A task force the Murphy administration put together to scrutinize the state’s tax credit program wants lawmakers at a hearing scheduled for Monday to grill South Jersey political figure George Norcross over applications submitted by two companies where he is an executive.
The questions revolve around the $39 million tax break application submitted by Cooper University Health Care where Norcross is board chair and an $86 million tax break application for insurance company Conner Strong & Buckelew, where he is an executive.
The office of Sen. Bob Smith, D-17th District, – who chairs the Senate tax break committee – did not immediately comment on whether Smith will ask any of the questions to Norcross when he appears on Monday.
Committee Chair Senator Bob Smith during a meeting of the Senate Select Committee on Economic Growth Strategies. – AARON HOUSTON
“The task force is aware that Mr. George E. Norcross III has requested to appear before the Committee and is listed as a witness for the hearing. Mr. Norcross has publicly stated that he wishes to testify before the Committee to respond to statements and information presented by the task force… Further, he claims that he was not afforded a meaningful opportunity to respond,” reads the letter to Smith from task force counsel Jim Walden of Walden Macht and Haran LLP.
“However, on no less than three occasions, the task force afforded Mr. Norcross the opportunity to testify,” the letter continues.
Both companies allegedly provided bogus data about locations in Philadelphia they would move to, rather than stay in New Jersey, if they did not win the tax breaks, according to the task force, which Gov. Phil Murphy put together in January.
“Many, if not all, of these questions have been answered previously – and would have been answered directly to the task force if Conner Strong & Buckelew, NFI, TMO, and Cooper had been given a legitimate opportunity to discuss these issues, and not as little as five minutes of public comments or a written statement,” reads a statement from Daniel Fee, a spokesperson for Norcross.
According to the task force, Conner Strong, NFI and The Michaels Organization obtained office quotes for a Philadelphia site despite no actual plans to move there. They were represented by Kevin Sheehan, a law firm where George’s brother Philip is a partner, according to the task force, and provided questionable information to the EDA.
Ultimately, the three companies won a combined $245 million tax break to open a new office tower overlooking the city waterfront, known as the L3 building.
Cooper in 2014 concocted plans for a bogus Philadelphia location where they had no serious plans to move to, just so they could win the tax break, according to the task force.
Cooper initially said it had no plans to move jobs out of the state, only to later certify that 353 jobs were at risk of leaving the state if the incentives were not granted, the task force added.
In June, the task force subpoenaed all four companies for documents on how they won their incentives, which could show how the four applicants made false claims about plans to leave the state without the incentives.
The Philadelphia office quotes, “were created solely for the purpose of submitting evidence of an alternative site to the EDA” to boost Cooper’s chances of winning the tax break, according to the report, which adds that the task force award should be much closer to $7 million.
Open to question
Walden said he wants Smith to ask Norcross when a representative from Conner Strong & Buckelew visited their proposed alternative site at 160 Market St. in Philadelphia, whether Norcross personally visited the site, and when the firm was considering a move to the city.
Special Counsel Jim Walden speaks at a May 2, 2019 hearing of the New Jersey Task Force on EDA Tax Incentives. – AARON HOUSTON
Walden also wrote that he wants Norcross to answer whether he was aware of a September 2014 meeting to discuss the waterfront towers’ construction, if he attended that meeting, and if at the meeting he discussed the L3 building “for “CBS’s consolidation.”
Conner Strong, NFI and TMO announced at a September 2015 news conference that they would be moving to the Camden waterfront site, a year before the three submitted their tax break applications, according to the task force.
Walden said he wants Norcross to elaborate on a September 2015 memo that Fee wrote, according to the letter, to Conner Strong President and Chief Executive Officer Michael Tiagwad that “it will be difficult to walk the line that needs to be walked – highlighting the development and involvement of you and George without crossing any line to confirm that Conner Strong is likely to move its headquarters.”
Fee told NJBIZ that “CBS hadn’t committed to Camden, hence “it was important to ensure that no one believed it had.”
Walden said he wants Smith to ask Norcross what role he played in Cooper’s application, if he reviewed the application, if Cooper had plans before or during the application to move jobs out of the state and why Cooper gave the EDA details about its alternative site in Philadelphia.
In addition, Walden wants to know more from Norcross about the interactions between Cooper executive Andrew Bush and CBRE real estate broker Jon Sarkisian about scouting out a Philadelphia location.
Those questions include why Bush wanted a location out of the state – even though it was not required, why he needed it to be “credible,” why he wanted Sarkisian to proceed “quietly,” and why Bush and Cooper Health wanted a “credible threat to move” out of the state.
“These questions, like the task force’s report, show a fundamental misunderstanding of the Grow NJ law and the New Jersey Growth Zone program. George is looking forward to Monday to clear up the many misstatements, misunderstandings, and mistruths about Camden and the firms that are investing in its future,” Fee added.
