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Jersey, sensing opportunity, eager to welcome NYC biz

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Jersey City is ready, willing and eager to welcome New York City companies.
Jersey City is ready, willing and eager to welcome New York City companies. - (FILE PHOTO)

It was late 2011 when it seemed that Fresh Direct could leave behind Queens, N.Y., for a new home in Jersey City — that is, until Mayor Michael Bloomberg stepped in with a $130 million incentive package, keeping the online grocer in the five boroughs.

If the company was making its decision a month from now, Jersey City Mayor Steve Fulop thinks the story might have a different ending.

On Jan. 1, New York City will swear in Bill de Blasio as its new mayor, following a campaign in which de Blasio swore off many of the aggressive economic development strategies used by Bloomberg during his 12 years in office.

“There's a window of opportunity for Jersey City,” said Fulop, who took office himself on July 1. “We have a new administration, we're situated in a great place, and there's a change that's happening in New York.

“So I think that, from our leadership standpoint, we would be foolish to not try to capitalize on it,” he said.

There may be a broader opportunity for New Jersey, experts say.

As of late last week, de Blasio hadn't openly discussed business policy since winning the election in November, instead focusing on assembling his transition team and top aides in City Hall.

But de Blasio gave several hints on the campaign trail over the past year, proposing a “broad reform of all tax breaks” that would likely divert funds from large companies and toward education and job training.

“It could be an era where New York City may not be as business-friendly as it's been under the Bloomberg administration,” said Paul Gevertzman, a New York-based accountant with Anchin, Block & Anchin, who specializes in incentive programs. “That remains to be seen.”

While “nobody is cheering for failure in New York,” Fulop said he has heard skepticism from the city's business community about the mayor-elect, and that's caused some companies to explore alternatives.

If de Blasio ends up being less dogged about job retention, Fulop said, it can only help New Jersey's chances.

Fulop said Jersey City already is moving aggressively to court new employers. Officials there plan to launch a marketing campaign aimed at reaching “across the river and in the region outside of Jersey City so that we could actually be attracting employers to come here.”

The city is finalizing a request for proposals for consultants and other services to help it develop the campaign, Fulop said. As of now, it has about $500,000 designated for the project, and officials hope to have the funds matched by the development community and some of the other companies in Jersey City, he said.

“The better that the city does, the better that we all do together,” Fulop said. “So I think we can stretch our dollars further … The goal is branding and marketing of the city, and I think we're in a good position.”

That's not to mention New Jersey's newly overhauled incentives, which can be lucrative for firms that move to urban, transit-rich locations, and the city's own tax abatement program. Fulop said the programs could play a key role in at least two companies “that are very, very close” to crossing the Hudson — businesses in the range of 250 to 350 employees.

Any change in how New York City courts businesses could mean that tax breaks offered by Albany will loom even larger. New York state recently added a new program to its arsenal — known as START-UP NY — which creates tax-free zones around higher education campuses to attract high-tech and startup companies.

But Gevertzman, the New York accountant, said the program still has limitations relative to the more inclusive incentives in New Jersey.

Still, experts say New York City has tools that may remain useful for economic development, even some that were underused during the Bloomberg administration.

Jay Biggins, a Princeton-based site selection consultant, said that includes the city's ability to offer sales tax exemptions for construction materials and purchases of equipment.

In the meantime, observers and business leaders will be watching to see how the de Blasio administration “intends to address its competitive challenges” after the refinements in New Jersey, said Biggins, executive managing director of Biggins, Lacy, Shapiro & Co.

“It will be a very interesting and very important development for the regional marketplace how (de Blasio) decides to compete,” he said. “That's a big question mark for this New York-New Jersey metro region.”

E-mail to: joshb@njbiz.com
On Twitter: @joshburdnj

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