The question was asked during Newark Mayor Ras Baraka’s bus tour of the city, which detailed insights of Newark’s proposal to Amazon for its HQ2 headquarters with a dozen or so journalists.
“Is the state’s $7 billion offer of tax incentives too much?”
The mayor didn’t hesitate.
“If you take my perspective, I would say $7 billion is not enough to invest in a city like Newark,” he said.
This wasn’t a money grab, a statement that said the city wants all it can get and more. It was based on rational thinking, with a note of history.
“You’re talking about a community that has had no investment in 50-60 years,” he said. “There’s been a red line going around the entire community.”
That community, Baraka said, is now the key to the state. These incentives, he said, benefit far more than just his city.
“The trend in America is reversing back to the cities, that you have to invest in these cities to see the economy of the state grow, the economy of the country grow,” he said. “You have to employ thousands of people who have never been in the labor pool. You have to invest in an economy that has been sluggish because there’s been no investment. I think that’s something that you should be doing.
“So, the return on investment is what are we going to get for that, which is important. So, if you invest $7 billion to get nothing, then it’s a mistake. But if you’re investing it to create jobs and create wealth that will go back into the economy, you create property taxes and payroll taxes that go back into the economy and allows people the opportunity to have better lives and move on into the middle class.”
Baraka knows others don’t share his view. That others don’t see how a state can offer that much at a time it has so many struggles.
(READ MORE from ROI-NJ on the bus tour.)
“New Jersey has a plethora of issues, economically,” he said. “So, that becomes a main argument, ‘Why do we want to give this company this much money?’ And I understand that. And I understand the sensitivities around that as well. But my perspective is, we need somebody to invest something in this community. If we have to, to at least get them to the table by saying that, then let’s do it. We talk, we negotiate and we figure out how New Jersey benefits from this.
“Ultimately, I think, when they did the mathematics, they showed that the state would make a considerable more amount of money than they would invest. In terms of the economy, it comes out to a net positive.”
And not just for Newark and New Jersey, Baraka said.
“New York benefits if Amazon is here,” he said. “Every city in the state of New Jersey benefits if Amazon comes here. Even Philly benefits.
“All these people benefit with Amazon choosing to come to the East Coast with that much investment, that much development, that much business.”