Subaru opens its doors in Camden, thanks to generous N.J. tax break

Claiming it wants to take part in Camden’s revival, Subaru of America has opened its new headquarters in the city — thanks, in part, to a generous tax break from New Jersey.

Although the $118 million tax break has drawn criticism of the state’s incentive program as “corporate welfare,” Subaru said its move is the latest in a series of positive developments for the distressed riverfront city.

“We had other opportunities. We could have gone other places, and we chose this city because it fits in with what we’re trying to do as a company,” said Tom Doll, president of Subaru of America. “Our job is not just to take. We want to be able to give back.” (According to its application for a tax break to the New Jersey Economic Development Authority, Subaru also considered relocating to the Navy Yard in Philadelphia.)

Subaru will bring more than 500 full-time jobs to Camden and create 100 more as it opens its new corporate headquarters, as well as a national training center for Subaru mechanics and technicians. It will be the fifth headquarters in as many decades for Subaru, which has also had home bases in Cherry Hill, Pennsauken, Bala Cynwyd, and Philadelphia.

The carmaker is one of 30 companies that have gotten more than $1.5 billion in state tax breaks to set up shop in Camden, build facilities, and create jobs.

Camden boosters, pointing to an era of unprecedented private investment in the city, say it is undergoing a once-in-a-generation renaissance that will improve the lives of residents.

“As someone who grew up in this city, I will tell you my residents are committed. They have dreams and the ability to succeed,” said Mayor Frank Moran. “What they need is opportunity, and that is what Subaru is offering.”

Yet Camden’s corporate boom has others watching with a doubtful eye.

“By almost all metrics, New Jersey’s economy is still lagging behind its neighbors and the rest of the country,” said Sheila Reynertson, a senior policy analyst with the left-leaning think tank New Jersey Policy Perspective.

Reynertson said the state’s main tax break program for businesses, Grow N.J., forgoes billions of dollars in tax revenue without getting a guaranteed return on its investment.

“We really feel strongly that there should be reforms to the program,” Reynertson said, suggesting the state could consider capping how much it gives out in tax breaks or stop giving out subsidies for existing jobs.

Others worry city residents will be left with the financial burden of paying for common government functions.

“They’re using our resources, our roads, our water and sewer infrastructure. Our fire and police personnel have to provide services,” said Kelly Francis, president of the Camden City Taxpayers Association and a past president of the city’s NAACP branch. “It’s costing us a lot.”

To supporters, tax breaks have been a critical part of the upswing in Camden in recent years, luring businesses —  Holtec International, American Water Works, and the Philadelphia 76ers — that may have otherwise settled elsewhere.

“What that will do is create a long-term employment base for the city that will have a multiplier effect by bringing in more residents, additional retail, hotels, spur some investment in public infrastructure,” said Jerry Sweeney, president of Brandywine Realty Trust, the developer behind Subaru’s new headquarters and Campbell Soup Company’s campus.

Subaru’s Tom Doll said the state’s gamble on companies moving into Camden will pay dividends. Just look at his company’s most recent headquarters, he said.

“When we moved into Cherry Hill, there was nothing around us. We had a burned-out racetrack across the way. We had no-tell motels along that Route 70 corridor,” Doll said. “Now look at it.”

Disclosure: Jerry Sweeney was formerly the chairman of the WHYY board of directors.