News Column

New Jersey Tax Breaks $2.5B, Yet Economy Lags

April 4, 2013

Bob Jordan

New Jersey has provided more corporate tax breaks in the past three years than it did in the last 10, but the state's economy still continues to lag, according to a report released on Monday.

The state has awarded $2.1 billion in subsidies -- compared to $1.25 billion for the previous 10 years, since Gov. Chris Christie took office in 2010, according to a report by New Jersey Policy Perspective, the liberal think tank.

However, New Jersey's economy remains sluggish.

While its unemployment rate has fallen slightly, it is the sixth-highest in the United States at 9.3 percent in February, well above the national jobless rate of 7.7 percent.

New Jersey had the second-highest foreclosure rate in January at 7.2 percent, behind only Florida, according to CoreLogic, a leading provider of consumer, financial and property information.

"So far, efforts to spur economic growth through aggressively awarding subsidies have not borne fruit," the think-tank said in its report.

Michael Drewniak, a Christie spokesman, said the group was "not credible."

"This study simply fails to consider the disadvantage we'd be in without effective job retention and business-incentive programs," Drewniak said. He noted that both Democrats and Republicans have supported such measures.

Through the entire previous decade, the state awarded $1.25 billion in tax credits and grants.

The report, "New Jersey's Subsidy Surge Has Not Subsided," says corporate subsidies have gone to 171 projects since Christie took office in January 2010. But the report says the awarding of tax incentives by the New Jersey Economic "are often touted by members of both parties as effective job-creation tools."

Bayer Healthcare, Citibank, Pfizer, UBS Financial Services, Prudential Financial, Panasonic and Lockheed Martin are among companies receiving the largest taxpayer-funded incentives in the past three years, according to the report.

Source: (c)2013 Asbury Park Press (Neptune, N.J.) Distributed by MCT Information Services

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