Murphy conditionally vetoes 2 bills seeking tax credits for industries in Atlantic, Cape May counties

Governor cites concerns about Garden State Growth Zone program, which he said needs to be sunset next year

By Anjalee Khemlani
Trenton | Aug 27, 2018 at 10:12 am

Gov. Phil Murphy conditionally vetoed two pieces of legislation Monday that advocates said could spur economic activity in South Jersey.

Murphy conditionally vetoed a bill that would allow for tax credits per full-time employee and for capital investment at the National Aviation Research and Technology Park in Atlantic County.

Murphy also conditionally vetoed a similar bill that targeted the Cape May County Airport zone, which also has an industrial complex that has seen some business interest from drone startups and is the home of the Cape May Brewing Co.

The Atlantic County bill was one advocates have been pinning their hopes on to attract greater attention to the National Aviation Research and Technology Park.

In his statement, Murphy cites concerns about the existing Garden State Growth Zone program, which includes Atlantic City, and recommends it be sunset next year.

The program allows tax credits per full-time employee, and additional credits for capital investments.

“While I understand the desire of the sponsors to expand these programs further into Atlantic County, I continue to believe that we must fully examine the merits of these tax incentive programs in light of evidence that they have been less effective than those in (two) other states,” he said. “That is why my administration is engaged in a full review of these programs before they are scheduled to expire next year. I am therefore recommending that the proposed GSGZ sunset with the rest of the Grow NJ and ERG programs on July 1, 2019.”

Murphy did allow the Pinelands Development credit to stay in the bill, adding that he understands the need for development in the area — as long as it doesn’t interfere with protected open space.

“Pinelands preservation is required under law and should not be disturbed, but the Pinelands Protection Act need not prevent sensible development, especially if additional growth can occur without impacting open space,” he said.

The move by the governor was disappointing news Monday morning for stakeholders and bill sponsors.

Assemblyman Vince Mazzeo (D-Northfield), said the conditional veto of the bill’s attempt to address independent contractors shows a lack of understanding of the aviation industry.

“I think people have to have an understanding of how the aviation business works. When projects come about, they have to hire subcontractors,” Mazzeo said. “That’s why we put in the stipulation that they have to stay in New Jersey, so it benefits our economy.”

Mazzeo hopes that legislators and other advocates can instead sell those who hire the subcontractors on the long-term benefits of coming to Atlantic County and being part of the build-up of the park.

“We’ve been working on this bill for two sessions now,” Mazzeo said. “The first governor vetoed it. We’ve certainly had a lot of meetings with the Murphy administration. We understood he liked targeted action centers. You can’t get more targeted than this. We certainly thought we had a bill that was going to be satisfying for both sides.

“We didn’t get the whole pie, but we got a piece of it and we’re going to run with it and make it work for us.”

Murphy’s conditional veto of the bill that targeted the Cape May County Airport zone did not sit well with state Sen. Jeff Van Drew (D-Cape May Court House).

“I am profoundly disappointed that this bill was not signed into law,” Van Drew said in a statement. “South Jersey is hurting and needs this type of economic growth. We were finally able to find an industry that had the potential to grow in our state, we need these things.

“This was very personal for our area and would have had a substantial positive impact. South Jersey needs to diversify its economy. We cannot depend solely on tourism and casinos alone. This is a missed opportunity that would have helped South Jersey.”

Anjalee Khemlani | akhemlani@roi-nj.com | AnjKhem