TRENTON — Gov. Phil Murphy on Tuesday declared New Jersey stronger and fairer a year into his tenure, but pointed to a scathing audit of the state’s corporate tax-incentive program as a sign that more must be done to fight a system he called “rigged” for the well-connected.
“For the past year, this administration has fought to create a New Jersey that works for everyone,” Murphy said in a nearly hour-long State of the State address, his first, before an audience of lawmakers and others in the ornate Assembly chamber.
“This is just the latest glaring example of what we are up against — a system that has been rigged to work for a favored few,” Murphy said, a week after the state comptroller found a lack of oversight of New Jersey’s economic development programs. The state attorney general says he’s reviewing the matter.
Murphy, a Democrat and former Goldman Sachs banker, enters his second year in office looking for a reset. He has enacted a number of liberal policies but clashed with lawmakers from his own party over high-profile issues like the state budget and his efforts to legalize recreational marijuana use and raise the minimum wage to $15 an hour.
The Democratic-controlled Legislature continues to investigate the Murphy administration’s handling of sexual-assault allegations against a former high-ranking official. Legislative hearings on the subject have tested Murphy’s credibility as a progressive and leader residents could trust after Republican Gov. Chris Christie’s tumultuous tenure.
Murphy didn’t mention the controversy, and instead took a victory lap for new laws aimed at closing the pay gap between men and women, mandating paid sick leave, enacting automatic voter registration, and signing tougher gun restrictions, among others.
He also took credit for investing more money in pre-K and college aid, which he said had enabled thousands of additional students to get early childhood education and attend community college tuition-free.
In addition to dignitaries like state Supreme Court justices and former governors (not including Christie), Murphy’s guests included a woman who had lost a son to gun violence and an undocumented immigrant who the governor said had received college tuition aid from the state under legislation he signed into law.
Perhaps most notable was the strong language Murphy used to describe New Jersey’s tax incentive programs, comparing them to “crony capitalism” and suggesting they had been “drawn up in a smoke-filled back room.”
Comptroller Philip Degnan’s report found that even as the state Economic Development Authority awarded billions of dollars in tax credits, it had failed to hold corporations accountable for the jobs and investments they promised to create.
The state beefed up its incentives under Christie, who worked with South Jersey Democrats to try to spur development in Camden. The incentives program expires in July, and Murphy called for caps on tax credits and other changes.
Senate President Steve Sweeney (D., Gloucester) and Assembly Speaker Craig Coughlin (D., Middlesex), speaking to reporters after the governor’s speech, would not commit to those ideas.
“To say the programs we did were bad — I just don’t agree,” Sweeney said. He faulted the EDA for insufficient oversight but defended the 2013 legislation that authorized the incentives. “But I believe there’s room for improvement," he said.
Turning to the year ahead, Murphy said he and legislative leaders had made “great progress” on legislation to raise the minimum wage — now $8.85 an hour. “Working together, we will get this done,” Murphy said, then turned from the speaker’s rostrum to exchange head nods with Sweeney.
The governor renewed his pitch for legalizing “adult-use” marijuana, saying it was good social and economic policy.
“[W]e can reverse the inequality and unfairness left from years of failed drug policies and shift public safety resources to where they can do the most good,” Murphy said. “We must ensure that those with a past mark on their records because of a low-level offense can have that stain removed, so they can move forward to get a stable job or an education.”
Legalization would also “allow us to broadly benefit from creating an entirely new and legal industry, much as we did last year with sports betting,” Murphy said.
Republicans, the minority party in both houses, didn’t see the governor’s first year in such glowing terms. They said Murphy had failed to address the cost of living in New Jersey.