The cost of foreign trade missions like the one Gov. Phil Murphy is on this week to India has always been watched closely back home because taxpayer dollars are spent whenever governors go overseas seeking new business and trade opportunities.
But keeping track of all the bills run up overseas is no easy task these days.
For starters, in recent years governors, including Murphy, have been letting outside groups that do not have to abide by the state’s public-disclosure laws bankroll their trade missions, making it impossible to know their true cost. Security concerns have also limited the release of detailed information about the cost of sending the governor’s taxpayer-funded state police security detail overseas.
As a result, taxpayers have little understanding of exactly how much these overseas trips cost, which makes it difficult to assess claims they are providing a good return on investment. Moreover, funding from outside groups — ostensibly easing the use of taxpayer resources — is raising new questions about transparency and what those groups, or perhaps their donors, think they are getting in return.
Sweeney wants more transparency
At least one top state lawmaker is suggesting it may be time for more disclosure.
“We should know who’s paying for it,” said Senate President Steve Sweeney (D-Gloucester) during a recent interview.
To be sure, going on overseas trade missions is a time-honored tradition that goes back decades for New Jersey governors from both parties. Israel — a key state trade partner — has been the most common destination over the years. Murphy carried on that tradition last fall when he traveled to Israel and Germany.
During that trip, Murphy announced in Jerusalem a partnership with Israel’s Innovation Authority that was intended to forge stronger ties to Israel’s tech sector. He also visited the Hamburg offices of an offshore-wind company that has a small presence in Jersey City.
The trip to India is a seven-day, six-city trade mission that the Murphy administration has billed as an opportunity to strengthen the state’s economic ties with the world’s second-most populous country. Joining the governor on the trip, which will extend from September 13 to 22, are Joe Kelley, his deputy chief of staff for economic growth; Tim Sullivan, the chief executive officer of the Economic Development Authority (EDA); and Wesley Matthews, the leader of the EDA’s Office of International Trade and Investment, according to Murphy’s office.
Like last year’s overseas mission, the governor’s office said the bulk of the expenses for Murphy and the administration officials with him are being picked up by a group called Choose New Jersey, a nonprofit organization that isn’t officially a part of state government, but whose main mission is to promote New Jersey’s strengths when it comes to economic development. Jose Lozano, the president of Choose New Jersey, and other organization officials are also traveling with the governor in India, Murphy’s office said.
Choose New Jersey was founded in 2010, and it often funded former Republican Gov. Chris Christie’s numerous trade missions during his eight years in office. Among the group’s biggest supporters are major corporations like Horizon Blue Cross Blue Shield of New Jersey, PNC Bank and PSEG, according to its website. Groups can contribute from $10,000 to $150,000 annually to Choose New Jersey, and the organization’s website indicates many New Jersey-based companies, labor unions and colleges and universities have done so.
Choose New Jersey is registered under federal Internal Revenue Service rules, and those rules do not require a more thorough disclosure of all donations, or a complete listing of all expenses it covers for each official gubernatorial trade mission. And thanks to a 2017 Appellate Court ruling, Choose New Jersey is not required to respond to more formal requests for information through the state Open Public Records Act, even as it has taken on the role of funding the official trade missions.
No answers to NJ Spotlight questions
Choose New Jersey did not answer a list of questions from NJ Spotlight, including how much trips like Murphy’s mission to Israel and Germany ended up costing, and what benefit the organization and its supporters realize by bankrolling the governor’s foreign travel. Instead, it issued a short statement.
“The Choose New Jersey events and delegation travel to India is privately funded,” the statement said. “This historic seven-day, six-city economic mission trip will further strengthen economic ties and attract more Indian businesses to invest in New Jersey. Given the tremendous cultural and economic synergies between New Jersey and India, we are confident that this delegation’s mission will deliver concrete economic benefits for our state.”
Meanwhile, state taxpayers are still footing at least part of the bill for overseas trade missions thanks to the requirement that Murphy’s official state police security detail stay with him at all times, including when he travels to foreign countries.
Asked for an accounting of all security costs for last year’s trade mission, as well as any estimates for what this month’s trip could end up costing taxpayers, the governor’s office suggested NJ Spotlight fill out a formal public-records request. A response received several days later from the governor’s office did not include a precise rundown of all those items, citing “security risk exemptions” for the governor’s security unit expenses that were defined in a 2015 court ruling.
But the response from the governor’s office did disclose monthly and quarterly travel expenses the security unit billed to a credit card, including for the period when Murphy was in Israel and Germany last year. The quarterly expenses totaled $130,156, and the monthly bill for October 2018 was $67,763, according to the governor’s office.
Speaking about this month’s trip during a recent public event in South Plainfield, Murphy said India is a natural place for New Jersey officials to visit given the state already maintains strong economic ties with India. He also said New Jersey has one of the nation’s largest Asian-Indian populations, topping 400,000, with many running small businesses that have contributed to the state economy.
“I’m incredibly excited to make the trip,” Murphy said. “I am excited about the possibilities.”
Christie touted similar economic goals for each of the trips he took while in office, including missions to Canada, Israel, Mexico and London. But his travel was also widely questioned in the run-up to a presidential campaign, with critics saying the overseas trips had as much to do with burnishing Christie’s foreign-policy credentials as they did with boosting the New Jersey economy. By some estimates, Christie’s regular out-of-state travel was costing New Jersey taxpayers about $60,000 each month on average in the run-up to 2016.
Even after dropping out of the 2016 presidential contest and endorsing Donald Trump, Christie continued to hear criticism for making New Jersey taxpayers fund the cost of the state police security details during subsequent political trips after he became an enthusiastic Trump supporter. In fact, state lawmakers eventually drafted legislation that sought to prohibit any public funds from being used by a New Jersey governor “when traveling out of State and engaging in political activities and not activities directly related to the Governor’s regular and official duties.” (Their bill never made it to Christie’s desk.)
McGreevey tripped up as well
While Christie was accused of abusing taxpayer resources for political purposes, it was conflict-of-interest questions that tripped up former Democratic Gov. Jim McGreevey when he ventured out of state more than a decade ago. One such trip was to Puerto Rico, and it was initially bankrolled by a labor union for longshoreman that was also one of the then-governor’s major campaign contributors. McGreevey eventually said the union would be reimbursed. He was also criticized for initially making taxpayers pick up the tab for a trip to Ireland that was billed as a trade mission but also involved a family reunion.
For his part, former Democratic Gov. Jon Corzine generally covered his own travel costs during official foreign trade missions, including to Israel. (The wealthy former Wall Street executive also routinely tapped his personal coffers to finance his campaigns for office.)
But not everyone is as wealthy as Corzine, and using groups like Choose New Jersey to fund overseas trade missions means taxpayers don’t end up footing the bill for costly items like airfare and hotel accommodations. Yet lawmakers like Sweeney, the veteran Democratic Senate leader, are starting to voice new concerns about transparency.
Earlier this year, Murphy enacted legislation backed by Sweeney that upgraded disclosure requirements for politically active nonprofit organizations that are commonly referred to as “dark-money” groups since they aren’t required by the IRS to reveal donors publicly. But it’s unclear whether the new law, which is now being challenged in court, would cover Choose New Jersey activities.
Asked earlier this summer if Choose New Jersey should disclose more detailed information given the role it plays as a significant funder of gubernatorial trade missions, Sweeney told NJ Spotlight the companies that support the group should have nothing to hide, since the overseas missions are all about economic development that should ultimately benefit the state and its taxpayers.
“Why wouldn’t you want to promote that these companies are helping to strengthen the economy of the state of New Jersey? There’s no cloak and dagger stuff with that,” Sweeney said.