Is the NJ job market really building momentum? 01/26/2016

Last year in the Garden State, 64,500 private sector jobs were created, more than twice the number in 2014, and the highest total since the year 2000. Nevertheless, there are still concerns about whether the Garden State economy is truly healthy and strong. “I think we have reasonable momentum going into 2016, however there is always a concern about the quality of jobs, and that’s a concern nationally as well, according to James Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University. He said a troubling aspect of what we’re seeing is an increasing number of unfilled jobs. “What we’re seeing is some high end jobs where there’s a mismatch between the skills of people who are unemployed and what those jobs require,” he said. “On the other hand we have a lot of jobs at the bottom of the income ladder such as wait staff and the like, so it is a smorgasbord of different types of jobs out there.”

He also said there’s never been a time when we were only creating good, high paying jobs, but the current picture is uneven. “We have a chance to keep the momentum going, but it’s not a sure bet,” Hughes said. He said the manufacturing sector is starting to grow a bit in New Jersey, but the stuff being made is of the high tech variety. Hughes believes an important element to watch is whether the U.S. economy continues to build momentum. “That has acted as a tailwind for the New Jersey economy, but as the stock market gyrations have shown there is worry about whether the U.S. can continue to grow as fast in a very uncertain global economy,” he said. “It’s too soon to call this an employment surge, I don’t think we can call it economic liftoff quite yet, there’s certainly uncertainty out there.”

For 76ers, this is what ‘state-of-the-art’ looks like in Camden 01/26/2016

While it remains a work in progress, the Philadelphia 76ers on Tuesday released a digital rendering of what its new “state-of-the-art” training facility coming to the Camden waterfront later this year is expected to look like. The exterior of the Philadelphia 76ers practice facility is shown under construction in this undated photo provided by the franchise on Jan. 26, 2016. The 125,000-square-foot building will be the largest practice facility in the NBA and provide the space to bring both basketball and business operations under one roof. “In designing the basketball operations facility we pulled inspiration from the most cutting-edge sports medicine, wellness, and recovery practices from leagues, teams, and sport disciplines across the world,” Sam Hinkie, Philadelphia 76ers president of basketball operations and general manager, said in a release.

The facility’s location — near the Susquehanna Bank Center and Adventure Aquarium — was chosen in partnership with Camden as well as the New Jersey Economic Development Authority (NJEDA) and is intended to support of Mayor Dana Redd’s “vision for the revitalization the waterfront.” Presently, the team practices at the Philadelphia College of Osteopathic Medicine, in Bala Cynwyd, while business-side operations are located at The Navy Yard, in South Philadelphia.” Even more gratifying is the commitment the Sixers have already demonstrated and will continue to do so through various community engagement activities like volunteering to beautify our neighborhoods, holding basketball and cheering clinics, or simply connecting with our residents,” Redd said.

The project was first announced in June 2014 after a vote by the (NJEDA) to approve $82 million in tax breaks to the team over the next 10 years. As part of the financial award, the Sixers were required to create at least 250 jobs at the Camden facility. Construction of the basketball operations facility is on schedule and projected to open toward the end of 2016. By mid-May, the facility’s exterior walls, roofing and window systems should be in place. Interior work by contractors will proceed after that. The basketball operations facility will include two NBA regulation-size basketball courts, a 2,800-square-foot player locker room as well as performance, wellness, recovery and hydrotherapy rooms. According to the Sixers, the facility was conceived as a destination for elite NBA and front office talent.

New Atlantic City takeover legislation announced 01/27/2016

Don’t call it a takeover. That was the message Tuesday after Gov. Chris Christie announced that a new bill will be introduced to provide the city its much needed financial rescue package, but also give the state more control of the city’s finances. Christie made the announcement at a press conference in Trenton with Senate President Stephen Sweeney and Atlantic City Mayor Don Guardian. Guardian described the new bill as a “partnership,” rather than a takeover. But Christie said the new legislation will include giving the state power to restructure the city’s debt, dissolve any municipal board or authority, terminate collective bargaining agreements and consolidate or privatize municipal services. Those are similar to the powers the state would have under the previous “takeover” proposal by Sweeney.

The director of the state Local Government Services will have these powers for no more than five years, instead of 15, under the new bill. That will enable the state to “stabilize the city’s financial future,” Christie said.mChristie expects the bill to be introduced and passed in February. Guardian, who opposed Sweeney’s original state takeover proposal, said the city needs the state to help restructure debt and negotiate property tax appeals, among other issues. The new bill will also include the financial rescue package Christie rejected last week, Christie said. The bills would end expensive casino tax appeals, allow casinos to make payments in lieu of taxes and redirect funds to help the city pay down debt and other obligations. Christie’s rejection left a $33.5 million hole in the city’s budget and put the city at risk of running out of cash by April. “There will be things in the new bill that neither the city nor state is going to like,” Guardian said.

Asked if this still amounted to a “takeover,” Christie said the legislation still needs to be reviewed, but added: “You can call it what you want to call it.” Throughout the press conference, Guardian called it a “partnership,” Christie described it as an “agreement,” and Sweeney said it was a “solution.” For City Council, the announcement rearranged the chess board before its emergency meeting to consider bankruptcy. Instead, a swarm of residents and reporters received an in-depth presentation on the pros and cons of filing for chapter 9 protection, then had to wait nearly two hours as council, the mayor and Sweeney discussed the new agreement in executive session. Despite the death of the old takeover bill, residents were skeptical about what was next to come. “I pray and hope the mayor and council haven’t been hoodwinked into giving up their control of the city,” said William Cheatham, 86. Asked whether the new proposal would still amount to a state takeover of the city’s finances, as Christie’s remarks suggested, Guardian said the new bill had still not been drafted, and that negotiations with the state could fail if there are certain things the city or state cannot agree on. “The whole bill may blow up,” Guardian said.

Moody’s Again Warns Investors to Be Wary of Uncertain Finances in NJ 01/26/2016

A major Wall Street credit-rating agency has once again warned investors to keep a close eye on New Jersey’s fiscal problems, a sign that the state is still struggling with significant budget issues even as Gov. Chris Christie has been downplaying those concerns while running for president. Moody’s Investors Service cited “extraordinary decisions and challenges” that New Jersey faces in 2016 with its Transportation Trust Fund and public-employee pension system in a notice issued to investors late last week. The report noted that the Transportation Trust Fund is set to run out of money on June 30. And it warned that a pending state Supreme Court case threatens to add billions more to the pension system’s $40 billion unfunded liability. The rating-agency’s lengthy message stood in contrast to the more optimistic portrayals Christie, a second-term Republican, has been offering over the last several months as he’s been seeking the GOP’s 2016 presidential nomination. In fact, in his State of the State address earlier this month he bragged about bringing “discipline back to our public finances” during his six years in office.

The Moody’s notice also underscored efforts by New Jersey lawmakers to address the state’s budget challenges while Christie has been devoting much of his time to the presidential contest. Those efforts include proposed constitutional amendments that lawmakers hope to put before voters in November that, if approved, would change how the state funds transportation projects and the pension system. New Jersey already has one of the worst debt grades among U.S. states; the rating agency didn’t lower that A2 debt grade any further in its notice. But it also chose to maintain the state’s “negative” credit outlook rather than bump it up to “stable.” No fix for the transportation fund has been put forward either by Christie or by Democrats who control the state Legislature, although more information could be coming in the annual state budget address the governor is scheduled to deliver on February 16. The current, soon-to-be-depleted transportation fund has paid for about $1.6 billion annually in road, bridge and rail improvements throughout the state over the last five years, while also drawing federal matching funds.

New Jersey is already the nation’s third-most indebted state, and Baye Larsen, a Moody’s senior analyst, predicted the solution to the transportation-funding dilemma would include “a mix of borrowing and pay-go financing that will influence the state’s future leverage position.“ State lawmakers, meanwhile, are advancing a measure that seeks to ask voters this fall to approve dedicating all revenue raised by state fuel taxes to the Transportation Trust Fund. The proposal wouldn’t solve the transportation-funding issue on its own, but if the fuel tax rates are increased later this year it would prevent future raids of those funds for other budget purposes. A response to the Moody’s notice issued last week by the Christie administration glossed over the transportation-funding issue altogether, choosing instead to focus entirely on the future of the pension system. But according to Moody’s, if the state loses a looming court challenge of retiree cost-of-living adjustments that were suspended as part of a broader 2011 reform effort, it could mean adding billions of dollars to system’s unfunded liability. That would put more pressure on the state budget to ramp up state contributions into the pension system.

Open-Space Preservation Funding Gets Put on Legislative Fast Track 01/27/2016

Hoping to free up funds sooner rather than later, a legislative committee yesterday quickly revived a bill to provide money to preserve open space, farmland, and historic structures. In a unanimous vote, the Senate Environment and Energy Committee approved legislation to allocate approximately $146 million over the next two years from corporate business taxes to enable towns, counties, and others to acquire and protect open spaces and agricultural land. An identical bill had been pocket vetoed by Gov. Chris Christie last week, along with dozens of other measures passed on the final day of the lame-duck legislative session earlier this month. Even though money for the open-space programs is being collected, it cannot be distributed until implementing legislation is signed into law, which gives urgency to resolving the issue as quickly as possible.

“Hopefully, we get it on the governor’s desk soon,’’ said Sen. Bob Smith (D-Middlesex), the sponsor of the bill (S-969) and the previous measure in the lame-duck session. “This time we are going to get it done.’’ Conservation groups and others echoed those concerns, saying it is important to start releasing the funds for the programs, some of which have run out of money. The bill implements a constitutional amendment dedicating a portion of corporate business taxes to open space, which was overwhelmingly approved by voters in November 2014. “Uncertainty about the status of funding will persist until a compromise solution is reached between the Legislature and the Christie administration,’’ said Ryck Suydam, president of the New Jersey Farm Bureau. “The urgency to release these voter-dedicated funds increases with each passing day,’’ agreed Ed Potosnak, chair of New Jersey Keep It Green, a coalition of more than a hundred conservation, historic-preservation, and park advocates who had lobbied to put the constitutional amendment to voters.

Christie opposed the ballot question, even though he campaigned during his initial run for governor vowing to create a stable, long-term fund for open-space programs. Christie’s did not spell out a specific reason why he vetoed the most recent open-space bill, but his press office blamed it on the more than 100 bills approved by lawmakers on the last day of the previous legislative session. If the bill wins approval, it would establish general parameters where the money could be spent during the next four years. Smith called the legislation the most important environmental bill in the current session. He noted $66 million has yet to be allocated from taxes collected in the current fiscal year, which ends July 1, and another $80 million should be available in the next budget. The bulk of the money would go for the state’s popular Green Acres program (61 percent), which funds open-space acquisition and park development, including in urban areas. More money is allocated for urban communities than in the past, Potosnak, noted. Thirty-one percent would be used for farmland preservation projects and 5 percent set aside for historic preservation.