Since 2008, New Jersey has required the state Department of Treasury to provide details on how businesses that receive tax breaks deliver on their promises — but such a report has never actually been filed.
State Sen. Raymond Lesniak, D-Union, a longtime supporter of the incentives program, will present a bill Thursday calling for a halt to all business tax incentives until there’s transparency.
“We need to know whether the administration is allowing any company to get by with skirting the requirements, like say the number of jobs,” said Lesniak. “This is a checkmate on the administration to ensure the program is being run effectively.”
General information regarding tax incentive spending can be found online, but the state’s treasury department says that sharing specific taxpayer information is a violation of IRS code.
“Federal privacy issues are of a major concern to us, and that is why the Department of the Treasury has been unable to publish the report,” said treasury spokesman Joe Perone. “The current statutory language contemplates collecting data across numerous agencies that would be contrary to legal restrictions concerning the safeguarding of taxpayer information.”
Perone said the department has made a number of legislative suggestions since the bill was passed that would allow reporting the data.
Lesniak counters that his bill will require only specific company information, not necessarily specific company names, but admitted that perhaps he had failed to communicate that to the department clearly.
“It appears they’re reluctant to even do that or they would have done it by now though,” said Lesniak.”If I have to make changes in the law to specifically explain to them what we need, I’ll do that.”
The Economic Development Authority has granted more than $5 billion worth of tax breaks in New Jersey since 2010, and businesses relocating to Camden County, in particular, have been awarded just over $630 million in incentives since 2013.
“It is clear when you have dozens of businesses looking to move to Camden with promises of thousands of employees, it doesn’t take another report to tell us that it’s working,” said Jeffrey Nash, a Camden County Freeholder board member. “You can see and feel that it is, and any suggestion that a report needs to be done to quantify it, I think, is not being 100 percent forthright.”
Subaru, Holtec International and the Philadelphia 76ers are among a few major companies that have relocated facilities to Camden, bringing a few hundred jobs in exchange for millions in tax refunds — more so than some companies even make in a year — sparking a debate over whether the breaks are doing more harm than good.
If employees are not working before the end of the decade, then the tax incentives expire anyway under the law,” said Nash. Why not wait and see how effective the program is then, he asked.
“Of course you want to be transparent, but to place a moratorium before a program comes to fruition unravels all of that positive energy,” Nash said.
Lesniak said his bill isn’t looking to nail any particular company, and he doesn’t want a moratorium either.
“My biggest concern is that this whole incentive program is going to be terminated because there’s no confidence it’s being administered correctly,” said Lesniak. “If it’s producing jobs, like I believe it is and should be, then we should know it so the program can continue to exist.”