In mid-June, Site Selection Executive Vice President and General Manager Ron Starner interviewed New Jersey Gov. Chris Christie by email:
Site Selection: What are your top three economic development priorities this year as Governor of New Jersey?
Gov. Christie: Our priority is to position New Jersey as a pro-investment state, responsive to the needs of corporate site selectors and the clients they serve by establishing a favorable tax climate with competitive business incentives, a common-sense, predictable regulatory process and highly motivated business advocacy. A recent statewide survey of New Jersey CEOs released in May 2011 provides further evidence that our efforts to make our state a better place for business expansion and job creation are paying off. Seventy-five percent of survey participants said our state government has become more responsive to the needs of business over the past 6 months. Only 30 percent of respondents expressed this sentiment when the survey was last conducted in the fall of 2009.
It's no coincidence this recognized improvement coincides with a new and refreshing approach to economic development that emphasizes real, tangible cuts in government spending and tax policies aimed at incentivized growth. Over the course of two consecutive budget cycles, we delivered significant tax improvements such as allowing the Corporate Business Tax surcharge to sunset, moving to a single sales tax factor and permitting net operating losses from certain business-related categories to be carried forward for up to 20 years
Reforming our state's burdensome regulatory maze has earned New Jersey national recognition. In my first days in office, we quickly enacted "common-sense principles" for rulemaking and permitting across state government to make the regulatory process easier and more accessible. This was a critical first step. However, the task of streamlining government is fluid and requires constant vigilance. The ongoing Red Tape Review Commission will ensure that New Jersey remains as a national model in enacting responsible regulatory reforms. It will also build upon a record that has witnessed a decline in the size of the New Jersey Register, the publication of adopted and proposed regulations, from over 7,000 pages in 2008 to approximately 3,000 pages at the end of 2010.
Complementing our policy successes are our promotion initiatives to market New Jersey's significant assets from our network of roads, strong industry clusters, reliable energy and world class work force to our aggressive business advocacy. We created the New Jersey Partnership for Action as the centerpiece of our coordinated and streamlined economic development strategy that aligns the comprehensive approach to delivering business services through advocacy, access to financial resources and domestic and global marketing to retain and attract businesses. Overseen by Lt. Governor Kim Guadagno, its three distinct components - Choose New Jersey, the Economic Development Authority (EDA) and the Business Action Center (BAC) - work together on a daily basis to enhance New Jersey's appeal to businesses, not only by marketing the state's strategic unique advantages, but in providing the timely and seamless delivery of key economic development services through emphasis on stakeholder outreach, continuously improving an already successful portfolio of economic incentive programs, while expanding our presence in the competitive 21st century global marketplace.
Our efforts are being affirmed by real transactions. Eight Fortune 500 companies have decided to remain and/or expand in New Jersey. And 25 other businesses have either relocated to New Jersey or planned to relocate from New York, Pennsylvania, Maryland, North Carolina, and Tennessee. Small to mid-sized businesses once more have optimism and faith that New Jersey is again a "home for growth."
SS: What is the biggest roadblock facing New Jersey in terms of making the state more appealing to corporate site selectors?
Gov. Christie: I saw a study recently that said corporate site selectors think New Jersey falls short in tax burden and operating costs. And, no doubt, New Jersey has historically had challenges in those areas. But my administration has made it a priority to transform our state's previously hostile business climate. Real changes have been made to the tax code to reduce the financial burden on businesses and encourage greater investment, at a time when other states have actually increased that burden. And I established a red tape review process through the Business Action Center to streamline bureaucracy and greatly improve the experience businesses have in our state. We're moving things in the right direction.
At the same time, New Jersey's business incentives are as competitive as they come. No other state can match what we offer. As an example, with our Urban Hub Tax Credit program, a company may qualify for as much as a 100-percent tax credit. You just can't beat that.
Bottom line, we're moving in the right direction. And with the changes we've made over the last 18 months, New Jersey is primed and ready to compete with any state or region for business development. And we are eager to work with the site selection community to make these goals a reality.
SS: Is your tax code where it needs to be in order for New Jersey to compete with the rest of the country for jobs and industry?
Gov. Christie: I am committed to making important reforms in order to break from the state's difficult business climate, while maintaining fiscal discipline over state spending. Already we've closed an $11-billion budget deficit without tax increases and passed a hard 2-percent property tax cap to bring real property tax relief. Additionally, my administration has continued to advance policies that will improve New Jersey's business climate by protecting businesses from an average $400 per employee, or 52 percent, increase in the unemployment insurance payroll tax.
Most recently, I signed into law significant changes to New Jersey's corporate business tax formula from a three-factor formula to a single sales factor formula. We have more work to do, but these policy changes all demonstrate that New Jersey is well-positioned for business expansion, economic growth and job creation.
SS: New Jersey passed some landmark incentives legislation last year. How do you see these new bills working, and are more changes needed?
Gov. Christie: In 2010, my Administration actively advanced amendments to our Business Retention and Relocation Grant (BRRAG) program aimed at retaining jobs in New Jersey. The original program offered a one-time, $1,500 per jobs tax credit, and was deemed to be underutilized. We asked the business community what they needed and, as a result of that input, developed a program offering tax credits for up to $2,250 per job for up to six years. We did this without raising the annual $20-million cap on the program. As with any program, we are willing to listen to the experts in the marketplace to continuously improve our business incentive programs and other services to enhance New Jersey's competitive advantages and support site selectors to best serve their clients. It is from groups like yours and other stakeholders that we generate the kinds of innovative ideas like the revised BRRAG program that support our efforts to position New Jersey as the destination state for business investment.
Another example of positive changes we advanced were the enhancements through the Offshore Wind Economic Development Act. The new law creates an offshore wind renewable energy certificate program and provides financial assistance and tax credits to businesses that construct manufacturing, assemblage and water access facilities to support the development of offshore wind projects. Through the legislation, the New Jersey Economic Development Authority (EDA) will provide financial assistance to qualified offshore wind projects and associated equipment manufacturers and assembling facilities. Specifically, a business may be allowed a credit of 100 percent of its capital investment in a qualified wind energy facility located within an eligible wind energy zone. The value of credits approved by the EDA may be up to $100 million, an allocation that is part of the $1.5-billion tax credit allocation under the existing Urban Transit Hub Tax Credit.
In early June, Gov. Christie announced an overhaul of the state's 10-year energy master plan, scaling back the amount of electricity to be obtained from renewable sources like solar and wind power from 30 percent to 22.5 percent by 2021.-Ed.
SS: What was your role in convincing Panasonic to retain its North American headquarters in New Jersey?
When we learned that one of our largest employers, Panasonic Corporation of North America, was planning a relocation project that could potentially mean the company would move its U.S. headquarters to California or New York, my economic development team immediately got involved. This included personal outreach from me and the Lt. Governor to the CEO of the company, Joe Taylor., My message to him was very simple … "I am committed to nurturing and sustaining economic growth in this state and we are constantly working to create solutions that will cut the costs associated with doing business in New Jersey. The State of New Jersey truly values your company and your employees."
SS: How will the newly configured Choose New Jersey initiative help your state grow and prosper?
Gov. Christie: In the early days of my Administration, we developed a strategy to revitalize the economy called the Partnership for Action. We think the key to the Partnership for Action's success is that the three entities (Choose New Jersey, the New Jersey Business Action Center and the New Jersey EDA) are true partners working toward a common goal with a united vision.
Choose New Jersey, an independent, privately-funded and managed organization, was created to aggressively promote New Jersey as a place in which to invest and do business. Chaired by Dennis M. Bone, president of Verizon New Jersey, and led by CEO Tracye McDaniel, Choose New Jersey will market New Jersey to attract and retain job creators and provide policy recommendations to make New Jersey a home for growth. Choose New Jersey will advocate the state's core strengths - strategic access to local and global financial markets, a highly-trained and educated work force, and a comprehensive distribution network of world-class sea and airports, state-of-the-art energy and communications infrastructure and elite research universities.
The organization will maximize its resources to make New Jersey a competitive place to do business without increasing the burden on taxpayers.
SS: Work-force training is always a critical issue for corporate executives. What reforms, if any, does New Jersey need to undertake in this area?
Gov. Christie: Keeping our work-force, education, and training initiatives up to date and in tune with the needs of businesses requires a high degree of collaboration and means bringing together our higher education, Labor and Workforce Development programs and the employer community. Developing this vital collaboration is something we are working on right now.
New Jersey is creating statewide Talent Networks focused on six key industry clusters in the state. Each network will serve as a nexus connecting employers, job seekers, educational institutions, and the state's work-force development system. Through the Talent Networks, New Jersey is engaging employers within these sectors to help, not only to connect qualified workers with employment opportunities, but also to provide us with the input and insight needed to shape higher education, training and worker development programs that will assure that New Jersey has the properly trained and qualified workers whose skills match the real needs of employers in that key sector.
The first six industry clusters on which we are focusing are Transportation, Logistics and Distribution; Life Sciences; Advanced Manufacturing; Financial Services; Health Care; and Technology / Entrepreneurship.
Another vital element in our work-force development efforts is implementing an industry-focused approach to developing and sharing timely and useful work-force and economic intelligence. This key data will help employers guide their businesses and hiring decisions, steer workers to the right jobs and support the efforts of our work-force development initiatives to keep them homed in on present and emerging skill needs.
The other key piece of the puzzle is to connect the workers and employers with this important economic and work force information and to connect the right worker with the right opportunity by matching their skills with the needs of employers. To help make those connections easier, we recently established the Jobs4Jersey Website (www.Jobs4Jersey.com) to guide jobseekers and employers to appropriate information and hiring opportunities.