The Economic Development Authority's director responds to an editorial's contention that a program may be 'poaching' jobs for Camden from its close-in suburbs.
By Melissa Orsen
In response to the South Jersey Times' March 19 editorial, "Are state-aided job shifts to Camden other towns' loss?" the New Jersey Economic Development Authority (EDA) would like to familiarize the editorial board and Times' readers with the law governing the Grow NJ program.
Grow NJ is a legislatively-created, state tax incentive program designed to encourage job creation and retention in New Jersey. The EDA is charged with administering the program, and does so in strict compliance with statutes and regulations.
With regard to the editorial's wholly misguided statements about the EDA Board -- stating that it "rubber-stamps" commercial applicants' Grow NJ requests -- we are proud to have an engaged and dynamic board serving with integrity as the foundation by which members act.
The EDA evaluates each Grow NJ application on its specific merits and to determine eligibility as defined by statute and regulation. This includes meeting minimum capital investment and job-creation or job-retention requirements. The EDA also conducts a comprehensive net-benefit analysis to ensure that approved projects will result in a net positive impact to New Jersey. Only proposed new jobs and jobs that are at risk of leaving the state are included in this analysis.
Following staff due diligence and thorough discussion at the board committee level, projects that meet the requirements progress to the full board. To date, approximately 50 applications have been withdrawn or were deemed ineligible before advancing to the board. Countless more never reached the application stage because, after consultation with staff, the companies themselves concluded that they would not qualify.
The Times and its readers must also understand that Grow NJ is performance-based. While board approval of a project represents the opportunity to realize tax credits, companies must certify that they have satisfied the specific requirements before they receive any funds. In short, approved projects must first generate new tax revenue, complete capital investments, and hire or retain employees. To date, 37 projects that were initially approved by the board were later withdrawn, largely due to an inability to meet the requirements of the approval.
With respect to the editorial's statements concerning relocation of jobs from one town in New Jersey to another nearby town, Grow NJ has provisions that specifically allow intra-state job transfers. In these instances, the EDA Board makes a separate determination to verify that the jobs to be transferred are at risk of leaving the state, and when they would be expected to leave. Regarding projects in Camden and Atlantic City, CEOs must certify that the provision of tax credits is a material factor in their businesses' decision to invest and locate in those cities.
Through the "Economic Opportunity Act of 2013," the Legislature provided for the highest level of incentives to expressly support investment in designated Garden State Growth Zones (GSGZs) including Camden, Atlantic City, Paterson, Passaic and Trenton. The statute affords Camden, and more recently, Atlantic City, with distinct benefits in order to spur economic activity in these cities that have uniquely suffered from years of disinvestment.
It is important to point out that Grow NJ was also created to promote development in the eight South Jersey counties. This objective is made clear in policies that include reduced capital investment and employment eligibility requirements not only for GSGZs, but for Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Ocean and Salem counties.
EDA is pleased that this provision has been effective, as more than 42 percent of Grow NJ tax credits approved to date support projects in the South Jersey region. These include Barrette Outdoor, a company that chose to expand in Galloway Township instead of Tennessee, creating an estimated 270 new jobs. Another example is Bayada Home Health Care's expansion in Pennsauken, which will result in an estimated 162 new jobs and the retention of 357 jobs that were at risk of being relocated to Pennsylvania.
The fact remains that the City of Camden continues to be one of the most distressed cities in the United States. Following decades of disinvestment and economic decline, a comprehensive strategy is now working to spur Camden's resurgence, including Grow NJ and billions of dollars of new private-sector investment.
Camden is on the rise and that is good news for the city, the region and the entire State of New Jersey.
Melissa Orsen is chief executive officer of the New Jersey Economic Development Authority.
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