Headed by Lt. Governor Kim Guadagno, the Partnership for Action (PFA) is the state’s public-private approach to economic development and the springboard for all initiatives, policies and efforts related to growing New Jersey’s economy and creating quality, sustainable jobs.
The PFA team consists of: the Business Action Center, headed by Lauren Moore; the New Jersey Economic Development Authority, headed by Melissa Orsen; Choose New Jersey, headed by Michele Brown; Secretary of Higher Education Rochelle Hendricks; and, of course, the Lt. Governor.
These four entities, in conjunction with the Lt. Governor, work in unison when it comes to serving the needs of business, whether it’s attracting, retaining or expanding a company in New Jersey, partnering with institutions of higher education for workforce and research and development needs, providing appropriate financing and tax incentive programs, offering assistance in navigating the waters of international trade, and, in general, helping navigate the many resources state and local governments have to offer companies both small and large.
We were able to meet with three partnership members at the offices of the New Jersey Economic Development Authority. Meanwhile, an interview with Higher Education Secretary Rochelle Hendricks was held on a separate occasion. Her comments appear as sidebar within this Q&A layout.
Lt. Governor Kim Guadagno contributed written comments which summarize the impact the PFA has had on the business community as follows:
“We have learned that the business community needs us to be responsive to them, and I think they have been pleasantly surprised at just how accessible the PFA is. I give out my cell phone number everywhere I go, and I think business leaders have been pleased to discover that I do, in fact, answer their calls. I also think businesses are surprised to see how hard we’re willing to work to help them overcome whatever obstacles come their way.”
Addressing the role of Choose New Jersey, she writes:
“By incorporating the independently-funded Choose New Jersey into the Partnership, the PFA has been able to market the state and woo businesses to New Jersey without using additional taxpayer funds. We are leveraging a public-private partnership to fully engage not just businesses that are considering leaving New Jersey, but those that haven’t yet considered the economic benefits of moving their businesses here. The competition between the states is fierce, so it’s been absolutely vital to have a partner like Choose New Jersey onboard so that we can proactively reach out to businesses to explain why the state is the perfect place to relocate.”
New Jersey Business would like to thank all of the media relations people within the respective PFA organizations for helping us organize this roundtable. Special thanks go: to Nikki Ouellette of Choose New Jersey; Linda Coles-Kauffman of the Business Action Center; and Catherine Scangarella, deputy chief of staff, and Joelle Farrell, Office of the Lt. Governor.
Following are biographies of the Partnership for Action team members:
Lt. Governor Kim Guadagno, New Jersey’s first elected Lt. Governor, was sworn into office on January 19, 2010. She was re-elected to a second term on November 5, 2013. As head of the PFA, Guadagno is the state’s main promoter and quarterback for economic development. She also serves as the 33rd Secretary of State. In that role, she oversees promotion of the state’s $40-billion tourism industry and administers programs related to the arts, culture and history. Additionally, she chairs the New Jersey Military Installation Growth Development Task Force. Guadagno began her public service career as a federal prosecutor with the Organized Crime & Racketeering Strike Force in Brooklyn, New York. She later became Assistant Unites States Attorney in Newark. After her federal service, Guadagno served as a ranking member of the State of New Jersey’s Attorney General’s Office. In 2007, she was elected as the first woman sheriff in Monmouth County, managing a 650-member law enforcement agency.
Melissa Orsen was named CEO of the New Jersey Economic Development Authority this past February. In that role, she oversees the various state financial programs that help businesses grow in the Garden State. These include the Grow New Jersey Assistance program and Economic Redevelopment and Growth program. She has more than 15 years of experience in the public sector and recently served as deputy commissioner of the New Jersey Department of Community Affairs (DCA), where her duties included policy oversight, constituent relations, communications and legal procurement matters. She was also chief of staff and chief counsel for the NJ Council of Affordable Housing within the DCA. She previously served as chief of staff to Lt. Governor Kim Guadagno, where her work focused on coordinating and implementing statewide economic growth and job creation strategies. During this time, she also served on the EDA Board as the Governor’s designee.
Michele Brown became president and CEO of Choose New Jersey this past January after serving for more than two years as the head of the EDA. Choose is a privately funded 501(c)(3) organization which has a double mission: economic development in conjunction with the other PFA members; and marketing New Jersey in-state, out-of-state and around the world in order to establish and grow businesses here. While at the EDA, Brown oversaw the streamlining of the state’s incentive programs through the Economic Opportunity Act of 2013. During her tenure at the agency, the EDA closed on financing totaling more than $3 billion to support nearly 550 projects across the state. Prior to the EDA, Brown served as appointments counsel to Governor Christie, where she provided strategic and legal guidance to the governor. She has an extensive background practicing law, serving 18 years at the United States Attorney’s Office in New Jersey.
Rochelle Hendricks was named the state’s first Secretary for Higher Education in May 2011. As Secretary, she is responsible for policy and program development to enhance the capacity and competitiveness of New Jersey’s higher education institutions. She has focused on: advancing the blueprint for higher education reform as recommended by Governor Kean’s Higher Education Task Force; and implementing the NJ Medical and Health Sciences Education Restructuring Act and the Building Our Future Bond Act. In March 2013, Hendricks became a member of PFA as well as chair of the Council on Innovation. In 2014, she was appointed to the State Ethics Commission and elected vice chair of the Educational Facilities Authority Board. Since 1987, Hendricks has served the Department of Education in a number of roles including acting commissioner, acting deputy commissioner and assistant commissioner. Prior to joining the Department of Education, she worked for more than 15 years at Princeton University in numerous capacities.
Lauren Moore is executive director of the Business Action Center (BAC). In this role, he oversees the Office of Business Advocacy, the Office of Planning Advocacy and the Office of International Business Development and Protocol. The responsibilities within these units include: coordinating state, local, and federal business assistance and incentive programs; providing commercial real estate site selection services; guiding companies on regulatory and permitting matters; developing land use strategies; and encouraging foreign-based firms to invest in New Jersey. Moore joined the BAC team in 2010 and is credited with helping the PFA secure commitments from over 280 companies to create and retain more than 75,000 jobs across New Jersey. This includes business attraction and retention projects involving Bayer, Church & Dwight, Forbes Media and J.P. Morgan Chase. Before joining BAC, Moore worked at the New Jersey Commerce and Economic Growth Commission. Additionally, he lent his expertise to high-level economic development and planning positions for Atlantic and Mercer counties.
Q: Can you describe the many ways all of you interact with each other to answer a business need or request?
Moore: It’s best to do this by example. The Lt. Governor is the state’s ambassador for economic development. She frequently is speaking with the business community. When a company reaches out to her about a particular project, we would have a conversation with that company to understand what its needs are. Typically, our first touch with a company will be with our colleagues from Choose NJ and the EDA. So, we take a whole team approach.
This gives companies a sense of security, knowing that government is here to help them. A good example of that, and a project we are now working on, is visiting [corporate] headquarters in New Jersey. We are doing this as a team approach. We are trying to engage these companies and have the conversation that they are important to the state’s economy … that we are aware that they are here. We know that they have location options. We want to understand their needs and what their plans are moving forward.
Then, we will have a conversation about the programs and services that an agency, such as the EDA, has to offer. Or, the company may have workforce development needs. So we would then work closely with the New Jersey Department of Labor and Workforce Development (LWD) and engage them.
Brown: That is one of the best things Lauren and his team does – make appropriate introductions between the business community and state government. It is hard, when you are a private business, to know who to call or who to reach depending on the problem that you have. This way, businesses don’t feel like they are going at it alone.
The beauty of it is, a business can contact any of us. What will typically happen is when we have a company coming in from overseas or another state, it would contact one member of the Partnership and, as a team, we would go visit. Choose will draft up the presentation about the state … its business assets, its geographic assets … it’s all part of our slogan, “Highly Educated, Perfectly Located.”
Lauren and his team would put together the aspect of the presentation related to economic development assistance that may be available for a particular company. The BAC has access to site location services, so if we know if a company wants to be in a particular geographic area, Lauren has access to available sites with all of the appropriate permits and facilities information that a company may need.
The EDA would talk about the vast array of business assistance that it provides.
Orsen: No matter who gets the call, it’s a group effort. If we [the EDA] get a call from a business, and the business is having issues outside of a financial need, then we know we would engage, for example, someone from Lauren’s team who would work with, perhaps, the Department of Environmental Protection or the Department of Transportation, and so on.
Q: It’s been five years since the Partnership has been formed. What have you learned, in that time, about the needs of the New Jersey business community?
Orsen: Businesses want predictability, consistency and a business climate where they have the ability to thrive.
Moore: You’ll see a lot in the press about location decisions being made around incentives. However, one of the things I have learned is that incentives are not the beginning or the end of the conversation when we are working with companies. What is important to companies is that they have the support of government and that they have access to the human capital, to make their project work.
Brown: The Partnership has also grown and matured. You can see by the addition of new members to the table. We have brought to the table new members such as Secretary of Higher Education Rochelle Hendricks, and we are working closely with Department of Labor Commissioner Wirths. This is because we know that what matters most to businesses is that they have a proficient and well-trained workforce. We have to deploy the right kinds of assets to make sure that our workers are trained for whatever jobs are going to be available for them.
If a company is looking for engineers, we can be sure that we know where the engineers are. If they are looking for people trained in a particular mechanical aptitude, we know that the LWD can provide workforce training grants to make sure people have the skills they need.
Q: Do you feel the large majority of small businesses in New Jersey know about the various programs being offered by your organizations?
Orsen: We are talking to the small business community about what we can do to better highlight the other EDA offerings … what else we can do in terms of the loans and bonds. So, yes, the small business community is certainly aware of the EDA and how we work with them, but we can do a better job in getting our message out there and reaching deeper into the communities to help them.
Moore: We do focus on medium and large businesses because they have a lot of jobs. But we also recognize that the backbone of our economy is the small business community. It’s more than just Main Street small businesses. I am talking about the 50-person machine shop that supplies parts to the aviation industry, for example. We have small business administrators at the Business Action Center who act in a clearing house capacity, directing people to our small business programs … programs that are housed in the EDA, but also at the New Jersey Small Business Development Centers, for example. Additionally, some municipalities and counties have programs, as well.
The Small Business Administration as well as the Lt. Governor have been conducting small business outreach efforts across the state. We call them resource efforts … we are here to connect these resources to small businesses. This is where we see a lot of growth, and we want to start making a deeper, more concerted effort to penetrate the small business community.
Q: What are the challenges when working with the 21 counties and 560-plus municipalities? How do you make everybody (those towns and counties) happy when it comes to finding a place to locate a business?
Moore: We are up to the task of working closely with the counties and municipalities. There are examples where a municipality has a single point of contact for business development, and we have seen things flourish in that municipality. Additionally, when we have conversations with our colleagues at the county and municipal levels, we share with them some of the business behaviors and practices that we have seen across the state that have helped other counties and towns succeed in attracting and retaining projects.
There are things municipalities can do, that are not incentive related, to make a positive contribution to close projects and help small business grow in New Jersey. We have been out with specific presentations about successful things we have seen, like real estate inventory: Knowing who the real estate brokers, landlords and major employers are in your municipality.
Q: You have been successful on many occasions, but what have been the reasons some businesses have chosen to leave the state?
Brown: For Mercedes-Benz, which decided to set up a manufacturing facility in Georgia, it was the cost of doing business. It was a tax decision that led them to move their headquarters facility to Atlanta.
Hertz and Sealed Air made similar decisions.
Sometimes the decision is made because the CEO wants to move to a warmer climate. When you have reasons like that, we know we are not going to win.
Lots of times the conversation we can have with businesses is, “Even if you are making a decision about locating a manufacturing or distribution facility outside of New Jersey – and we think there are great reasons to site one here – it makes no sense for you to move your entire headquarters facility out of the state. This is because the talent is here with the kind of workers you need at a headquarters facility. Plus, there is the proximity that you need to your PR and your marketing agency. Overall, you are in a better position to have those relationships here in New Jersey.
If you do a lot of traveling overseas, we have daily flights to Europe from Newark Liberty International Airport.
So, sometimes, we are able to convince a company to maintain part of the workforce here, even grow their business if they decide to move some other aspect of the business elsewhere. We are willing to pitch for the whole or any part of the business that makes sense for a particular company.
Moore: You heard how we launch into quick action when we hear about a company leaving, but that is being reactive. I want to note that we are very proactive, and this team has been proactive from the get-go. One of our big efforts is business retention, and the four of us have been working hard – proactively – to engage companies before we are reading about them in the newspaper.
We do a lot of research to see what companies are going to make a move in the market and are at risk of leaving New Jersey. It is important to note how aggressive we are with our research and how precise we are with our business appointments to certain companies because we are either getting the feedback through our network or through research. So, for the companies you read about leaving, there are 10 times as many that didn’t get to the papers because we got to them first.
Q: I suppose visiting corporations, as you mentioned earlier, helps?
Moore: We target the large employers because they are important. Everything trades on a relationship. We have a lot of experience doing this. We use our relationships with our constituencies to gather intelligence and keep our finger on the pulse of New Jersey’s business community. Even when it is a rumor or hearsay, we react to it and start making phone calls. We go through press clippings as well. The system we have in place is extraordinary. And our follow-up is extraordinary as well.
Q: Some critics of the EDA’s Grow NJ program say tax incentives are too generous, but by the same token, New Jersey is competing with other states that are offering tax incentives. What can you say about what seems to be a Catch 22 situation?
Orsen: The public policy advanced by the Legislature and signed by the Governor (The Economic Opportunity Act of 2013) was clearly to help the most distressed communities in New Jersey grow and thrive. The intended consequence is working. We are seeing application after application come in and, with the opportunity for tax credits, we are seeing significant opportunities for capital investments and job creation. Through what has been approved by the [EDA] board, over 12,000 new jobs and over 8,000 retained jobs have been realized since 2010.
What is misunderstood is that out of the $5 billion of [tax incentive] opportunities that have been approved, only $63.2 million has actually been realized in tax credits. This is because these are long-term projects. Those tax credits are only realized once there is an actual capital investment by the business and once jobs are actually created and retained.
(Editor’s note: Two weeks after this roundtable discussion, State Senator Raymond Lesniak, a key sponsor of the Economic Opportunity Act who later proposed a moratorium on the EDA’s main incentive programs until the Christie Administration analyzed their effectiveness, called off his effort after it was announced that the EDA and the Edward J. Bloustein School of Planning and Public Policy at Rutgers University had agreed that the school will review the Grow New Jersey Assistance program and the Economic Redevelopment and Growth program.)
Q: What do you consider your “top wins” in terms of business retention?
Brown: I like Campbell Soup Company’s decision to commit and stay in Camden because, if that hadn’t been the case, then I think you could make the argument that the enormous growth you will see in Camden over next few years would not happen. If Campbell had not stayed as the anchor tenant in the city and put all that property around them together and thought deep and hard about redevelopment in their city, you would never have seen Subaru moving in, or Holtec International moving in, or Lockheed Martin moving in: These are all of the companies now making a location decision in the city.
I think over the course of the next several months, you will see several other important announcements about development in Camden.
Moore: Lockheed Martin was huge. They are a huge part of South Jersey’s economy, and they are making a huge contribution in Camden and have entered into a great partnership with Rowan University with the training of Rowan engineering graduates to work at Lockheed. This is one of our great successes that shows how we are strengthening the economy in Southern New Jersey. It was one of our first successes of higher education … it was the project that really brought higher education into the Partnership.
Q: What do you consider key industry growth sectors in the state, and how are you growing those sectors?
Orsen: Manufacturing immediately comes to mind. The Economic Opportunity Act offers additional bonuses in that regard. I know that 68 percent of the incentives that the EDA has approved have been in the targeted industries highlighted under the statute. Approximately 34 percent have actually been in the manufacturing sector.
Brown: That is pretty extraordinary. If you ask anyone if they think manufacturing is a growth industry in the state, they would probably say, ‘No.’ But, when we looked at the stats, we were surprised.
Logistics is another area. It is everything from the recent Turnpike expansion and the money the Port Authority is spending on raising the Bayonne Bridge to a company like Amazon making a decision to build its second million-square-foot distribution space in New Jersey, this one in Carteret.
Healthcare is another growth area for the state. Big pharma is changing the way it does business, and part of that change is giving smaller companies the opportunity to working hand-in-hand with large pharma … so smaller life science firms can site themselves here and grow.
Moore: Financial services is another growing sector, because of New Jersey’s proximity to Manhattan and the attraction of our Hudson Gold Coast. When you look at the job numbers, we have been doing very well with financial services. We have historically done well, because we are well wired, have access to the financial talent here and great connections to the financial districts in Manhattan.
Q: What other opportunities for growth do you see coming in the next five years based upon the foundation you have created today?
Brown: We can say that in five years we will finally realize all of the growth we have worked so hard to nurture. We know that most of our major projects have a timeline of somewhere between two and four years, just for construction.
One of the best things we get to do is go to groundbreakings, but what is even more rewarding are the ribbon cuttings. When we went to the ribbon cutting for Goya Foods, not only was it a Cecil B. DeMille affair, but it tells us that all of our hard work has finally paid off and the company has actually made a commitment to the state. They put all of our construction guys to work and then hired people from the communities. There is no prouder moment than when we go to ribbon cutting day and we know the state is better off because of that company’s commitment to New Jersey, the community and its employees.
Moore: One of the things we have been working on, and it may take longer than a five years, concerns the real estate product that we have to offer the business community. It is important for us to work with the municipalities and do something with the corporate campuses that companies are leaving. This issue also concerns the attraction of talent. Millennials don’t want the suburban corporate campuses. We need to rethink the product.
Municipalities have to be a part of the conversation. It’s tough because when you start tearing down a million square feet of Merck’s campus in Whitehouse, for example – and that ratable goes “poof”– that is a shock and a real challenge. However, it is an issue that has to be addressed and we need to put some time and effort into that. We have been working with municipalities, real estate brokers and other professionals to help shape the thinking on it. We have had some successes.
The Bayer Project in Hanover Township is a great example of this because that was an Alcatel-Lucent site. It was redeveloped. Now, MetLife is going on the other half of the property. They are there with 800 jobs.
Working with Nutley on the former Roche site is another example. So, we have some successes that we are using to demonstrate to our municipal colleagues that there is life after a company pulls out of a corporate campus.
Orsen: I think we need an opportunity to allow our incentives to work … for businesses to realize those tax credits. Let’s see them work and let’s see the capital investment and job creation in New Jersey.
Brown: For Choose New Jersey, you will see an enhanced marketing and communications presence in the state. Part of our strategy will involve communications and marketing that is more sector driven. It may highlight an entire healthcare sector or an entire food or manufacturing sector in a way not typically done before. This is both to highlight the great companies we have in the state, and encourage other like companies to make a home here.
Moore: I want to add that one of the areas in which we have made an aggressive push is helping the small business community export its goods and services in foreign markets. We have a federal grant to do that. In our last grant, we helped over 40 companies go into markets they otherwise would not have been in. When we are helping New Jersey companies export their goods and services, we are bringing foreign investment and foreign dollars into New Jersey. We just applied for a third round of a federal export assistance grant. We are hopeful we will continue with this effort.
Brown: This is the economic development team for the state, and you can tell we are passionate about our work. The message that we want to give to the business community every day is that we are striving to make the state a business-friendly place to work. That is our commitment.
Orsen: We pride ourselves on being approachable. That is the message we are sending.