George Norcross is an important man in New Jersey. According to media reports, lawsuits and an official state task force investigation, he appears to have used that power to influence the state’s economic development programs, directing subsidies and other benefits to companies associated with him, his family and his political allies.
You may not have heard of Norcross, but he’s “widely regarded as the most powerful unelected official in New Jersey” and its “top political boss,” according to WNYC and ProPublica; “widely regarded as the state’s most powerful unelected individual” by NJBIZ (which listed him #9 in its 2021 ranking of the most powerful people in New Jersey); “the most powerful boss south of Exit 7A” to Philadelphia Magazine; “widely considered the most powerful Democratic political leaders in southern New Jersey,” per The New York Times and “a wealthy 63-year-old insurance executive who is the state’s most powerful unelected official — and whose political wrath is so feared he has taken on an almost mythical status in Jersey circles,” according to Politico.
Norcross was once secretly recorded boasting of his power over even the state’s former governors Jim McGreevey and Jon Corzine, saying “In the end, the McGreeveys, the Corzines, they’re all going to be with me. Not because they like me, but because they have no choice.”
That power was laid bare in May 2019, when nonprofit journalism organizations WNYC and ProPublica published a joint investigative report detailing Norcross’s involvement in creating and awarding a series of tax breaks and other economic development incentives that eventually resulted in a reported $1.1 billion of a $1.6 billion statewide subsidy program going to companies in and around Camden, NJ that were controlled by Norcross, his family, his political allies and his and his brothers’ business partners. Further reporting identified potential false statements by for-profit and nonprofit companies connected to the Norcross family, including a hospital where George Norcross was board chairman that received approval for $39.9 million in subsidies.
Kevin Sheehan, an attorney in the law firm where Norcross’s brother Philip is managing partner and CEO, had reportedly engaged in “hundreds of calls, meetings and messages with top officials” in the Christie administration, legislature and NJEDA while the legislation to create the subsidies was being drafted. This included phone calls or e-mails to NJEDA president and CEO Tim Lizura “nearly every single day.”
The New York Times obtained a marked-up copy of the legislation that created the Economic Opportunity Act and Grow NJ subsidies, identifying which edits had been made by Sheehan. The NYT investigation found that Sheehan “was allowed by lawmakers to edit drafts of the bill in ways that opened up sizable tax breaks to his firm’s clients.” (The investigation also uncovered that Sheehan had not registered as a lobbyist on the legislation.)
One $260 million, 10-year subsidy deal, to nuclear company Holtec, was the second-largest ever made by New Jersey at that point. (Norcross served on the company’s board.) The WNYC/ProPublica investigation uncovered that the company had failed to disclose a previous $2 million fine for improper payments and benefits to an employee of the Tennessee Valley Authority. The NJEDA put Holtec’s subsidies on hold, and the company sued. In June 2020, an NJEDA brief in the lawsuit disclosed that Holtec was the subject of an ongoing criminal investigation, but in January 2022, a state judge ordered the NJEDA to resume paying Holtec’s tax credits; the state is appealing the decision.
Gov. Phil Murphy created “Governor’s Task Force on EDA Tax Incentives” by executive order to investigate the Camden incentive mess. (Norcross sued to stop the task force, but failed.) The task force concluded after its investigation that “special interests—in the form of a law and lobbying firm and the clients on whose behalf it apparently operated—appear to have had a significant impact on the design” of the subsidy law and as a result, the law “was—in several ways—structured to favor certain parties while disfavoring others in certain respects.”
The task force’s report also found that the law had been written in such a way as to exempt Camden from the basic requirement that subsidies end up delivering a public benefit: “Unlike the requirements applicable in other parts of the State that Grow NJ awards be anticipated to result in a net positive benefit to the State in terms of new tax revenue, these large awards for projects in Camden could be based on ‘phantom’ taxes that would never actually accrue and thus might not result in a gain to the public fisc.”
Despite all this, as of early 2022, most of the companies connected to Norcross that had gotten their awards through this politicized, unfair and mismanaged program were still receiving their promised subsidies.