Judge rejects Norcross effort to block tax credit report

June 18, 2019

TRENTON, N.J. (AP) — Shortly after a New Jersey judge ruled Monday that a report from Gov. Phil Murphy’s business tax incentive task force is in the public interest, rejecting political powerbroker George Norcross’ request to block its publication, the panel published its findings.

The governor’s task force said in a 75-page document that it found “special interests” had an impact on the 2013 law that designed the business tax incentives and that the state agency, the Economic Development Authority, did not have adequate procedures in place to ensure relevant information was discovered as grants were awarded.

The report’s release, originally set for June 11, followed closely a ruling on Monday by Superior Court Judge Mary Jacobson from the bench in her Trenton courtroom after a more than five-hour proceeding.

Her ruling against Norcross and firms with ties to him cleared the way for the task force that the governor appointed in January to investigate the state’s expiring business tax incentive program to release its report.

Norcross and the other firms that sued the Democratic governor along with him said in a statement before the report’s release that they would “continue this litigation in an aggressive manner.” They said they also planned to participate in legislative hearings on tax incentives.

The report also made nine recommendations. Among them was a call for future tax-credit legislation to be applied neutrally without favoring any specific business interests.

The report’s release and Monday’s ruling form the bench follow months of focus by the first-term Democratic governor on the tax-credit programs enacted by his Republican predecessor Chris Christie.

They also follow a 2017 auditor’s repor and a 2019 state comptroller report from earlier that criticized the state’s tax credit programs run by the Economic Development Authority for its failure to determine whether all firms granted awards met required benchmarks.

The programs have seen nearly $8 billion in credits awarded, though with just about $700 million paid out.

The comptroller’s report led Murphy to create a task force to investigate.

Jacobson found that the public should find out what the task force has discovered.

“The public interest is that this task force be allowed to go forth before there’s a vote in the Legislature,” she said. “I think the public has the right to know what the task force has found.”

Norcross and the firms also failed to convince her that they could prevail on the merits of their case — namely that the task force was invalid and should be disbanded. She said that was one of the tests the law required her to consider when considering whether to block the task force from issuing its report.

“I can’t grant a temporary injunction when I have concern that plaintiffs can prevail,” she said.

She also rejected Norcross’ attorneys’ claims that the task force was commissioned as an “accusatory” body and instead found it was there as a fact-finding panel.

Norcross and the firms argued that a May 2 hearing that raised questions about how Norcross and the firms got tax credits resulted in negative media articles and hurt their reputations.

“I understand there’s been lot of negative publicity,” she said. “The task force is not the media.”

Norcross is executive chairman of Conner Strong & Buckelew and chairman of the board of Cooper University Health system, both of which are party to the suit. Also suing the governor are The Michaels Organization, NFI and Parker McCay. The firms were mentioned by name during a May 2 task force hearing, as well as in the task force’s report.

Murphy has put forward legislation capping awards to businesses, among other changes.

Lawmakers haven’t taken up those wholesale changes and say they instead want to improve the current system. They backed legislation that would extend the program by six months.

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