State Street

Amazon may consider a more traditional route

April 16. 2012 3:00AM


While lobbyists and legislators wait to see whether Amazon.com wants to take the offer that's on the table to delay its collection of sales taxes, a new potential path for the retail giant has emerged.

A source indicated Amazon may apply for a Grow New Jersey incentive, which provides up to $40 million for a development in the state. Amazon has discussed bringing two distribution centers and 1,500 jobs to New Jersey.

If Amazon files an application for Grow New Jersey tax credits, it would be a signal that it may have abandoned legislation that would delay it collecting the sales taxes, since the bill that grants the delay also bars these companies from receiving state tax incentives.

The Assembly has passed bills that would increase the number of companies subject to collecting sales taxes for online purchases and would give companies like Amazon a break from collecting the taxes. The Senate has not acted on the bills, as lawmakers waited to see whether Amazon would support them.

The company's interest in the bills cooled over a provision that would have required it to follow prevailing wage laws, sources have said.

The source suggested Amazon may have been better served applying for state incentives in the first place, rather than asking for a legislative fix on the sales tax issue.

Economic Development Authority officials said Amazon has not applied for Grow New Jersey tax credits.

Incentives aplenty, but EDA gets clean review

While the state's incentive programs have come in for some criticism in recent months, the agency that oversees them — the EDA — has received a positive review of its financial reporting.

The EDA released its comprehensive annual report for 2011 on April 10. The report included the authority's audited financial statements for the year.

Accounting firm Ernst & Young issued an "unqualified" opinion of the EDA's financial statements, indicating it didn't have any negative findings. The firm also did not issue any comments recommending actions by EDA management.

The authority had a busy year in 2011, more than doubling the amount of total public and private investment in its projects, from $1.4 billion in 2010 to $3.4 billion in 2011. It has more than doubled the number of estimated new jobs created, from 5,200 to more than 13,000 in 2011, as well as the number of existing jobs that its programs support, from 12,350 in 2010 to 26,942 in 2011.

"This is an impressive document, which every year really sets the standard for entities within the state here, but really nationally," said EDA board Chairman Alfred Koeppe.

Both sides tout benefit of stance on ports subpoena

Whichever side legislators are on in the heated debate over subpoenaing Port Authority of New York and New Jersey officials, they claim their position will benefit the business community.

Both Democrats who favor the subpoenas — and paying for lawyers to counter efforts to squash the subpoenas — and Republicans who oppose a legislative probe, say they would save businesses money.

John Wisniewski (D-Sayreville), who chairs an Assembly committee on transportation, public works and independent authorities, said he wants to understand why the Port Authority has increased its tolls.

"I think the business community is concerned about the amount they pay the Port Authority," Wisniewski said.

He said truck drivers, port operators and delivery businesses all have been hit hard by the 50 percent toll increase. He added that he's concerned about the potential for future increases.

"This is not sustainable," Wisniewski said, adding that crossing the Hudson River has become cost-prohibitive for many, adding: "You need everything but a passport."

But Assembly Minority Conference Leader David Rible (R-Wall Township) said it's Republicans who are looking out for the interests of the business community.

Rible and his fellow Republicans focused on the unknown costs of issuing subpoenas and then paying for the legal defense against motions to quash the subpoenas. "It's about credibility," Rible said. "The business owners and the taxpayers of this state need to know that this house is acting credibly."

Republicans pointed out that Wisniewski had filed a Freedom of Information Act request in his role as the chairman of the Democratic State Committee over Port Authority matters. They asked him to step down as the chairman of the Assembly committee, a request he rejected.

Seeking support for a culture of innovation

Innovation New Jersey, a coalition of businesses and business groups aiming to foster an innovation-friendly environment in the state, is reaching out to legislators for support.

The nonprofit seeks to build stronger ties between industry and academic researchers, a goal that is shared by the Chris Christie administration. Its leaders are Haskell Berman, senior vice president of state affairs for the HealthCare Institute of New Jersey, and New Jersey Business & Industry Association Senior Vice President Melanie Willoughby.

Willoughby and other NJBIA representatives recently met with state Sen. Sandra B. Cunningham (D-Jersey City), chairwoman of the Senate Higher Education Committee, to discuss the initiative. She said Cunningham had a positive initial response to the group. "We were educating her about the coalition and the work we want to do with the higher education community," Willoughby said.

Innovation New Jersey officials are hoping to make a more detailed pitch to the entire committee in the coming months, but the effort has been temporarily delayed by the committee's total near-term focus on Christie's proposals to merge parts of the University of Medicine and Dentistry of New Jersey and Rutgers University, as well as Rutgers-Camden and Rowan universities.

Along with building ties between businesses and universities, Innovation New Jersey wants to increase collaboration between researchers at different universities.


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