By Hoboken Strategy Group
As 2014 winds down and we look ahead to the New Year, From the Halls of Trenton would like to end the year on some positive notes of interest to Hudson County as well as an outlook on some issues to be addressed in 2015.
Hudson County on the Rise
Recently the U.S. Census Bureau reported that Jersey City continues to be the state’s leader for new housing. According to Census figures, the City issued 1,286 permits for new housing units from January through the end of October with more than 1,100 of those for multi-family projects. Also topping the ranks is Secaucus with the third highest number of housing permits issued. Currently, a major rental project in Secaucus is being developed near the Secaucus Junction Rail Station. Statewide, home building in New Jersey is on track for its strongest year since 2006 with an 18 percent increase in permits issued in the past year.
New Jersey Incentives vs. New York
Since taking office last year, New York City Mayor Bill de Blasio has taken a strong stance against economic incentives for larger corporations. Last year, JP Morgan Chase cancelled a planned $6.5 billion office project in Manhattan as a result of New York City’s refusal to provide tax breaks. This Fall, Lieutenant Governor Kim Guadagno sent a letter to 275 financial services companies in New York and Philadelphia which detailed the benefits of commercial investment here in the Garden State.
According to a recent analysis in The Record, since the enactment of New Jersey’s Economic Opportunity Act (EDA), the New Jersey Economic Development Authority has awarded grants totaling more than $1.8 billion. This represented a 60 percent increase from the $1.1 billion awarded by EDA over the same period the prior year. As a result of New York’s reluctance to award incentives and New Jersey’s enhanced economic incentives, Jersey City has reaped the benefits. JP Morgan Chase received a tax break to retain 2,600 jobs and add another 1,000 jobs over 10 years as part of the expansion of their back-office operation in Jersey City. EDA has also awarded a $27 million grant to Forbes to move to Jersey City and a $79 million grant to RBC Capital Markets to remain in Jersey City and also add 900 new jobs that were previously housed in New York.
Looking Ahead to 2015
Recently, Assembly Speaker Vincent Prieto (D-Secaucus) announced his plans on introducing legislation that would consolidate the New Jersey Sports and Exposition Authority and the New Jersey Meadowlands Commission. According to Speaker Prieto, his proposal would consolidate the agencies to promote “efficiency of operation, cost-effectiveness and the elimination of unnecessary government bureaucracy.” The legislation would also re-establish the Hackensack Meadowlands Transportation Planning District.
Another component of the legislation would revise the Inter-municipal Tax Sharing Program within the 14 municipalities across Bergen and Hudson counties in which six of the municipalities would be relieved of their obligation to contribute to the program. The program’s purpose is to create a fair and equitable method of distributing the benefits and expenses of economic development and land use decisions amongst the municipalities. The Speaker’s legislation calls for the implementation of a 3 percent hotel use assessment received from all hotel room occupancies in the 14 municipalities. The communities of Carlstadt, Little Ferry, Lyndhurst, Moonachie, South Hackensack, North Bergen and Secaucus would continue to pay into the program while East Rutherford, North Arlington, Ridgefield, Rutherford, Jersey City and Kearny would receive an exemption but would still be eligible for benefits of the program. Funding will be authorized to assist in efforts such as flood control, traffic, renewable energy, infrastructure improvement projects, the promotion of the Meadowlands region as a tourism destination, the acquisition of property for open space preservation and the creation of parks and other recreational facilities. According to Speaker Prieto, “the bill positions the Meadowlands region for success…It’s a win for everyone.”
Coming Soon: Transportation Trust Fund Resolution
If you’ve been following our columns, you will know that New Jersey’s Transportation Trust Fund is on track to run out of funding by Summer of 2015. It is rumored that the Legislature will take up consideration of the future of the TTF prior to the Governor’s Budget Address in February.
In the past few months, New Jersey’s leadership has come to a consensus that the state needs to find ways to generate revenue to maintain and improve our state’s highways, bridges and mass transportation. While the exact details of a funding plan have yet to be revealed, one thing is for certain- it will not include additional borrowing. Funding solutions currently under consideration include a per-gallon gas tax increase, a 7 percent sales tax on motor fuel sales, an increase in car rental fees in the state, the dedication of online gaming revenue, or any combination of these possibilities.
In the Front Office, Governor Chris Christie has maintained that the state has to “find more revenue for transportation,” and that “everything is on the table.” Given the Governor’s presidential ambitions, any revenue increase signed into law by the Governor will more than likely not be labeled as a tax increase. Previous enactments have been referred to as “tax parity,” “fairness,” and “adjustments,” even though there had been an increase in fees for goods and services.
However it is framed, it is likely that there will be new revenue streams into the Transportation Trust Fund which may mean a higher price at the pump, but it will also generate the capital necessary to improve the way people statewide get around within the state.
Farewell 2014, Hello 2015
We hope you have enjoyed the first year of “From the Halls of Trenton.” From all of us at Hoboken Strategy Group, we wish you a very Happy Holiday and a healthy and prosperous 2015! We will be back in the New Year with more action “From the Halls of Trenton.”