ACTOR/COMEDIAN STEVE MARTIN ONCE said that “a painting is a permanent conversation that speaks to us each time we look at it.” Unfortunately, on the canvas that shows the Garden State, there are images that for years have sent the wrong signals to CEOs, as too many companies have chosen to leave New Jersey or expand elsewhere. Recognizing the need for change, New Jersey elected Governor Chris Christie in 2009 with his clear vision for bi-partisan, pro-business initiatives and policies. His new portrait of New Jersey has both attracted and retained many companies, but these efforts remain a work in progress. Businesses need to be actively engaged, through CIANJ and on their own, in advocating the following:
Reduce the Regulatory Burden on Businesses. Too often, regulations unnecessarily siphon away resources and hinder economic growth and opportunities. We must embrace the work of the Red Tape Review Commission—chaired by Lt. Gov. Kim Guadagno, and on which I am proud to serve as a representative of the business community—as one of the most effective tools we have for reducing the regulatory burden on businesses.
Eliminate New Jersey’s Estate and Inheritance Taxes. New Jersey and Maryland are the only two states to impose both an estate and inheritance tax, and New Jersey’s taxes are triggered at a threshold of estates of $675,000 in value. The federal threshold is $5 million and, in some circumstances, $10 million. Because of this tax, many New Jersey residents—including CEOs who take their companies, jobs and philanthropy with them when they leave—have moved out of state to locations such as Florida, which does not impose this tax burden. New Jersey should eliminate these taxes outright since they only generate 2 percent of state revenues.
Reform the State’s Pension and Benefits System. Governor Christie and the New Jersey State Legislature set a national example when they worked collaboratively on public employee pension and health reforms in 2011, but more needs to be done. CIANJ hopes New Jersey can build on the success of this legislation, and work to make the recommendations that Governor Christie referenced in his 2015 budget address a reality. The status quo cannot be maintained. Re-engineering the pension system to be more in line with private sector 401(k) plans and amending the benefits plan to adopt medical coverage that is comparable to what businesses are offering their employees are going to be necessary compromises to save the system from its inevitable self-destruction.
Adopt Meaningful Property Tax Reforms. New Jersey’s reputation as a state with high property taxes negatively impacts its attractiveness to new investments. When choosing where to locate a new business, cost of living for employees is often a factor because it affects the wages that must be offered. CIANJ supports the consolidation of services and the elimination of exemptions which allow municipalities to exceed the 2 percent cap on annual property tax increases that was instituted by the legislature at the urging of Governor Christie.
Fix the State’s Transportation Trust Fund. New Jersey’s transportation network is one of our greatest strengths, as it attracts businesses to New Jersey. Our citizens should constitutionally dedicate the monies earmarked for the Transportation Trust Fund (TTF) for road improvements and maintenance projects to prevent the past practice of raiding the fund to fill budget gaps. The TTF must be maintained, but while increasing New Jersey’s gas tax may seem like the simple answer, it will add to the cost of doing business here, which is counterproductive to the goal of attracting and keeping businesses.
As members of the New Jersey business community, we must keep these issues top-of-mind for our elected officials. Let’s work together by taking an active role in shaping a brighter, more business-friendly future for the Garden State.