By Chief Political Correspondent Michael Aron
State Treasurer Andrew Sidamon-Eristoff hosted his second annual economic forum today in Trenton. It was planned well before the big storm, but the state’s economic outlook has been changed by Sandy.
Rutgers economist Joseph Seneca said it’s still early to assess the economic impact of the storm, and also complicated. The negative impacts, he said, include the loss of housing, commercial and industrial infrastructure, people’s incomes and retail sales. Off-setting the losses are various gains in economic activity.
“What we do think is going to happen is that there’ll be a short term hit to sales, incomes, employment and tax revenues from all the disruptions that have inevitably come with a storm of this intensity, but over time the repair, replacement, renovation, rebuilding will generate significant positive impacts particularly as much of that will be financed by private insurance, by FEMA and by I think what’s likely some additional, significant federal support,” Seneca said.
The treasurer was asked about Sandy’s impact on state revenues and the state budget.
“You’re gonna see some pluses and minuses. We would expect to see some revenue coming out of the rebuilding activity, the recovery activity. We’re also going to see some negative impacts from business interruption,” Sidamon-Eristoff said. “There are gonna be things like lottery sales and other kinds of business activity that can’t be recouped.”
Economist Joel Naroff talked about the Jersey shore, and his vacation home in Margate.
“We’ll clean up from that, we’ll rebuild. We’ll probably … wind up with higher property values in the long term on the shore areas,” Naroff said. “But the real question is Atlantic City and for a long time that monopoly was wonderful.”
Naroff is worried about competition for the resort from other states. Others weighed in.
“And I do think that this is actually going to be a positive in the very, very near term as a bit of a kick start for the economy, not big and it doesn’t last long,” said Moody’s Analytics Managing Director Steve Cochrane.
New York Gov. Andrew Cuomo put a $30 billion price tag on Sandy-related damage in his state. New Jersey officials have been slower to come up with a number. Seneca says you want a number that’s credible, not one that turns out to be too low. Gov. Christie says he’ll sit down with the treasurer Friday to get a damage estimate and to hear the likely impact on state tax revenues.