BUSINESS & ECONOMY

Questions Surround EDA Business Tax Breaks

By Briana Vannozzi
Correspondent

By most accounts, a $118 million tax break to move four miles down the road is a pretty good deal. Even if that road leads to downtown Camden. Subaru’s U.S. headquarters took the offer. So did a handful of other major corporations in various EDA tax credit programs.

In 2014, the city of Camden received $630 million in future tax breaks for development projects. And those incentives are being called into question.

The Associated Press reports that many of the deals have ties to political donors or powerbrokers. Tax breaks for the city, including the Subaru deal, have been approved for:

– $260 million to energy company Holtec International, an Evesham based nuclear equipment manufacturer.

– $107 million for defense contractor Lockheed Martin to move from nearby Moorestown.

– $82 million in tax credits is approved for the Philadelphia 76ers to hop across the water and build a practice facility in the city.

– $40 million in tax breaks will go to Cooper Health System — the hospital is already located there — to relocate the Cherry Hill and Mount Laurel offices.

“That activity however is unlikely to benefit any of the current residents of Camden, which is one of the poorest cities of the country. And if you’re in one of the poorest cities in the country, you probably don’t have the skills that, for example Subaru would look for in terms of marketing or communications,” said New Jersey Policy Perspective President Gordon MacInnes.

They’ve also been linked in one way or another to South Jersey Democratic power boss George Norcross who sits on the board for Holtec and Cooper Hospital and whose insurance company does business for it. His brother is also part of a law firm that represents the 76ers.

The Economic Development Authority confirms that under the Christie administration, it has approved just over $2 billion in business tax subsidies.

And that’s just for 2014. Those incentives fall under the Economic Opportunity Act, which Gov. Chris Christie signed in 2013 — aimed at bolstering development and low-income housing in cities like Camden.

In an email with the EDA, a spokesperson emphasized the development programs are “…bipartisan, legislatively created…”

“To be clear, no funding is provided to a business until the project is completed, actual new taxes are generated and confirmed; and all commitments with regard to job retention and creation have been fulfilled and reported on. No taxpayer funds from EDA-administered incentive programs are awarded to a company up front.”

A Pennsylvania-based developer is also under fire for big political contributions both to Democrats and Republicans — including the Christie-led RGA. He’s been renovating and building low income housing in Camden since the early 90s — a time he says no one else would touch the place. His spokesman said it was ridiculous to link the political contributions and declined to comment.

“Roizman is one of only a handful of developers in the country who has successfully renovated and managed low income scattered sites in urban areas, having done so now for 25 years,” said Marcus Group President and CEO Alan Marcus.

“We all hope that in the end, these flamboyant incentive programs will benefit New Jersey and New Jersey taxpayers. The formula that’s in place for Camden city makes that, I think, highly unlikely,” MacInnes said.

Defenders of the incentive programs, like Roizman’s development company, say without it, drawing business to areas like these would be nearly impossible.