The state Economic Development Authority voted Thursday to approve the third-largest tax credit in its history — a 10-year, $260 million award to Holtec International, a maker of equipment and supplies for the energy industry — for a proposal to build a 600,000-square-foot manufacturing and design center in Camden.
The company, which already maintains a corporate technology office in Marlton, told state officials the project would result in the creation of 235 new jobs and the retention of 160 jobs, according to the EDA. The capital investment totals $260 million, and Holtec executives said the tax credit is “a material factor in the company’s decision whether or not to locate the project in Camden.”
EDA President Tim Lizura said the 160 retained jobs would be coming from Holtec's Marlton location, but did not comment on the company's future plans for that site.
Holtec is now choosing between the South Jersey city and “a lower-cost option” in South Carolina, EDA officials said. If the company picks New Jersey, it would enter a ground lease with the South Jersey Port Corp. for land on the South Camden waterfront, to be located at 2500 South Broadway.
EDA officials estimate a total net benefit to the state of $155,520 over 35 years.
Holtec also operates other locations domestically in Florida, Pennsylvania and Ohio, as well as overseas in India and Ukraine.
The approved tax credit places just behind the $261 million award slated for Revel in 2011 and the larger $390 million award approved last year for the American Dream project in the Meadowlands. And the award was boosted by several of the bonus triggers created by last year’s Economic Opportunity Act, which overhauled the state’s business incentives and carved out many extra benefits aimed at luring business to Camden.
It also follows last month’s 10-year, $82 million tax credit offered to the Philadelphia 76ers to have the team build a new practice facility and headquarters in Camden, one that renewed the debate over the state’s use of corporate incentives.
Gordon MacInnes, president of liberal think tank New Jersey Policy Perspective, sounded off on Holtec's award Thursday, calling it "part of a much larger, troubling trend."
MacInnes said legislators should revisit the Economic Opportunity Act and explore placing a cap on the amount of subsidies the state can approve.
"Despite the lack of results and the fact that there's no evidence that tax breaks will grow a state's economy, New Jersey's leaders decided last year to double down on this single-minded strategy by passing the Economic Opportunity Act," he said. "We're now seeing the fruits of that legislative overhaul in the form of even more extreme increases in the volume of subsidies approved, the size of individual tax breaks and the cost to taxpayers per job."
However, Lizura defended the practice Thursday, noting that the project's estimated net benefit was carefully analyzed and the proposed award "strictly follows the legislation."
"It follows the statute, so whether people agree with it or disagree with it, it’s what the legislation says," Lizura said.
Also in attendance Thursday was Camden Mayor Dana Redd, who said a more formal announcement introducing Holtec to the city will be made next week. At that time, plans for pairing Camden residents with the new jobs that will be provided by the project will be discussed, she said.
Redd noted the Economic Opportunity Act as playing a major role in the company's interest in Camden.
"This is just part of our efforts to move Camden forward," Redd said.
Holtec President and CEO K.P. (Kris) Singh has reported ties to South Jersey power broker George Norcross, as he sits on the board of trustees for Cooper University Health Care, which Norcross chairs. Similarly, according to Norcross’ profile on the website of Conner Strong & Buckelew, which he also chairs, he is listed as serving on Holtec’s board of directors.
Singh was also a member of the group of business leaders led by Norcross that purchased the Philadelphia Inquirer and Daily News in 2012. Norcross and two partners were outbid in May in a court-ordered private auction for their majority ownership stakes.
Asked if Norcross played any role in the procurement of the award for Holtec, Lizura said he was "not aware" of it.
Holtec’s focus is in the fields of nuclear, fossil, solar and geothermal energy, and it is the largest provider of storage and transport systems for spent nuclear fuel in North America, according to the EDA memo. The company also designs and supplies steam generators, surface condensers and other equipment for the global power industry.
Since 2009, Holtec has been developing a new small, modular nuclear reactor that will provide power to 1.75 million people globally, the memo said. The company’s new state-of-the-art manufacturing facility and design center would support components of the reactor and the expansion of its current line of products.
The company will not generate, transport or store nuclear fuel at the proposed facility.
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