Assemblyman Troy Singleton -- a key Democratic sponsor of the bipartisan legislation that remade New Jersey’s tax-incentive programs in 2013 -- has introduced a bill that would require a regular review of their effectiveness to be prepared and posted online.
The bill from Singleton (D-Burlington) comes in the wake of Christie’s rejection in May of an earlier measure he sponsored that would have required yearly evaluations of the incentive programs to gauge how well the tax breaks have been benefitting the state and its economy.
Christie, a second-term Republican, said in his veto message that the incentives shouldn’t be subjected to one-year reviews because it can take longer for the effectiveness of the tax breaks to fully develop.
Singleton latest try also comes just as the agency that administers the tax incentives, the state Economic Development Authority, approved a series of new tax breaks last week that bumped up the total potential value of the incentives awarded since Christie took office in 2010 to a full $6 billion. They included $188 million in new tax breaks for JPMorgan Chase Bank and $27 million for Jaguar-Land Rover of North America.
As a point of comparison, the total dollar value of the tax credits awarded through EDA for the decade before Christie took office was less than $2 billion. Thus, from 2010-2015 the awards totaled roughly three times the amount of those bestowed from 2000-2010.
Ideally, the tax incentives -- which are not outright grants but provide breaks on future tax bills if certain requirements are met over time -- allow the state to remain competitive with neighbors like New York and Pennsylvania, which have aggressively sought to lure companies out of New Jersey with their own lucrative incentives.
But critics in recent years have questioned whether New Jersey’s tax breaks have become too generous and whether enough analysis is being done to ensure the state is getting good value in exchange for the incentives at a time when funding for things like education and transportation has been stretched thin.
The 2013 legislative changes cosponsored by Singleton and signed into law by Christie included lowering minimum investment and job-creation requirements and establishing special zones and conditions that can help companies looking to move to New Jersey or to stay here qualify for even greater incentives.
For Christie, the incentive programs have become a key feature of his economic-growth strategy as the state has struggled to recover jobs and tax revenue lost during the past recession. And since the 2013 changes were enacted, more than $3 billion in potential tax breaks have been awarded by the Economic Development Authority, according to New Jersey Policy Perspective, a liberal think tank based in Trenton that has kept close track of agency’s use of the tax breaks.