $11.5 billion, but now we know it is $14.5 billion all in. We shouldn’t be rushing when we don’t even know how much money will be spent. When the government works behind closed doors, they are not doing the people’s business.”

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 $14.5 billion over the next six years.

“The EDA should be known as the Excessive Debt Authority. All of the debt from these corporate subsidies 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. We oppose this legislation because it is just restarting Christie’s corporate tax breaks and subsidies. Governor Murphy criticized Christie’s corporate subsidies, but now he is pushing even higher subsidies than Christie did,” said Jeff Tittel. “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.”

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.

“We had opposed this tax program in the first place in 2013 when Christie was governor. Now Murphy is trying to restart it and make the same mistakes, and the legislature is pushing it through right before the holidays. These subsidies have been shown not to work. They enrich corporations and don’t actually 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,” said Tittel. “The state has cut environmental funding, yet they want to provide millions for businesses that don’t actually need it.”

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.

“We are in the middle of a public health crisis and economic downturn. Instead of spending billions on corporate subsidies, we should be investing in New Jersey. We should be putting people make to work and creating real jobs instead of using corporate subsidy gimmicks that have been shown not to create jobs. We could be electrifying our transportation sector or expanding and improving our mass transit system,” said Jeff Tittel. “Expanding our offshore wind and solar programs instead of wasting money on corporate subsidies would create jobs while saving money and reducing air pollution.”

According to Governor Murphy, S3295 (Ruiz) / A4 (Pintor Marin) will be targeted to underserved communities that have been disproportionately impacted by the current coronavirus pandemic. It includes programs to fight food deserts, encourage brownfield redevelopment, and support historic preservation and renewal.

“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, yet they are pushing it through without time for proper oversight or public scrutiny. The bill does have some positives, but we don’t have enough information. 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 pork and bad stuff,” said Jeff Tittel, Director of the New Jersey Sierra Club. “Instead of rushing this through, the Legislature and Governor Murphy need to stop this bill. They need to come up with real solutions to create real jobs and jumpstart our economy, not gimmicks like corporate subsidies.”

(Visited 241 times, 1 visits today)

Comments are closed.

News From Around the Web

The Political Landscape