Amidst the controversy over New Jersey’s soon-to-expire economic development incentive programs, Gov. Phil Murphy traveled to the New Jersey Institute of Technology (NJIT), where he again criticized what’s in place now and promoted his plan for a new set of incentive programs for the future.
Speaking at NJIT’s Makerspace, Murphy said he called for a new incentives program 16 months ago, but the Legislature has sent him only a bill extending the existing programs, which he said only benefited the “wealthy and the well-connected.” He again vowed to veto the measure, but didn’t do so today.
New Jersey’s two main incentive programs, Grow NJ and the Economic Redevelopment and Growth Grant programs, are set to expire on July 1. The Legislature voted last week to extend the programs until Jan. 31 while working to replace them with programs the governor can agree to.
Murphy, however, said the existing programs have not delivered for New Jersey as a whole. While they were in place, New Jersey continued to rank among the worst in the nation on wage growth, poverty eradication and economic growth even as it was doling out incentives far in excess of competitor states. And those states were “eating our lunch” when it came to attracting business.
“Our current system of incentives was designed by a few to benefit the few,” Murphy said. “Its awards are grossly out of line with what our competitor states provide, and those states have been eating our lunch in economic development terms.”
NJBIA is open to new incentive programs and agrees with the governor on accountability and transparency when it comes to measuring their effectiveness. Nevertheless, NJBIA supported the extension so that New Jersey would not be without any incentive program, given how poorly New Jersey compares with surrounding states in its business competitiveness.
Murphy’s plan contains five components.
- NJ Forward, a jobs-based program to provide credits for companies engaged in high-growth industries and locating headquarters in the state;
- NJ Aspire, a place-based gap financing program to catalyze investments in commercial, residential, and mixed-use projects;
- Brownfields Redevelopment Program, using EDA’s Brownfields Loan Program to catalyze more remediation projects and increase job creation;
- Historic Preservation Tax Credit Program to reimburse developers who revitalize income-producing historic buildings; and
- Innovation Evergreen Fund to supercharge venture capital investment into startups.
He wants incentives to include startup companies and those that focus on innovation, not just trying to get established companies to move here. That was the significance of holding the press conference at Makerspace.
“We need to make New Jersey the place where these companies are born in the first place,” Murphy said.