Friday Facts and Figures is a brief digital newsletter focusing on data points from NJPP reports, research, and policy debates in New Jersey and beyond.
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$14.7 Million
Seven corporations received $14.7 million in annual tax breaks from the state Economic Development Authority (EDA) for property taxes they never had to pay, according to a new report by the Philadelphia Inquirer. How? Under the Economic Opportunity Act of 2013, state officials included future property tax payments when calculating the size of corporate subsidy awards, even when new developments were given local abatements and property tax exemptions. Two companies — Holtec and ResinTech — would not have qualified for their corporate subsidy awards if not for their phantom property tax bills. [Philadelphia Inquirer / Catherine Dunn and Andrew Seidman]
Less Than 25 Percent
“Voters and policymakers should recognize that incentives are not a free lunch,” writes economist Tim Bartik in an op-ed for the Star-Ledger. Bartik explains that corporate tax breaks are not only costly, but they’re also not effective at altering the location decisions of companies. Incentives tip a corporation’s location or expansion decision less than 25 percent of the time — and even when they do, there is no financial windfall for state and local governments. To ensure a better return on investment, Bartik recommends reining in the cost of subsidies, shortening the timeframes on awards, and designing incentives to encourage hiring local workers and those who are unemployed. [NJ.com / Tim Bartik]
280,000
The Trump administration has expanded the right to overtime pay to salaried workers earning up to $35,586 a year. However, the increase leaves behind 8.2 million workers — including 280,000 in New Jersey — who would have benefited from an Obama-era rule that raised the overtime eligibility threshold to $47,000. The Trump administration rejected commenters’ requests to index the new threshold to inflation, and the rule maintains exemptions for “executive, administrative and professional” workers. This loophole allows employers to legally misclassify low-paid workers as executives to get around paying them for overtime. [NJ BIZ / Daniel Munoz]
287(g)
State Attorney General Gurbir Grewal has ordered local police to end their participation in the 287(g) program, which deputizes law enforcement as Immigration and Customs Enforcement (ICE) agents. The decision will help build trust between local police and immigrant communities, thereby enhancing public safety for all residents in the state. When local law enforcement participate in deportation efforts, it dissuades immigrants from stepping forward as witnesses to crimes or participating in criminal investigations. Anthony Ambrose, Newark’s director of public safety, sums it up here: “We have more (undocumented) immigrants that are witnesses and victims. We have very few who are suspects.” [NJ.com / S.P. Sullivan]
39 Percent
Income inequality continues to climb, but wealth inequality is far more severe, according to a new analysis by the Institute on Taxation and Economic Policy (ITEP). The top 1 percent of residents in the US now own 39 percent of total wealth in the United States, up from 23 percent in in 1979. Since the late 1990s, the top 1 percent have owned more wealth than the bottom 90% of US residents combined. By instituting a national wealth tax, the federal government could help combat inequality and invest in critical public assets like education and transit infrastructure. [Institute on Taxation and Economic Policy / Steve Wamhoff]
ICYMI
NJPP President Brandon McKoy joined Rep. Bonnie Watson Coleman and Imani Oakley of the New Jersey Working Families Alliance to discuss the federal Earned Income Tax Credit (EITC). “The EITC is one of the most successful programs in the history of the country in lifting families out of poverty,” Brandon explains. Far too many workers, however, are left behind due to rigid eligibility requirements. Fortunately, Rep. Watson Coleman has a plan to fix that. Tune in to hear more! [Facebook Live / Rep. Bonnie Watson Coleman]
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