Sunday, December 18, 2016

Lawmakers ignoring $7.4B boom in 'corporate welfare'?

New Jersey Governor Chris Christie

Salvador Rizzo reports for The Record:

At a time when New Jersey lawmakers are rushing a bill to end what they call “corporate welfare” for the news media, Gov. Chris Christie’s administration this month surpassed $7.4 billion in tax subsidies awarded to hand-picked businesses and nonprofits.

This historic boom in tax giveaways — one of the largest on record in the United States — has been facilitated by both parties in the Legislature during a years long financial crisis and a plague of revenue shortages. Some of the biggest grants Christie has doled out have benefited politically connected insiders. The cost for state taxpayers could grow by billions of dollars more before New Jersey’s main subsidy program expires in 2019.

Christie asserts that government bodies and private businesses would save $80 million a year by posting legal notices online, instead of printing them in newspapers, as New Jersey law currently requires. The governor’s office has refused to break down its cost analysis and has not provided supporting documentation requested by The Record under the Open Public Records Act.

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Meanwhile, the New Jersey Press Association said the cost of publishing legal notices is $8 million a year for taxpayers and $12 million for businesses, according to a 2010 study. Advertisement rates for legal notices are set by law, and they were last increased three decades ago. Publication of public notices in newspapers is hardly unique to New Jersey and has for nearly a century been an established method of communication for governments across the nation.

Whether it is $8 million or $80 million a year, the figure pales in comparison to the $7.4 billion in corporate subsidies Christie has awarded as of this month through the state Economic Development Authority, an agency tasked with creating and retaining private-sector jobs. This subsidy boom has been enabled largely by the passage of the bipartisan Economic Opportunity Act of 2013.

Conservative and liberal groups have criticized the explosion in tax breaks under Christie, calling it textbook “corporate welfare” and noting that the state has garnered a record 10 credit-rating downgrades because of a lack of revenue to cover the cost of hospitals, pensions, schools, property tax rebates and other services. State revenue is not keeping pace with New Jersey’s ballooning, legally mandated costs, analysts at Fitch Ratings, Moody’s Investors Service and S&P Global Ratings say.

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