Last week, the Office of the State Comptroller issued an audit report identifying serious deficiencies in the management and administration of certain tax incentive programs run by the Economic Development Authority (EDA). For more than a decade, the Comptroller’s Office has earned a reputation for the rigor and independence of its work, and I want to commend Comptroller Phil Degnan for conducting such a thorough audit.
I found the report’s conclusions deeply troubling – both as a public official and as a taxpayer. New Jersey residents have a right to expect that their government will carefully tailor economic development programs to maximize the general welfare and minimize the use of public funds. The Comptroller’s audit raises serious concerns about whether EDA’s incentive programs fell short of those expectations over the past decade. It also highlighted the lack of robust internal controls at EDA, raising the troubling possibility that EDA may have failed to identify material misrepresentations made by one or more entities at the time the agency approved their tax credits.
I spent a significant portion of my career rooting out financial misconduct as a federal prosecutor in Newark and Brooklyn, and I get very concerned whenever I see a state agency distributing so much money, with so little oversight, over such a long period of time. There are many things we still do not know about the historical details of EDA’s incentive programs, but it’s time to start asking some tough questions. As Attorney General, I intend to figure out what exactly happened and whether any laws were broken. If it turns out that taxpayer dollars were distributed in violation of civil or criminal law, I will use the full powers of my office to seek recovery of those funds and ensure that the proper parties are held accountable. The residents of New Jersey deserve nothing less.