Wednesday, February 20, 2019

New Jersey Awards Pennsylvania Company $39.6 Million to Open Camden Site

A Pennsylvania company was awarded nearly $40 million in tax incentives from New Jersey to build an administrative-office outpost on Camden's waterfront, bringing 200 jobs to a city that's been mounting a comeback.

The state Economic Development Authority approved the $39.6 million tax package, which spans 10 years, for Elwyn, a nonprofit. The company, founded in 1852 and based in Middletown Township, Pennsylvania, provides services to children and adults with intellectual, developmental, physical, medical, emotional and behavioral health challenges.

At the meeting, the EDA's managing director of business development, Paul Ceppi, told the agency's board that Elwyn was looking to take new office space for its administrative functions by either building a 53,425-square-foot facility at 2 Penn St. , which is part of a huge $1 billion redevelopment on the Camden waterfront, or else lease an existing 57,000-square-foot building in Wilmington, Delaware.

Elwyn will be bringing 167 new jobs to New Jersey, and Camden, as well as transferring 33 jobs that are now at its location at 1667 East Landis Ave., Vineland, New Jersey, to the city on the Delaware River, for a total of 200 jobs.

"These positions are all headquarter-related, dealing with payroll processing, insurance processing and the like," Ceppi said, adding that Elwyn plans to make a $39.6 million capital investment in Camden.

An EDA memorandum said that Elwyn's proposed project on Penn Street "represents a significant step forward for Camden's redevelopment efforts" and would have a net benefit to the state of $88,310 over a 35-year period. Elwyn will complete its capital investment by Feb. 1, 2021, according to the memo.

Camden has struggled, and made some strides, to overcome its economic woes, according to officials like former Gov. James Florio. Econsult Solutions Inc. released a report in January on the city's status and progress. It credited state tax incentives as being crucial in helping the city to rebound.

"Camden faced more than 50 years of economic decline, a decline that had a dramatic impact on the quality of life, health and well-being of its residents," the report said. "By the early 2000s, it was facing crises of fiscal health, public safety, and K-12 education. Through collaboration and commitment, Camden’s state and local government entities, business leaders, and community stakeholders have driven improvements across social determinants of health citywide. Crime is at a historic low, with murders down by 60 percent over five years, and violent crime down by 40 percent. New, state of the art of schools are open across the city, and test scores are rising. And most importantly, economic development is helping create jobs for Camden residents."

But the report cautioned that the city's economic recovery still needs assistance.

"Camden has made tremendous progress in a short period of time, but these changes are not yet secure, and continued investments by the private and public sectors, including the state of New Jersey, are necessary to ensure that Camden’s emerging platform for growth is not compromised," the report said. "The social determinants of health -- and the city's future -- require it."

Jeremy Sunkett, Elwyn's vice president of strategic real estate, attended the EDA session.

"It's been a long process and we're really happy with the results," he told the agency.

After the meeting, Sunkett said that redeveloper Liberty Property Trust owns the vacant site where Elwyn's office building is planned, nestled behind a new American Water headquarters.

"It's an expensive place to develop in general, Camden," Sunkett said. "And obviously it's distressed. It's a difficult set of circumstances. And you're also talking about riverfront construction for it, which puts a premium on the cost to build it."

With the move to Camden, Elwyn can move out of three different buildings at two locations, consolidating and going from about 130,000 square feet to 54,000 square feet, according to Sunkett.

At its meeting the EDA also approved a memorandum of understanding for a data-sharing agreement between it and the state Deportment of Labor and Workforce Development. The purpose of the agreement is "to promote additional compliance with the rules and regulations of the job-based incentive programs" within the EDA, according to the agency.

EDA Chief Executive Tim Sullivan talked about the agreement with state labor officials last week when he testified before a joint legislative hearing on New Jersey's tax incentive programs. An audit by the State Comptroller found that the EDA had “improperly awarded, miscalculated, overstated and overpaid” $11 billion in granted corporate tax breaks, in part finding there wasn't proper verification of jobs that were supposed to be created by some award recipients.

With its memorandum of understanding in place, the EDA said it will be able "to cross-reference the employment information provided by our applicants with data submitted" to the state labor department. The EDA will reimburse the department no more than $5,000 a year for the data-sharing.

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