The state Legislature’s top senator said Tuesday he wants a Dec. 17 vote on a potential tax incentive bill. But a deal on the long-contested program cap remains elusive.
Both Senate President Stephen Sweeney, D-3rd District, and Gov. Phil Murphy have locked horns over the matter of capping the program, known as Grow New Jersey, which expired over a year ago.
Under the governor’s sought-after cap, the state would only award a set dollar amount of tax breaks each year to businesses either considering leaving the state, or eyeing a move into New Jersey.
Murphy has argued a cap is necessary to rein in out-of-control spending with the program for a cash-strapped state. Critics argue that businesses would be averse to a New Jersey move if they were not certain that state aid would be available to them. They’ve backed caps for individual projects, but not the program as a whole.
But the Senate President last month contended that he might agree to cap, so long as “we can raise it high enough.”
“We just don’t want to create a system… where certain parts of the state get all the money… and other parts get nothing,” Sweeney said Tuesday morning at the New Jersey League of Municipalities annual conference, held virtually this year.
One legislative source said that the program would need an “appropriate balance to not lose landmark projects and to ensure that any cap protects geographic economic development.”
Otherwise, the talk on an overall program cap remains an “ongoing issue.”
“The Assembly has been working with the Senate and governor on tax incentive legislation for well over two years and continues in effort to finalize a fair and responsible bill that will help boost New Jersey’s economy,” reads a statement from Kevin McArdle, a spokesperson for the Assembly Majority Office. “We hope to achieve that goal soon.”
The governor’s office did not respond to several requests for comment.
“We don’t want to shut out areas that could really use a boost,” the Senate President added Tuesday. “That’s what the incentive program is intended to do, to help boost the areas that are struggling.”
Over its six years, the state awarded $4.6 billion in Grow NJ incentives.
Sweeney said last month that a cap would “deter interest,” and that If people say ‘you’ve already hit the cap’, no one’s going to want to look at it. Last year, a task force that Murphy convened to scrutinize the incentive program honed in on how it may have been crafted to benefit politically connected interests, such as those of South Jersey political powerbroker George Norcross, a major ally and childhood friend of Sweeney.
The task force looked at how businesses with ties to Norcross may have improperly won hundreds of millions of dollars in Grow NJ incentives in return for staying in Camden, often considered one of the poorest in the state.
But Sweeney and Murphy have largely agreed on many other aspects of a Grow NJ replacement, with mediators such as Assembly Speaker Craig Coughlin, D-19th District, former Democratic state Sen. Raymond Lesniak and former Republican state Sen. Joe Kyrillos.
Those included program features such as stricter oversight, more community benefits, alleviation of food deserts, incentives to boost startups, and a so-called “evergreen fund” where the state and venture capitalists would jointly finance certain startups.
“I don’t think we’re that far off, but I’m frustrated we’re not there yet,” Murphy said in December.