JPMorgan Awarded $188M N.J. Tax Break To Move To Jersey City

Last week New Jersey’s Economic Development Authority approved $190 million in tax credits over a 10-year period for JPMorgan Chase to relocate its headquarters to the state.The incentive agreement calls for $18.8 million per year, including $8,734 per job.

The company’s relocation will create 2,150 technology jobs for its Jersey City campus, bringing the total to 7,000 jobs in New Jersey, according to the EDA. As part of the tax credits, the company will receive more than $1.1 billion in tax benefits through the program. JPMorgan also agreed to invest more than $76 million to expand its Jersey City location. All told, the project is expected to generate $665.5 million in new revenues for the state over a 20-year period.

This new tax credit for JPMorgan comes after a $225 million “Grow New Jersey” grant given to the company in 2014, which called for 1,000 new jobs, with 2,612 jobs retained. However, as part of the stipulations of the deal, JPMorgan must fulfill its promise of 1,000 new jobs before it receives the new tax credit. According to JPMorgan spokesperson Andrew S. Gray, the company turned to New Jersey after New York City rejected hundreds of millions of dollars in proposed tax credits.

“Obviously, the proximity to the city, it’s closer in terms of relocation, that’s certainly a consideration,” Gray commented. “But the Jersey City package “proved to be the most economically viable for us, so that’s why we moved forward.”

The EDA reported that JPMorgan will maintain its current jobs in Jersey City, New York City, Delaware and Ohio, but all new positions will go to the Jersey City location. This tax credit program received bonuses because the median salary at the Jersey City location is $164,000, exceeding the median income level for Hudson County. However, the company also received bonuses for transit-related developments and for the number of new jobs it will create with the credit.

Criticism

The tax credit has come under criticism from local Democrats and left-learning organizations because it was among $300 million handed out to major corporations, including $27 million to keep Jaguar Land Rover North America in Mahwah and $5 million to attract Peeq Imaging LLC to Carlstadt. This corporate tax subsidy program is a rapidly growing initiative by Governor Christie, according to Jon Whiten, Deputy Director of New Jersey Policy Perspective.

“But these subsidies aren’t just getting bigger, they’re becoming even better deals for corporations, which have to do less than ever to receive massive breaks,” Whiten commented.

New Jersey has awarded more than $6 billion in subsidies since Governor Christie’s tenure in office as a way to lower the cost of conducting business in the state.