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New Jersey Task Force Subpoenas Firms That Got Tax Credits

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06/25/2019 | 03:13pm EDT

By Joseph De Avila

A task force examining New Jersey's corporate-incentive programs continues to zero in on a group of businesses with ties to political power broker George Norcross.

The task force, appointed by Democratic Gov. Phil Murphy, issued subpoenas Friday asking the companies for documents and communications related to potential work sites located outside of New Jersey that the firms referenced in their applications for tax credits, according to court papers filed Monday.

The subpoenas follow the release of the task force's initial report earlier this month that concluded that many companies may have misrepresented their intentions to leave the state in order to receive the incentives.

The New Jersey Economic Development Authority, which oversees the programs, approved $11 billion in tax incentives between 1996 and February 2018 to lure and keep companies in one of the country's highest-taxed states.

The task force is mandated to determine "whether any company was able to defraud or misuse the tax-incentive programs through any oversight failures," the subpoenas said.

Mr. Norcross, a Democrat, and the companies have denied any wrongdoing. A spokesman for him and Conner Strong & Buckelew, the insurance firm where Mr. Norcross is executive chairman, didn't return a request for comment.

"We have been, and continue to be, willing and ready to publicly discuss our application for tax incentives and our decision to move to Camden in any fair and appropriate forum, including the inquiry by the New Jersey Attorney General, just as we did with the review by the United States Attorney's office several years ago," Mr. Norcross said in a letter sent to New Jersey lawmakers earlier this month in reference to Conner Strong & Buckelew.

The task force also issued subpoenas seeking all documents concerning the alternative locations that the firms provided to law-enforcement officials since Jan. 1, 2015.

The task force's report said Cooper University Health Care, where Mr. Norcross is chairman of the board of trustees, likely misled the state by saying it was considering leaving New Jersey to qualify for nearly $40 million in tax credits. Of that, $32 million may have been improperly awarded, it said.

Cooper was among the companies subpoenaed Friday, according to court papers. A spokesman for Cooper didn't immediately return a request for comment. The spokesman previously said the company did nothing wrong and that NJEDA properly awarded the tax credits.

Conner Strong & Buckelew was also issued a subpoena seeking similar information related to tax credits it received for moving its headquarters to Camden.

The task force's initial report was released after a state judge rejected a motion from Mr. Norcross and the companies that sought to block its release and to obtain a stay of all future hearings.

Now, attorneys for Mr. Norcross and the companies are asking the court for a partial reconsideration of that ruling and are asking the judge to modify the subpoenas to ensure that they can cross-examine witnesses and present their own evidence during the task force's public hearings so that they can fairly defend themselves, according to court filings.

Lawyers for Mr. Norcross and the companies wrote in court filings that the task force is subpoenaing documents that could be used "with impunity to malign parties powerless to confront their accusers or present a countervailing version of the facts."

The subpoenas also demanded that the companies produce contemporaneous documents to show proof of all site visits the firms made to potential alternative locations referenced in their application for tax credits. The task force also asked for all communications between the companies and their real-estate brokers along with all business plans and analyses created in connection with the firms' consideration of alternative sites.

A spokesman for the task force had no immediate comment.

The task force will accept comments from the public about New Jersey's tax-incentive programs at its next hearing on July 9.

Write to Joseph De Avila at joseph.deavila@wsj.com

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