News
from…
New Jersey Policy Perspective
137 W. HANOVER ST. ● TRENTON, NJ 08618 ● NJPP@NJPP.ORG
1997-2007: 10 years advancing progressive policy change
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For release Wednesday, March 7, 2007 Contacts: Jon
Shure, NJPP 609-393-1145 x2
Bettina Damiani, Good Jobs NY 347-432-0315
CABLE NETWORK SEEKS NY TAX BREAKS
FOR SAME JOBS NEW JERSEY SUBSIDIZED
Just weeks after leaving New Jersey, where it got millions of dollars in state
tax breaks aimed at economic development, the cable TV network MSNBC wants $1.5
million more from New York City for moving the same jobs to Manhattan.
The New York City Industrial Development Agency is scheduled to hold a public
hearing tomorrow and to vote March 13 on a request by the cable network’s parent
company, NBC Universal, Inc, for a property tax abatement. New Jersey Policy
Perspective submitted the following statement to be read into the hearing record
by the nonprofit organization Good Jobs New York:
MSNBC left New Jersey with taxpayers holding the bag. Now the company wants
breaks from New York City to move there – after taking breaks from New Jersey
for the same jobs that will be moving to Manhattan. TV-watchers are familiar
with channel-surfing; this is location-surfing, another example of companies
playing states or cities off against each other while seeking the best tax-break
deal. The sooner that government officials catch on to this, the better it will
be for taxpayers. It’s happening all over the nation. No jurisdiction feels it
can unilaterally disarm, but whoever makes the first move will actually be
taking a major step in the right direction.
New Jersey gave MSNBC $7.8 million in breaks from one program and sold $167.5
million in bonds to purchase equipment it then leased to MSNBC – giving up
approximately $8 million in sales tax revenue. In return for these breaks
granted with much fanfare in 1996, MSNBC was supposed to stay in the state for
15 years. It left after 10. Memo to New York: don’t count your chickens.
“This is one more example of why government subsidies for business are
questionable policy,” said NJPP President Jon Shure. “There are better ways to
invest in economic growth and promote prosperity, without making taxpayers
pawns.”
Pointing out the likelihood that the cable channel was coming to New York
anyway, Bettina Damiani, Project Director of Good Jobs New York said, “MSNBC’s
move to the historic media location of Rockefeller Plaza isn’t based on taxes,
but a strategic business plan. It’s unfair that NBC pits New York and New Jersey
against each other and it’s disappointing that New York officials reward them
with another bite at the subsidy apple.”
In 1996, MSNBC opened a studio and offices in Secaucus, receiving one of the
first grants under New Jersey’s Business Employment Incentive Program. Under
terms of the BEIP award, the subsidized jobs were required to stay in New Jersey
15 years. Over a decade, MSNBC received $7.8 million from BEIP. But it didn’t
stay 15 years. Instead, MSNBC announced last fall that as part of a
restructuring plan, it would close the Secaucus studios and move over 400
workers to NBC’s headquarters in Manhattan.
According to a December 2006 settlement with the New Jersey Economic Development
Authority, MSNBC owes the state $2.3 million in BEIP repayments. But no money is
to actually change hands because as part of the agreement New Jersey will merely
reduce any future BEIP payments to CNBC’s facility in Englewood Cliffs by $2.3
million.
In other words, MSNBC is getting paid twice for the same jobs—once by New Jersey
taxpayers and once by those in New York City.
In addition to the BEIP grant, New Jersey issued $167.5 million in 25-year bonds
to purchase equipment it then leased to the cable channel. MSNBC avoided having
to pay any sales tax on the equipment in the process.
The project description from the New York City Industrial Development Authority
says MSNBC will relocate its headquarters, newsgathering and production
operations, including online editorial operations for MSNBC.com, to 30
Rockefeller Plaza. According to the document, the move will involve 421 fulltime
equivalent employees “currently based in the broadcaster’s Secaucus, NJ
facility.” NBC Universal seeks a $1.5 million property tax abatement from New
York City and permission to use previously authorized city and New York State
sales tax exemptions in connection with renovating about 1.4 million square feet
of office space.
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