The legislature is looking into developing an Economic Development and Task Force that will conduct hearings to fairly and transparently examine tax incentive programs in the New Jersey Economic Development Authority. The Senate has also the planned formation of a Special Committee for Economic Growth to do the same. Governor Murphy created a EDA Task Force as well to investigate mismanagement of $11 billion in tax incentives provided to businesses by the EDA.

“We are glad the legislature will create a task force to investigate EDA’s mismanagement of billions of New Jersey taxpayer money on projects that were not needed. EDA’s tax program is broken and needs to be fixed. The legislature should conduct an independent audit and investigation on who received subsidy money, how it was spent, and if any rules were broken. More importantly, of all the projects out there funded by the state, the biggest one of all that needs to be looked at is American Dream/Xanadu,” said Jeff Tittel, Director of New Jersey Sierra Club. “We had opposed this legislation from the beginning and called it sprawl fare, which is corporate welfare for developers. We are critical of legislation because we saw this would lead to a lot of pay to play and abuse and those things have come true. This legislation not only targets Camden and other places but environmentally sensitive areas around the state. What we saw in the bill has now actually come true.”

Senator Sweeney has not announced the member of the Special Committee yet, will be comprised of to-be-named Senators. The Assembly Commerce and Economic Development Committee will also hold hearings to scrutinize EDA tax incentive programs under direction of committee chairman Gordon Johnson. Gov. Murphy created the task force to investigate mismanagement of $11 billion in tax incentives provided to businesses by the EDA. The American Dream/Xanadu project received $350 million in direct state subsidies from EDA. Two public hearings have been held by the task force, with much of the focus on businesses in Camden that received a total of $1.6 billion.

“We have opposed the American Dream/Xanadu project from the start, and we were right. The state of New Jersey has been wasting a lot of the $11 billion in tax breaks and subsidies at the expense of critical programs that help the middle class and the environment. This is money that should be going toward open space and cleaning up toxic sites. The EDA program is a giant giveaway to corporations that don’t need it,” said Tittel. “Investigating what’s happening in Camden and other places is good, but the Senate and Assembly have to investigate American Dream/Xanadu.”

The American Dream/Xanadu mall sits partly on wetlands in an environmentally sensitive area prone to flooding. Meadowlands resources are important for flood control, fisheries, and migratory birds. The 3-million square foot retail and entertainment complex in the Meadowlands is supposed to open sometime later this year after many years of delays. The project is expected to add more than 150,000 cars a day to the region.

“The legislature should not let EDA be investing in a project so prone to flooding and so damaging to the environment. The American Dream/Xanadu site flooded during Hurricane Sandy. The area is increasingly vulnerable to the effects of sea level rise and storm surges. Studies have shown the entire area will end up under 3 feet of water. The EPA and Fish & Wildlife under President George W. Bush opposed the project because of environmental impacts on clean air and water, and wildlife,” said Tittel. The Senate and Assembly legislature special committees need to look at EDA’s own economic projections for the project, which do not support the incentives. They anticipate about 10,000 permanent full-time and part-time jobs from the mall, most paying less than $20,000 a year.

Governor Murphy said that that he will be capping some of New Jersey’s tax break credit programs for 2019. Murphy’s audit on the Economic Development Authority’s tax incentive programs and found that of the 48 projects and promised 15,000 jobs, 3,000 couldn’t be documented or were double counted.

“New Jersey won’t be able to fix the EDA program if we keep giving away billions of taxpayer dollars to the projects that don’t need it. The state needs to conduct a thorough independent investigation on major projects like America Dream/Xanadu and Honeywell in Morris Plains. New Jersey should not be making middle class taxpayers and the environment pay billions of dollars for corporate subsidies when there is little to no benefit from it. That money could be better spent for offshore wind or creating real jobs,” said Jeff Tittel, Director of the New Jersey Sierra Club. “Now that the Murphy Administration created an EDA Task Force and both the Assembly and Senate are creating their own legislative task force committees, it is critical that they investigate the American Dream Mall.”