By David Levinsky - www.phillyburbs.com
FLORENCE — Burlington Coat Factories executives and state lawmakers wielded golden shovels Friday as they broke ground on a new 215,000-square-foot corporate headquarters to rise next to the retailer’s current building and warehouse off Route 130.
But the real work occurred months earlier when state officials negotiated a deal to award the company more than $40 million in tax credits over the next ten years in return for its pledge to stay in Burlington County rather than move to a proposed site in Bensalem, Pa.
Without the incentive package, officials said the groundbreaking would have occurred out of state rather than on the 50-acre plot in Florence.
“What you see here could have happened today in Pennsylvania but for the bipartisan support for business incentive programs in New Jersey,” acting Gov. Kim Guadagno said Friday at the onset of the ceremony.
With that in mind, state lawmakers said they are now putting the final touches on legislation to both renew and revamp the tax incentive programs they claim were so crucial to keeping Burlington Coat Factory and other businesses in the Garden State.
The legislation, known as the Economic Opportunity Act, would consolidate the five major tax incentive programs overseen by the Economic Development Authority into two programs. The Economic Redevelopment and Growth Grant Program would specialize in redevelopment help, and the Grow New Jersey assistance program would be dedicated to business attraction and retention.
In addition to simplifying both programs, the bill aims to boost the amount of money available and make it easier for smaller businesses from rural and suburban areas to qualify for the incentives offered.
Assemblymen Herb Conaway Jr. and Troy Singleton, who are both sponsors of the Economic Opportunity Act, said the goal is to continue to help businesses like Burlington Coat Factory grow and succeed.
“We’re always looking for ways to help businesses create jobs,” Conaway, D-7th of Delanco, said Friday at the groundbreaking. “We want to make sure we’re competing with Pennsylvania, New York and Delaware to keep jobs here.”
Burlington Coat Factory received its tax credits through the Grow New Jersey program, which provides credits to businesses that make capital investments which create or retain jobs in the state.
Since being signed into law last January, a total of $428 million in tax credits have been awarded to 16 projects, resulting in the creation of 1,725 jobs and the retention of nearly 6,000 more.
The jobs saved included 1,000 high-paying engineering and computer programs jobs in Moorestown that were spared by Lockheed Martin after it received a $100 million defense contract to continue its work on the Navy’s Aegis missile defense system. The company’s bid was aided by capital improvements the company pledged to make at its Moorestown plant with $40 million in tax credits from Grow New Jersey.
Because Grow New Jersey and the EDA’s Urban Transit Hub program are capped at a combined $1.75 million, action by the Legislature is needed soon to renew the program in order to allow the EDA to continue to offer the incentives.
Although the bill to renew and expand the program has been on a fast track to passage since its introduction in January, it hit a speed bump Thursday when it was held by the Assembly Budget Committee so that additional revisions could be made to make sure businesses across the state can qualify.
Singleton, who also attended the Burlington Coat Factory ceremony, said the changes would be minor.
“We want to make sure it’s completely inclusive to all of the state,” Singleton, D-7th of Palmyra, said. “I’m confident it’ll be approved and get us moving forward.”
Conaway agreed and said he expected the measure to get approved by both the Assembly and Senate before the Legislature’s summer recess.
“I’ll be very surprised if we don’t. Everyone knows how important it is,” he said.
Officials said the programs are expected to reach cap later this spring so the Legislature will need to act quickly if lawmakers want to keep providing incentives.
Christie, who rarely comments on legislation before it reaches his desk, has also voiced support for the bill, saying it would both continue and expand the successful Grow New Jersey program.
Despite the bipartisan support, the measure has been panned by some environmental groups, who believe the incentives create few if any new jobs and promote development on New Jersey’s little remaining open space.
“This is the biggest corporate subsidy anywhere in the country,” Jeff Tittel, director of the New Jersey Sierra Club said in a statement. “It gives billions to developers to pay over our last remaining open spaces. The legislation will not benefit the people of New Jersey, only the wallets of politically connected developers.”
Guadagno, who was serving as acting governor at Friday’s groundbreaking because Christie was outside the state, pointed to the $165 million in net benefits the Burlington Coat Factory project is expected to produce in tax revenue from the 626 existing jobs retained at the new HQ and the additional 120 new full-time jobs that will be housed there.
She said the incentives also send a message to businesses that the state is willing to fight to keep them here.
“This governor doesn’t take ‘no’ lightly and he doesn’t want businesses to leave New Jersey without a fight,” Guadagno said.