Sign In
Free Newsletter
Citing an independent study conducted by the New Jersey Business & Industry Association, the group’s president Michele Siekerka expressed pessimism regarding the state legislature’s discussion on economic policy that will continue on June 6 through the next few weeks.“(June 6) begins the next round of hearings on the constitutional mandate and NJBIA felt it was important to remind everybody that this bill does not stand alone as we consider its practical impacts on New Jersey’s economy and New Jersey residents,” she said.
The economic policies currently in play include new requirements on paid sick leave, a constitutional amendment to fund the public pension, raising the minimum wage to $15 an hour and additional information regarding bills on flexible hours.
“Right now, New Jersey is at a pivotal point in our economic recovery (and) just three years into slow and steady growth,” she said. “We entered 2016 with positive vibes for continued, steady growth as we learned from our business outlook survey from the beginning of the year.
“Then, within a matter of weeks, if not days, the piling on of economic policies commenced.”
Already in play at that time was paid sick leave, which Siekerka cited as a challenge to New Jersey businesses and, in particular, small businesses.
According to Siekerka, 70 percent of small businesses across New Jersey already provide paid sick leave. She said, coupled with the other economic policies in play, these new laws could have a negative impact on the state’s economy.
In her statements, Siekerka urged for a “comprehensive reform agenda that would make New Jersey affordable for all New Jersey residents.
“We all know affordability is already an issue for New Jersey residents and the legislative trifecta I’ve just referenced are policies that will take New Jersey in the wrong economic direction.”
According to the study conducted by the NJBIA, when the four most significant taxes in the state of New Jersey — income tax, property tax, corporate business tax and sales tax — are considered together on average across the nation, New Jersey ranks at 51, including the District of Columbia.
The study also looked to illustrate where the Garden State ranked in the nation in regard to outmigration.
“We also know New Jersey has suffered a loss in revenue over the last decade and we recently took a closer look at the year of 2013, which our report referenced as the year in which we lost $3 billion in net adjusted gross income,” Siekerka said.
The study standardized the out migration numbers to the GDP across the nation and found New Jersey again ranked last, at 51.
“New Jersey is at the bottom of every ranking, which includes out migration and the loss of net inflow to the state,” she said.
Siekerka urged for policies that look at “both sides of the balance sheet, revenue and spending; an agenda that doesn’t just look at what New Jersey residents earn, but one that looks at what New Jersey residents must spend in order to survive and why.”
Tag: South Jersey
NJBIZ stories taking place in and involving South Jersey businesses, companies and business news.
First Commonwealth Federal Credit Union appoints CEO
The First Commonweath Federal Credit Union board of directors announced Thursday that Donna LoStocco has been appointed CEO and president, effective July 1.LoStocco has succeeded Jo Ann Broderick, who is retiring after 17 years with the credit union.
“We would like to offer our sincere thanks to Jo Ann for her leadership at FCFCU. During Jo Ann’s tenure, FCFCU has grown to over $600 million in assets with over 55,000 members. We wish Jo Ann the best in her retirement,” Vince Gorman, chairman, board of directors, said in a prepared statement.
“I feel honored to have been chosen to become president and CEO of such a large, well-respected organization as First Commonwealth Federal Credit Union. I am excited to join the team, to meet First Commonwealth members and community stakeholders, and to work closely with the board to help further the First Commonwealth mission to improve members’ financial well-being,” LoStocco said in a prepared statement.
Prior to First Commonwealth, LoStocco was at the Affinity Federal Credit union for the past 18 years. Prior to Affinity, she worked for a commercial bank.
N.J. Association of Health Plans tries to reignite flame over out-of-network, surprise billing
The news of CarePoint Health’s out-of-network status with the state’s largest health insurer came as no surprise when it became official June 1.
But the New Jersey Association of Health Plans is trying to reignite the debate over surprise and out of network billing — a popular health care legislative debate last year which lost steam to the current front-runner: tiered networks.
All three CarePoint Health facilities in Hudson County have now officially become out-of-network with Horizon Blue Cross Blue Shield of New Jersey.
This includes Christ Hospital in Jersey City, Bayonne Hospital in Bayonne and Hoboken University Medical Center in Hoboken, with the last two pulling out in May and June 1, respectively.
The move was criticized by the New Jersey Association of Health Plans president Wardell Sanders, who said this increases the chances of surprise thousands-of-dollars patient bills — which CarePoint has been known for.
“The problem of price gouging and surprise billing just got bigger for New Jersey consumers, the State Health Benefits Program, the State Treasury and public employees,” Sanders said. “The governor’s proposed 2017 budget calls for $250 million in health care cost savings, yet CarePoint’s departure from the Horizon network will only exacerbate the challenges of rising health care costs for the state and other employers.”
CarePoint spokesman Jarrod Bernstein said, “Being out of network is not a business strategy it is a survival strategy. Since rescuing our hospitals from bankruptcy when we acquired them, we have invested tens of millions of dollars in technology and programs to care for ALL that we serve regardless of their ability to pay.”
Horizon said that since being out of network in June 2015, CarePoint’s Jersey City facility, Christ Hospital, has billed the insurer more than $68 million.
“Out-of-network hospitals generally charge rates well above those agreed to by network hospitals and state law allows out-of-network hospitals to charge whatever they wish for their services,” Horizon said in a statement. “Under state regulations, insured individuals receiving emergency care at an out-of-network hospital are only responsible for paying the amount they would owe if treated at a network hospital. Insurance companies generally must pay the balance. Some out-of-network providers take advantage of this regulation to steer patients through their ER’s and charge substantially higher rates for services. These higher rates increase the cost of health insurance for everyone. “
Out-of-network and surprise billing were a hot button political issue just last year, but since then tiered network rules have taken over, leaving the issue unresolved.
Sanders said the news about CarePoint shines a light back on the topic.
“New Jersey’s current out-of-network regulations include a loophole that is taken advantage of by certain facilities and providers who engage in predatory pricing, surprising consumers with unexpected bills and creating exorbitant costs for consumers, employers and unions. New Jersey has become a hotbed for unconscionable out-of-network billing practices. The status quo is neither fair nor sustainable for health care consumers in New Jersey,” Sanders said. “It’s time for the Legislature to step in and protect consumers, unions, employers, the State and other payers from surprise bills and unfair pricing in emergency rooms.”
Bernstein also commented on the tiered network debate.
“New ‘tiered’ health insurance products being introduced into the market stand to drive commercially insured patients away from tier 2 providers like CarePoint Health, further reducing vital revenue from commercial payers that offset the underfunding of government payers like Medicaid and charity care,” he said. “We encourage policy makers to embrace an All-Payer system that adequately compensates community hospitals like ours as we preserve New Jersey’s social safety net.”
CarePoint has been criticized for its high prices, and has twice been called out as the highest billing for Medicare patients in the country in the past two years.
The data putting it at the top of the list came from the Centers for Medicare and Medicaid last June.
But a few months later, CMS’s parent division, the U.S. Department of Health and Human Services, chose CarePoint as a source of example for its peers.
“Today, the Centers for Medicare & Medicaid Services awarded $685 million to 39 national and regional collaborative healthcare transformation networks and supporting organizations to provide technical assistance support to help equip more than 140,000 clinicians with tools and support needed to improve quality of care, increase patients’ access to information, and spend dollars more wisely,” according to the announcement in September, which listed CarePoint among recipients.
The data putting it at the top of the list came from the Centers for Medicare and Medicaid last June.
But a few months later, CMS’s parent division, the U.S. Department of Health and Human Services, chose CarePoint as a source of example for its peers.
“Today, the Centers for Medicare & Medicaid Services awarded $685 million to 39 national and regional collaborative healthcare transformation networks and supporting organizations to provide technical assistance support to help equip more than 140,000 clinicians with tools and support needed to improve quality of care, increase patients’ access to information, and spend dollars more wisely,” according to the announcement in September, which listed CarePoint among recipients.
In addition to the network concern, NJAHP accused CarePoint of not properly notifying patients through its website about the network status of health plans.
Sanders said the health system’s website is misleading because it lists insurers that it accepts, but does not specify which are in or out of network.
Bernstein replied, “We have gone to great lengths both online and off to make the community aware of our network status. Any statement to the contrary is false.”
Ahead of the anticipated move out of network with the state’s largest insurer, Hoboken pushed to move to a new health plan for city employees with United Healthcare.
In a letter to city employees in April, Mayor Dawn Zimmer said the move was better because in-network coverage would increase under the plan for both doctors and providers.
“Finally, by switching to UnitedHealthcare, our employees will continue to have access to all Carepoint Health facilities,” Zimmer said.
“CarePoint’s Hoboken University Medical Center provides essential healthcare services for our entire community, and I appreciate the investments they have made to ensure the highest level of service. My family’s primary care doctor is part of the hospital, and my entire family, including my children, husband, mother-in-law and myself have all received excellent care both at the hospital and through the family healthcare center. CarePoint helped the City of Hoboken navigate the healthcare battles in our State, and I appreciate that they are negotiating in good faith to reach agreements with healthcare providers to provide more in-network services,” she said.
But according to CarePoint, it is in network AmeriHealth and MagnaCare, but not with other major insurers, including Aetna, CIGNA, Oxford, Qualcare and UnitedHealthcare.
Bayonne, on the other hand, did not switch from Horizon for its health plans.
City spokesman Joseph Ryan said since New Jersey law covers emergency visits as in-network, there is no problem.
“Bayonne employees receive our health insurance through the State of New Jersey’s health benefits system. Through that system, most City of Bayonne employees have Horizon Blue Cross’s 20/30 plan as per collective bargaining agreements (union contracts). This covers hospitalization, office visits to doctors and other services. It is not just coverage for one hospital. The “20/30” refers to the fact that the copay is $20 for a visit to a primary care physician and the copay is $30 for a visit to a specialist. The emergency room copay is $125,” he said.
He added that the only issues arise if someone needs non-emergency care, but in that case there are other hospitals to go to in Jersey City or elsewhere.
Sanders said that while the law does exist, it only covers the 18 percent of commercially insured New Jersey residents. The remainder rely on care from state or federal health plans, which are the sources of reports that place CarePoint at the top of the list of most expensive hospitals in the country for the past two years.
Another point of contention Sanders raised was an emergency visit appointment tool. The idea of scheduling an emergency visit, or focusing on wait times, when the hospital community has been vocal about pushing patients into primary care offices seems like mixed signals, he said.
But CarePoint isn’t the only hospital to offer a scheduling tool or highlight emergency department wait times.
A quick online search shows Virtua Health, Inspira Health, The Valley Hospital and Morristown Medical Center also have similar tools.
The New Jersey Hospital Association replied that this is not supposed to be used to increase ED volume.
“These services are not intended to schedule non-emergency care in advance. They’re more of a “online check-in” to provide better service to people who are coming to the ED and hopefully alleviate some of their waiting time, and also to help hospitals anticipate the flow of patient demands. We agree wholeheartedly that emergency rooms are for emergent situations, and non-emergency needs should be handled in a more appropriate healthcare setting,” NJHA said.
Despite being out of network, CarePoint said it is willing to continue negotiations with Horizon.
“We remain open to continued negotiations in good faith with Horizon Blue Cross Blue Shield of New Jersey,” Bernstein said.
Camden youth athletic league gets 1M in seed money from foundations, insurer with video
The Cooper Foundation, Norcross Foundation and AmeriHealth New Jersey announced a $1 million collective starter fund for the new Camden Health and Athletic Association.The CHAA aims to be an umbrella youth athletic league for all the neighborhoods in Camden, according to Cooper Foundation CEO and President Susan Bass Levin. It will also help support existing leagues.
As or more impressive than the million-dollar investment is the roster of backers: Garry Maddox, former Philadelphia Phillies center fielder; Sal Paolantonio, ESPN national correspondent; Ron Jaworski, former Philadelphia Eagles quarterback; Mike Quick, former Eagles wide receiver; and World B. Free, former Philadelphia 76ers star — to name a few who were at the launch event Wednesday in Camden.
In addition, Camden County police and sheriff’s officers have agreed to participate as coaches, umpires, referees and mentors in the association.
Both Cooper University Health Care Chairman George Norcross III and his brother, U.S. Rep. Donald Norcross, reminisced about their own past, growing up playing sports in nearby Pennsauken, to highlight the importance of youth sports programs, especially in the birthplace or hometown of many sports greats — Camden.
“Strong youth athletic programs encourage healthy behaviors, create lasting memories and friendships for children who participate and their parents,” George Norcross said. “We have many challenges to bring to the citizens of this city the kind of things they deserve. Many times, when I am speaking, I describe the things I’ve had in my lifetime. The things I’ve enjoyed, the things I took for granted, that children in this city are deprived of in many ways. This is not just an athletic association, this is a health organization as well.”
Bryan Morton, with the North Camden Little League, said the health awareness was an important aspect that is often overlooked.
“Mr. Norcross had an idea; he reached out to community leaders to help, you know, put some meat on the bones,” Morton said. “He has been inclusive and supportive of our vision and our voice being a part of this process.”
Morton also spoke about the importance of a leading figure such as a coach or mentor in the life of at-risk youth.
“I think that none of us would be here if not for the compassion, for the knowledge, of a family member, teacher or religious leader, or a coach,” he said. “As coaches, we try to create safe places for our kids in the after-school hours.”
This includes a lot of funding from their personal pockets, Morton said.
He also said that, for some time, there has been opportunity for negative influences to create strongholds in some communities and influence the youth, and he hopes that CHAA will be able to eliminate that.
“The city of Camden has seen its struggles, and there are neighborhoods in the city where there are no pings in the spring, no mounds in the parks to be found and no cheers that children can ever recall being echoed. None of those familiar sounds that many of us have taken for granted,” he said. “Today, marks … a new way of life.”
Daniel Hilferty, CEO and president of Independence Health Group, the parent company of AmeriHealth, echoed the importance of youth programs in a community.
“Youth sporting events have played an important role in many of our lives — creating a rich sense of community, building lifelong friendships and encouraging healthy habits.”
Paolantonio said he was impressed by the collection of leadership spanning politics, business, sports and the community gathered in the room at Cooper University Hospital on Wednesday.
“At ESPN, we know the power of a great story. And this is another chapter in the fabulous story of the commitment of this hospital to this community. And this chapter of the (CHAA) is so very important because it is on the front line, down in the street,” said Paolantonio, who is also on the board of trustees for the Cooper Foundation. “It’s the commitment to finish the job right here in Camden, and that’s the great story that’s being told in this room.”
What are N.J.’s top-grossing law firms?
The New Jersey Law Journal has come out with its ranking of the Top 20 law firms in New Jersey, and while there are certainly some big names on the list, there are a few surprises, too.The New Jersey Law Journal ranked the firms doing business in the state by their New Jersey gross revenue, regardless of where they are based and how much revenue they grossed overall.
That meant some giant firms, such as the international Greenberg Traurig, ranked lower than smaller, but more Jersey-centric ones, such as Morristown-based Riker Danzig Scherer Hyland & Perretti. It also meant firms with a larger number of New Jersey lawyers, such as Roseland-based Connell Foley, might rank behind ones with fewer attorneys, such as Hackensack’s Cole Schotz.
The top firm was Roseland-based Lowenstein Sandler, which recorded $144.6 million in New Jersey gross revenue, more than half of its total $251.8 million in firmwide gross.
Newark-based McCarter & English ranked second, with $106.5 million in New Jersey gross. They were the only two firms to exceed $100 million in New Jersey gross revenue.
Another Newark firm, Gibbons, ranked third, with $85.6 million in New Jersey gross revenue.
The Top 20 firms, with their main New Jersey office and New Jersey and total gross revenues:
- Lowenstein Sandler, Roseland, $144.6M, $251.8M;
- McCarter & English, Newark, $106.5M, $233M;
- Gibbons, Newark, $85.6M, $108M;
- Sills Cummis & Gross, Newark, $84.9M, $84.9M;
- Fox Rothschild, Lawrenceville, $84.5M, $364.5M;
- McElroy, Deutsch, Mulvaney & Carpenter, Morristown, $82.2M, $118.5M;
- Archer & Greiner, Haddonfield, $72.5M, $87M;
- Chiesa Shahinian & Giantomasi, West Orange, $65.6M, $65.6M;
- Cole Schotz, Hackensack, $64.9M, $94.9M;
- Riker Danzig Scherer Hyland & Perretti, Morristown, $64.7M, $67.1M;
- Drinker Biddle & Reath, Florham Park, $64.3M, $410M;
- Greenberg Traurig, Florham Park, $55.6M, $1.32B;
- Wilentz, Goldman & Spitzer, Woodbridge, $53.9M, $58.2M;
- Connell Foley, Roseland, $53.3M, $57.6M;
- Stark & Stark, Lawrenceville, $47.1M, $54M;
- Greenbaum, Rowe, Smith & Davis, Woodbridge, $44.8M, $44.8M;
- Day Pitney, Parsippany, $44.5M, $161M;
- Budd Larner, Short Hills, $43M, $43M;
- Porzio, Bromberg & Newman, Morristown, $39.7M, $50.9M;
- Bressler, Amery & Ross, Florham Park, $37.5M, $80M.
For the New Jersey Law Journal’s report, click here, and to see the Top 20 chart, click here.
For the NJBIZ list of top law firms, click here.
Christie signs Atlantic City compromise legislation
As expected, Gov. Chris Christie put pen to paper Friday on legislation that will now give Atlantic City 150 days and a $60 million bridge loan to balance its budget for the upcoming fiscal year and develop a sound spending management plan for the next five years.If Atlantic City cannot meet Trenton’s demands in that timeframe, the state will move forward with a takeover of the city’s finances, as was initially proposed months ago by Senate President Steve Sweeney (D-West Deptford) and supported by the governor.
Christie wasted no time in signing the measure, just one day after the Assembly and Senate voted Thursday to send it to his desk.
“These new laws will ultimately accomplish my mission to reform Atlantic City’s overblown municipal government and, in turn, protect local and state taxpayers from being perpetually abused by the special political interests who admit to owning this city’s elected officials,” said Christie. “We all agree that Atlantic City’s government has not demonstrated the competence to properly manage the people’s money without state guidance and oversight and, as I’ve said all along, they will not be getting any more blank checks from state taxpayers as the Legislature had proposed last summer.
“This legislation means no more business as usual. It embraces my demand that Atlantic City immediately account for every dollar it receives and spends, and triggers a series of strict conditions and rigorous requirements the city must meet immediately.”
The signed bills put an end to months of infighting between Christie, Sweeney and Assembly Speaker Vincent Prieto (D-Secaucus), who had declined to post the Senate-supported takeover measure on the grounds that it went too far and threatened existing collective bargaining agreements.
In that time, Christie repeatedly criticized Prieto for what he believed was an appeal to the interests of public union bosses rather than action in the best interests of Atlantic City residents.
“For Atlantic City officials, the final countdown starts today,” Christie said Friday. “They now have 150 days to develop and implement fiscally responsible reforms and finally meet the obligations of every other municipal government in our state. They know that if they fail to change their tendencies of wasteful spending and mismanagement, my administration will be empowered to immediately step in and do the job for them.”
Sweeney said that, rather than a cause for celebration, Friday’s bill signing is a “clear indication that much of the hard work down in Atlantic City is about to begin.”
“What we have accomplished in Trenton is to set the stage for Atlantic City’s restructuring into an economically stable, culturally vibrant, keystone to the New Jersey’s tourism industry,” Sweeney said. “But the only way that happens is if the local government delivers on their commitment to live up to the spirit of this reform legislation.”
The move even garnered some hesitant approval from Wall Street, where credit rating agencies have recently piled on Atlantic City with negative downgrades.
Moody’s analyst Douglas Goldmacher said Friday’s news was “a credit positive development that provides short-term financial relief for Atlantic City, and removes the immediate threat of a default or bankruptcy filing.”
Still, as Goldmacher noted, the city will continue to be monitored closely for the possibility of debt restructuring and eventual default.
Assembly approves 15 minimum wage bill
The Assembly voted Thursday to approve legislation that looks to gradually increase New Jersey’s minimum wage to $15 per hour over the next five years.The measure would immediately hike the current minimum wage, set at $8.38 per hour, to $10.10 per hour and then raise that rate annually by $1 to $1.25 per hour plus the rate of inflation until the $15 per hour threshold is reached.
In the Assembly, the bill is sponsored by Assembly Speaker Vincent Prieto (D-Secaucus) and Assemblymen John Wisniewski (D-Sayreville) and Gary Schaer (D-Passaic).
“This is an integral component in our efforts to stop the decline in the middle class and lift working families out of poverty,” said Prieto. “The constitutional minimum wage that we established a few years ago set a floor, not a ceiling. We must ensure that all workers are paid fairly for their labor. We now need to strive for better to reverse the poverty trend in this state.”
The measure has advanced out of committee and awaits a full vote in the Senate, where it is being sponsored by Senate President Steve Sweeney (D-West Deptford).
“When businesses fail to pay a living wage, government is forced to fill the gap,” said Wisniewski. “Essentially, taxpayers are subsidizing these low-paying jobs and, in the process, suppressing wages for everyone else in the workforce. It’s not fair for workers or for the taxpayers who end up paying the bill. The American economy works best with a healthy middle class that has money in their pocket to spend.”
“Artificially inflating the value of a minimum wage job to $15 an hour, and thereby resetting the value of every single job in New Jersey, is not the answer,” said New Jersey Business & Industry Association president and CEO Michele Siekerka. “The focus must be on comprehensive tax reform and reducing the high cost of living in New Jersey so that people in entry-level jobs to afford to live here and advance in their careers.”
Business groups have railed against the proposal, claiming the hike would present a cost burden that would fall unfairly on the backs of employers, many of whom are still adjusting to the last minimum wage increase passed through voter referendum.
Voters agreed in 2013 to up the state’s then-minimum wage of $7.25 per hour by $1, to $8.25 per hour, and tie all future increases to the consumer price index.
“The shameful fact that full-time work isn’t enough to lift a New Jerseyan out of poverty should be enough to convince everyone in the state to raise the minimum wage,” said New Jersey Policy Perspective analyst Brandon McKoy. “But there is a clear economic case for doing so as well. Boosting the earnings of nearly 1 million working people in the state would help restore the strength of our working and middle classes, give a shot in the arm to local economies and Main Streets across the state and lay the foundation for a more prosperous New Jersey for all residents.”
While Gov. Chris Christie is expected to veto the legislation should it reach his desk, Sweeney and Prieto have indicated their willingness to place the question on the ballot as a voter referendum.
Atlantic City compromise legislation heads to Christie’s desk
The Assembly and Senate both voted Thursday to approve legislation that will give Atlantic City 150 days and a five-month bridge loan to balance its budget for the upcoming fiscal year and develop a five-year management plan.Should the city fail to do so, the state would then move forward with a takeover of the city’s finances, as was initially proposed through legislation put forward at the beginning of the year by Senate President Steve Sweeney (D-West Deptford) and supported by Gov. Chris Christie.
The compromise measure is the culmination of months of infighting between Sweeney, Christie and Assembly Speaker Vincent Prieto (D-Secaucus), who had declined to post Sweeney’s bill on the grounds that he believed it went too far and threatened existing collective bargaining contracts.
“I feel that we got into a place that this is something everybody could live with,” Prieto said. “I think when you compromise, it makes it a better bill. Not everybody gets everything that they wanted. This is something that now the administration of Atlantic City can roll up their sleeves with their workforce and I think we’re giving them an opportunity to again be the jewel of New Jersey.”
With the Legislature at an impasse last month, Sweeney proposed giving Atlantic City 130 days to cut its per capita spending by nearly half before a takeover would take place.
“This plan gives Atlantic City the opportunity to do the job itself to prevent bankruptcy and make desperately-needed financial reforms,” said Sweeney. “Along with the reforms, this plan will provide financial resources and the ability to access the financial markets, which is critically important for long-term fiscal health. We must have a workable plan that is implemented and followed that will reduce spending, reform government operations so that city services are maintained and the taxpayers of Atlantic City and New Jersey are better protected. If the city fails, the state will assume the responsibilities.”
Christie is expected to sign the measures.
“My position on this has never wavered: bankruptcy can never be on the table for Atlantic City.,” said Assembly Majority Leader Lou Greenwald (D-Voorhees), who had supported Sweeney’s plan from the start. “Now, we can begin focusing on the hard work that needs to be done to close the city’s structural deficit and ensure financial stability moving forward without the looming threat of bankruptcy hanging overhead.”
Thursday’s votes even garnered support from some area legislators who have been weary of the prospect of a state takeover.
“While today’s passage of Atlantic City recovery legislation is just the beginning in the fight to stabilize the city’s finances, we have provided a much-needed lifeline to Atlantic City in order to avoid bankruptcy,” said state Sen. Jim Whelan (D-Northfield). “It is now up to city government, the Mayor and City Council, to make very difficult decisions and offer a clear plan to balance its budget. I strongly urge the governor to sign these bills into law as soon as possible so we can begin to move forward.”
Casino leaders, legislators spar over North Jersey gaming referendum
Resorts Hotel CEO and President Mark Giannantonio says that an internal study that will soon be released indicates that if New Jersey residents approve the expansion of casino gaming this November through a voter referendum, the economic impact on Atlantic City would be severe and the city could lose three to five more casinos.Giannantonio added that proponents of the measure, which calls for two new gaming permits to go to planned casinos in separate counties located at least 75 miles away from Atlantic City, have yet to properly examine its potential economic impact on the city and region.
“They never really studied the issue,” Giannantonio said Thursday, speaking on a panel about the issue at the annual East Coast Gaming Congress held at Harrah’s Resort in Atlantic City.
New Meadowlands Racetrack CEO Jeff Gural, an emphatic supporter of casino gaming in northern New Jersey who was part of a proposal last year to bring Hard Rock International to his Meadowlands site, questioned the validity of the findings from Giannantonio’s “meaningless” study.
“Seriously, that’s crazy,” Gural said in response to the notion that three to five more Atlantic City casinos would shutter as a result of gaming upstate.
Speaking directly to Giannantonio, Gural said that considering the city’s problems, Atlantic City should be pleased with the proposal’s allotment of up to $200 million from future northern New Jersey gaming revenues being sent back to the city for non-casino redevelopment efforts.
“To get to your casino, you have to drive through a slum … You need it more than anybody,” Gural said.
Former Reebok CEO Paul Fireman, who has previously proposed a $4.6 billion casino on the Jersey City waterfront, said that Atlantic City is “still a major brand” that needs to be honored and raised up. Instead, he says, the infighting over the city’s financial future has just led to bad press that has hurt the city’s brand.
Fireman said that Atlantic City operators and area legislators need to face the fact that “people have been pilfering your industry for years” and realize what a revenue opportunity northern New Jersey poses.
“If this particular market wants to squander it, and I doubt they do, then that would be foolish,” Fireman said.
While the current proposal would only allow for currently licensed operators to apply for one of the two new gaming permits, it also stipulates that a $1 billion capital investment is made for each casino. Both Gural and Fireman, who are not licensed operators currently, indicated that they believe there will be partnering opportunities for their projects.
The panel also featured state Sen. Paul Sarlo (D-Wood-Ridge), a proponent of gaming expansion, and area Assemblymen Chris Brown (R-Linwood) and Vince Mazzeo (D-Northfield), both of whom have fought against it.
Mazzeo said that adding more competition to an already oversaturated market “doesn’t make too much sense.”
“I believe that competition got Atlantic City in trouble in the first place and now we’re just creating more competition,” Mazzeo said.
Brown added that he believes “voters are smart” and will see through the promises being made by the northern New Jersey casino supporters. He noted that new customers aren’t being rapidly generated, meaning that casinos in northern New Jersey would simply be looking to grab Atlantic City’s players.
“We will cannibalize our own market,” Brown said.
Sarlo said that for years, he has voted for proposals to help Atlantic City and has seen tax revenue from northern New Jersey residents be sent to the city. Never, Sarlo said, has Atlantic City sent any money up north.
“My constituents are saying when is enough is enough?” Sarlo said.
Sarlo said that northern New Jersey casinos present “an opportunity to generate new revenue not just for the state of New Jersey, but a new revenue stream for the Atlantic City economy.”
“If this fails, it is a failure for the entire state,” Sarlo said.
McCarter English chairman talks market forecasting
Where digital interactions and e-commerce have become increasingly large parts of daily life, many lawyers have seen a new market and began to specialize in this area.Lawyers such as Judith Germano have started entirely new practices to address these issues.
But, according to the chairman of McCarter & English, Michael Kelly, law firms are constantly practicing forms of market forecasting.
Cyber security was just one part of that.
“The law, professionally, is very competitive and we saw this coming, as I’m sure other firms did, we prepared for it,” he said. “We always try to stay one step ahead of our competition and obviously try to do the best to service our clients.”
It may be easy to think of firms as reactionary, dealing with cases as they come, but Kelly said this type of market forecasting is essential to the health and growth of a firm.
And cybersecurity is a perfect indicator of that.
“For years, a lot of firms just say back and just continued business as is but, guess what, wake up because it’s a whole different world,” he said. “Any firm manager who’s not thinking where the market is going to be in the next 3 to 5 years is not doing their firm a service.
“We saw this coming and invested, just as we saw climate change coming.”
McCarter & English were ready to take on the growing cybersecurity market but, before any of that, they had to be able to walk their own talk.
“The first thing we did was make sure all of our software was as bulletproof as possible,” said Michael Kelly, the firm’s chairman. “Mindful of the fact that you can never have a 100 percent guarantee, we have state of the art software so that we could protect our own confidential material.
“But it’s almost like an antibiotic: you kill one bug, but the next is resistant.”
Estate tax not worth eliminating, according to think tank’s report
A new report released Wednesday by New Jersey Policy Perspective is questioning the wisdom of a recent legislative push to phase out the state’s estate tax, given that just 4 to 5 percent of all New Jersey estates are taxable annually.The report found that, except for Bergen County, there are less than 400 estates in each New Jersey county each year that are subject to the tax.
While many projections have estimated the tax to produce anywhere from $300 million to up to $400 million annually in revenue, NJPP has marked the revenue brought in by the estate tax at around $550 million.
As the report notes, the push to eliminate the tax comes as the state was recently faced with an unforeseen $1.1 billion budget shortfall over the next two years.
“Seeing how few people actually owe estate tax in each county reinforces the fact that wiping it off the books would benefit only the fortunate few and do actual harm to rest of New Jerseyans,” said report author and NJPP senior policy analyst Sheila Reynertson. “At a time when we get warning sign after warning sign about how broke New Jersey is, pulling $550 million a year out of our coffers is a big step in the wrong direction.”
Recent bills cosponsored by state Sens. Paul Sarlo (D-Wood-Ridge) and Steven Oroho (R-Sparta) are calling for gradually eliminating the estate tax over a five-year period and increasing the exclusion rates for retirement income exemptions, to as much as $100,000 in some cases.
The measure calls for the exclusion rate on the estate tax, which currently applies to inheritances valued at $675,000 or more, to be upped to $1 million beginning Jan. 1, 2017. The rate would then be increased annually until it is eliminated altogether.
The legislation has been widely celebrated by members of the state’s business community, who see it as a step toward making New Jersey more competitive with other states deemed to be more tax-friendly.
The NJPP report concludes that the state would be better served by raising its Earned Income Tax Credit program, which NJPP President Gordon MacInnes claims would offset tax breaks between well-off households and low-income and working-class households, yielding a better sense of “tax fairness.”
“Eliminating the estate tax in no way guarantees that elderly residents will stick around to enjoy New Jersey winters. That’s fantasy,” said MacInnes. “But raising the EITC guarantees immediate fairness for low-income and working-class New Jerseyans who would actually notice the hit to their wallets from higher fuel taxes, unlike the state’s wealthiest households.”
How does Rutgers’ accounting degree program stack up in new ranking?
When it comes to choosing a college at which to earn a bachelor’s degree in accounting, a would-be CPA could do worse than Rutgers University. A lot worse, in fact, according to the website College Choice.College Choice, a higher education search and rankings site, said the Rutgers program not only cracked the Top 50 nationwide, but ranked in the Top 10 at No. 7 overall.
“Regardless of whether students are interested in entering the workforce in a traditional business, a startup/entrepreneurial capacity or some combination of the two, an undergraduate major in accounting will not only give them a degree that is increasingly popular, but also in extremely high demand with employers in every sector of the business community,” Robert Hand, lead editor for the ranking, said in a prepared statement.
College Choice praised the Rutgers Business School for placing graduates at companies like New York Life and Johnson & Johnson, and for offering specialized programs such as public accounting, tax accounting and government accounting.
The University of Minnesota topped the list, followed by Brigham Young University and California State University-Northridge.
Rutgers was the only New Jersey college to make the list.
For the complete list, click here.