The latest legislative hearing on state tax-incentive programs turned into a spectacle yesterday as much-anticipated testimony from Democratic power broker George E. Norcross III was at times overshadowed by protests and the arrest of an outspoken critic of the tax breaks.
The hearing in many ways mirrored the intra-Democratic party stalemate that has been playing out for over a year as lawmakers have largely defended tax-break programs amid heavy criticism from Gov. Phil Murphy and progressive activists who make up his base and have called for major reform.
One such activist, New Jersey Working Families leader Sue Altman, was dragged out of the hearing by state troopers at the direction of Sen. Bob Smith (D-Middlesex), the committee chair, as audience members on both sides disrupted the contentious hearing.
Murphy, a first-term Democrat, spoke out on social media yesterday to support Altman.
“Every senator on that committee owes her a direct apology,” Murphy said in a post on Twitter following the meeting of a select committee of senators that was convened earlier this year by Senate President Steve Sweeney (D-Gloucester).
Given the tenor of the meeting, it’s probably no surprise that after three hours of testimony, lawmakers appeared no closer to coming up with tax-incentive legislation that Murphy will approve. That means the standoff could drag on into 2020, and possibly beyond.
Norcross defends tax incentives
Norcross spent more than an hour defending tax breaks awarded to his insurance company and other Camden-based companies that have benefitted from programs that expired earlier this year.
The tax breaks that went to Norcross’s company and others in Camden before Murphy took office in early 2018 were the primary focus of a special investigative panel that was convened earlier this year by Murphy. That came after an audit released by the Office of the State Comptroller raised serious questions about whether companies have been able to profit without living up to job-creation or investment standards set in state law.
Murphy’s task force has already made at least one criminal referral, and published reports confirm ongoing probes involving both the state attorney general’s office the U.S. attorney’s office.
But Norcross yesterday offered a full-throated defense of the tax breaks in Camden, where he lives, including a nearly $90 million tax incentive awarded to his insurance company, Conner, Strong & Buckelew.
Questioning why Camden is in crosshairs
“Why has Camden been the focus? Why have only five to seven companies all located in Camden been the principal focus?” Norcross asked during his testimony, which lasted roughly 90 minutes.
He also suggested the task force and its special counsel have mounted a flawed probe, rooted in a misunderstanding of the state’s longstanding efforts to boost the economy in the wake of the Great Recession, especially in places like Camden that have faced severe economic distress.
“I’m here today to speak for myself, not through lawyers or spokespeople, to defend Camden and to correct many misstatements and mischaracterizations and outright mistruths that are having a serious negative impact on the revitalization of our city,” Norcross said.
Later, as lawmakers questioned Norcross, he disputed reports that suggested he played an inappropriate role in the drafting of tax-break legislation that was ultimately signed into law by former Republican Gov. Chris Christie in 2013.
“There is no disputing the fact that many, many, scores of people were involved in drafting and engaged in the intent of the legislation,” Norcross said. “There were many, many parties involved.”
Norcross testified before a room packed with onlookers, including critics of the tax incentives and of how they’ve been administered in Camden. Altman and the other critics have questioned whether the tax breaks have had a major impact on Camden residents even as companies like Norcross’s have reaped the financial benefits.
Smith tries to rein in unruly crowd
But Altman was removed from the hearing by state police before Norcross even spoke, as Smith attempted to tamp down audience reactions to other witnesses who testified before Norcross. At the onset of the hearing, Smith had warned audience members that he wouldn’t tolerate any disruptive outbursts.
“Be advised, if you want to shout, or boo, or act in a disorderly way, I’m authorizing our state troopers, if anyone behaves in a disorderly way, you can escort them out,” Smith said. “So let there be no doubt.”
He followed through on that warning after Charles Wowkanech of the AFL-CIO labor-advocacy group answered a question posed by Sen. Declan O’Scanlon (R-Monmouth) by calling for tax-incentive policies that work “for the residents and for the workers of this state.” That comment drew both applause and boos — and an immediate reaction from Smith.
“Officers, remove the entire back line that’s standing up … the entire line standing in the back,” Smith said.
Altman — who was standing off to the side — got caught up in the removal of audience members and refused to leave. At that point, she was forcefully dragged out by state police and arrested.
‘Three boos and you’re out’
“I was told at the moment that I was thrown out for booing three times. Apparently, it’s three boos and you’re out at the State House,” Altman told reporters later in the day. “I don’t remember booing three times, (but) many of us were booing because we didn’t like what we heard.”
“This is really about a travesty and a failure of democracy today and every day in Camden City,” added Altman, who has been among the loudest voices backing Murphy’s calls for tax-incentive reforms.
Murphy spoke about the incident later following an unrelated event yesterday in Morris County, calling Altman’s forceful removal from the hearing “completely outrageous and unacceptable”.
“Dissent, hearing both sides of issues, that’s American,” he said. “We wear that as a badge of honor, even when we don’t agree.”
Smith could not be reached later yesterday for a response to Murphy’s criticism.
It remains to be seen whether yesterday’s spectacle will cause both Murphy and lawmakers to hunker down further as their dispute over tax incentives threatens drag into another year. Earlier this year, lawmakers passed a bill seeking to extend tax-break programs that expired in late June to give more time to consider changes. But Murphy has refused to sign that legislation and instead sent back a conditional veto that calls for, among other reforms, caps to be placed on future tax-break programs.
Patrick Murray, director of the Monmouth University Polling Institute, suggested after the hearing yesterday that it likely did little to change “the power dynamic in the Democratic Party in the state.”
NJTV News report on the hearing