EDA to review Teva, Norcross-tied corporate tax breaks

Daniel J. Munoz//June 26, 2019

EDA to review Teva, Norcross-tied corporate tax breaks

Daniel J. Munoz//June 26, 2019

The public hearing of the New Jersey Task Force on EDA Tax Incentives on May 2, 2019. – AARON HOUSTON


The Economic Development Authority is seeking more information about how six companies received corporate tax breaks, as the Murphy administration homes in on how several businesses tied to a South Jersey powerbroker may have taken unfair advantage of the program.

The NJEDA on Wednesday announced it issued a formal request to the companies for supplemental information regarding the Grow New Jersey tax credits they received.

Five of the companies named have been the subject of scrutiny from a task force convened by Gov. Phil Murphy to scrutinize how the Grow New Jersey tax break program was crafted, who received tax breaks and how they were won, while the sixth has been cited by critics as having been notably absent from the proceedings.

The Michaels Organization, NFI, insurance firm Conner Strong & Buckelew, Holtec International and Cooper University Health Care – businesses with ties to political powerbroker George Norcross – and Teva Pharmaceuticals will be able to submit written responses to a “range of recent developments,” the EDA said, including the release of the task force’s 75-page report and a recent legal settlement.

The task force issued subpoenas to those same companies for documents it argues might show how they allegedly falsified plans to leave the state in order to win more generous awards.

NJEDA CEO Tim Sullivan speaks on March 20 at the Commercialization Center for Innovative Technology in North Brunswick. – EDWIN J. TORRES/GOVERNOR’S OFFICE

“We have no higher obligation than to serve as stewards of taxpayer dollars, and the process we are initiating today will enable our team to make a determination of appropriate next steps with regard to these specific companies,” NJEDA Chief Executive Officer Tim Sullivan said in a statement.

“Transparency and accountability should be the hallmark of any public investment program, and we take any allegations of wrongdoing very seriously,” he added.

The EDA said any changes to award Grow NJ tax incentives – which could include reductions to award amounts, suspensions or terminations – may require action from the NJEDA board.

Darryl Isherwood, a spokesperson for Murphy, said the governor’s office in May requested a review of Teva’s application for a $40 million tax break.

Gov. Phil Murphy signed a proclamation welcoming Teva Pharmaceutical to New Jersey and hosted a roundtable discussion on investing in the state on October 21, 2018. – EDWIN J. TORRES/GOVERNOR’S OFFICE

On Monday, a complaint was unsealed alleging the drug manufacturer was part of a conspiracy to artificially hike prices on more than 100 different drugs. Teva, which is planning to move its North American headquarters to Parsippany with incentives awarded under Murphy, allegedly took part in the conspiracy to boost its finances and profits, according to the court filings and Attorney General Gurbir Grewal.

Teva also recently settled with the Oklahoma attorney general, who alleged the company helped fuel the U.S. opioid epidemic in a $85 million lawsuit over its production of the drugs.

Critics of Murphy’s actions regarding the Grow NJ corporate tax breaks and his desire to end the program for good once it expires on July 1, have often pointed to Teva’s opioid lawsuit, arguing the administration, and the task force he convened, have declined to probe the pharmaceutical company while at the same time examining how businesses with ties to Norcross won hundreds of millions of dollars in incentives for moving to Camden.

According to the EDA, letters may be sent to additional companies as needed.