Gov. Phil Murphy couldn’t have found a friendlier crowd at a family reunion at the left-leaning New Jersey Policy Perspective annual conference. The progressive think tank welcomed the governor, who talked about tax incentives and New Jersey’s embattled Economic Development Authority, the independent agency that’s at the center of a raging political firestorm for allegedly lavishing rigged tax breaks upon corporate cronies.
“Our current system of open-ended and weakly-enforced corporate tax breaks is hurting our ability to invest more deeply in our state, and in particular, in the things that businesses look for when choosing a location,” Murphy said.
Murphy ordered a special task force to investigate the EDA. It’s focused on hundreds of millions in tax credit largesse showered upon Camden projects with corporate connections to South Jersey political strongman George Norcross, amidst accusations that the 2013 tax incentive law was allegedly tweaked to benefit the Camden Democrat and his business pals. That sparked a furious counter-attack from Norcross in an interview with NJ Advance Media, who claimed that Murphy “thinks he’s the King of England.”
“I agree with Norcross. I think this is a McCarthyist, this is like a McCarthy trial. They won’t let the people they’re accusing testify in public — they have to submit written documentation. So what are you afraid of, if this is a legitimate process?” said loyal Norcross ally, Senate President Steve Sweeney.
Sweeney has authorized a separate Senate panel to investigate the EDA, and so has Speaker Craig Coughlin in the Assembly. That’s three EDA inquiries as the agency’s two main tax break programs spiral towards expiration in July.
“I don’t really give a damn about the soul of the Democratic party. They can have that battle all they want. And I have friends on both sides of that battle. I’m not interested. For me, it’s a policy issue. And New Jersey’s already business-unfriendly enough. This battle doesn’t help,” said Republican state Sen. Declan O’Scanlon.
O’Scanlon sat on a separate NJPP panel Friday to discuss the future of economic incentives for developing New Jersey business. Again, the EDA scandal and how it bestowed tax breaks, even upon companies that had no intention of moving out of New Jersey controlled the narrative.
“I think that we should be targeting small- and medium-sized businesses, who need the money to grow — not just large companies that are going to use it to pad their bottom lines,” said Seth Hahn, New Jersey’s legislative and political director for the Communications Workers of America, the state’s largest public employee union.
“Return the sort of balance of power over control of the state finances, from, you know, the corporations that are kind of being able to game the system here, back to the taxpayers,” said Jon Whiten, deputy director of state communications at the Center on Budget and Policy Priorities.
The governor wants tax incentives, but wants them capped and targeted. He has so far refrained from characterizing the EDA battle as a proxy political war.
Sweeney steadfastly denies there’s any personal animosity, but the conflict’s derailing major legislation and sucking up oxygen and it won’t make budget talks any easier.