Author Topic: Secaucus-based Goya awarded $82M tax break to move to Jersey City  (Read 4428 times)

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From NJBIZ:

Goya celebrates new Jersey City HQ — and staying in New Jersey
By Joshua Burd, April 30, 2015 at 10:15 AM

By Wednesday night, you could find workers loading up the trucks at Goya Foods' vast distribution center in Jersey City, preparing deliveries for many of its 13,000 customers in the region.

In other words, it was business as usual.

But it was only hours earlier that the sprawling facility was the site of an all-out celebration, complete with live music, confetti cannons and enough mouthwatering Latin food to feed hundreds of guests.

All the fanfare was meant to mark not only the opening of Goya’s new facility — a state-of-the-art, 642,000-square-foot logistics space and headquarters — but of the iconic food company’s decision to stay and grow in the Garden State. 

“We planted our roots in New Jersey in 1974, when this whole area was still swamplands and pig farms. We were one of the first businesses to come into the Meadowlands,” Goya President Bob Unanue said. “We believed then, and we believe now, that being in New Jersey allows us to continue to deliver the best possible service to our loyal consumers and customers throughout the region.”

Unanue said the event, which drew dignitaries such as Gov. Chris Christie and Jersey City Mayor Steven Fulop as well as numerous industry leaders, was “an historic day in Goya’s history and the culmination of a 10-year strategic plan.” The Hispanic-owned food giant has embarked on a $500 million global expansion at its facilities and products over the past decade, a plan that includes a $250 million investment in New Jersey alone.

That includes the project in Jersey City, which was built by Rockefeller Group, and more than $30 million in renovations at Goya’s 240,000-square-foot facility in Secaucus, its longtime headquarters before the company made the move about a mile away to the new facility. And Unanue said it meant the retention of more than 500 existing local jobs and the prospect of 100 new positions.

Goya made the move with the help of a controversial $82 million tax credit from the state Economic Development Authority. Unanue noted that it’s critical for the company to be in this region, but that it could have made the expansion at a facility in Suffern, New York, at half the cost.

But Goya is thankful to remain in its home state of more than 40 years, he said. And that means it will grow in New Jersey as its key demographic continues to grow.

“We’ve paralleled the growth of the Latin community, which has been 62 percent over the last 10 years,” Unanue told NJBIZ after the event. “It went from 35 million Latinos in this country to 57 (million). We’re the second-largest Latino country in the world, next to Mexico, more than Spain.

“So as our consumer base grows, we grow.”

And he said Goya is also looking to grow in the general market across the globe, with good-tasting, healthy products such as quinoa, organic food and low-sodium and gluten-free offerings.

But being headquartered in this region is a matter of strategy, Unanue said. That’s because its products are delivered to individual locations and selected based on market demographics, rather than to warehouses, as part of the company’s direct store delivery model.

“We sell our whole selection, which trends into our brand, door to door. To do that, you’ve got to be within earshot of your market, so it’s location, location, location. New Jersey is simply strategic — logistically, transportation-wise.”

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Secaucus to Jersey City: pay up!
« Reply #5 on: 03-18-2013, 11:13am »
Secaucus to Jersey City: pay up!
Town asks AG to investigate city’s tax deal with Goya
by E. Assata Wright
Reporter staff writer
Mar 17, 2013

The Town of Secaucus has asked the state Department of Community Affairs (DCA) and the Office of the New Jersey Attorney General to review the tax abatement deal Jersey City approved for Goya Foods Inc. in 2011.

According to a memo filed by Secaucus’ town attorney with the DCA, the 20-year tax abatement offered to Goya has allowed Jersey City to keep more than $1.1 million annually from a regional tax sharing pool, a pool to which Secaucus contributes more than $2.8 million annually.

Secaucus is arguing that had Goya Foods been forced to pay conventional taxes, Jersey City would have had to forfeit most of this $1.1 million payment and its own $2.8 million contribution to the tax sharing pool would have been reduced.

In a memo to the DCA dated March 12, Secaucus Town Attorney Anthony D’Elia wrote that, “Jersey City made a conscious decision to grant a 20-year tax exemption to Goya based upon the understanding that, to do otherwise, would jeopardize a significant portion of the payments due to Jersey City under the…[Inter-Municipal Tax Sharing Plan]. In doing so, Jersey City, in essence, required the district’s paying municipalities to underwrite Jersey City’s generous tax exemption provided to Goya. Jersey City…recognized that it could utilize the payments received from the [Inter-Municipal Tax Sharing Plan] to provide the tax exemption.”

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Goya Foods breaks ground on new Jersey City HQ and distribution center
Published: Thursday, September 06, 2012, 3:03 AM
By Terrence T. McDonald/The Jersey Journal

Goya Foods took a first step in relocating its corporate headquarters and distribution center from Secaucus to Jersey City yesterday, with officials from the Spanish-foods giant breaking ground on a 617,000-square-foot, $127 million facility on County Road.

Goya will receive around $82 million over 10 years in state tax credits, as well as city tax breaks, as an enticement for remaining in New Jersey. Gov. Chris Christie said yesterday the new facility will help lure more businesses to the state.

“It is evidence of the ‘New Jersey Comeback’,” Christie said, using his now familiar catchphrase. “It’s not totally arrived yet but it’s a hell of a lot better than where we were on January 2010.”

The move, on a 40-acre lot on Jersey City’s industrial western edge, will put Goya roughly one mile south of its current location in Secaucus, where it’s been for nearly 40 years. The lot is located in Ward D, represented on the City Council by Bill Gaughan. Gaughan said nabbing Goya is a major accomplishment for Jersey City.

“Nothing this big has ever happened in my ward,” he said.


The state Economic Development Authority in October recommended $81.9 million in tax credits for Goya, saying the Spanish-foods giant had been thinking of relocating to Long Island, which would have cost the state over 300 jobs.

By staying in New Jersey, Goya said it would employ about 500 workers in the new Jersey City facility, only nine of them new jobs, according to an Oct. 11, 2011 memo from the EDA recommending the deal. Asked yesterday whether creating nine new jobs is worth $81.9 million in tax credits and additional city subsidies, officials disputed the figure, stressing instead that Goya plans to move 66 employees to the new facility from New York.

Goya, which reportedly brings in over $1 billion in revenue annually, will also save around $8 million over 20 years thanks to a tax break from the city approved by the council in November. Councilwoman at large Viola Richardson and Ward E Councilman Steve Fulop voted against the deal.

Not everyone is as cheered by Goya’s new facility.

“The $82 million in tax breaks is a lot of beans to move a company only five miles,” said Jeff Tittel, director of environmental group New Jersey Sierra Club. “We need to bring jobs into New Jersey, which could have been done by investing in offshore wind.”

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Divided Jersey City City Council grants Goya Foods a 20-year tax break
Published: Wednesday, November 09, 2011, 8:21 PM
Updated: Wednesday, November 09, 2011, 8:21 PM
Terrence T. McDonald/The Jersey Journal

A divided Jersey City City Council tonight formally approved a 20-year tax break for Goya Foods’ proposed Jersey City headquarters and distribution center, with two members voting against and two abstaining.

City officials and a Goya representative defended the deal, saying it will bring hundreds of permanent jobs and temporary construction jobs to the city.

Councilwoman-at-Large Kalimah Ahmad, making her final appearance as a council woman after losing Tuesday’s special election, voted in favor, and said residents opposed to the deal are being “fooled.”

“Tax abatements are incentives for businesses to come here and to build here,” Ahmad said.

But a handful of residents, and impassioned Downtown Councilman Steve Fulop, argued that the 20-year tax abatement is nothing more than a giveaway to a billion-dollar corporation. The Spanish foods giant would save $8 million over the course of 20 years under the deal.

“Can they create more jobs? Sure,” Fulop said tonight. “Is there any guarantee that they go to Jersey City residents? No.”

Ahmad joined council members Peter Brennan, Bill Gaughan, Nidia Lopez and Michael Sottolano in favor of the deal. Fulop and Councilwoman Viola Richardson voted no, while council members David Donnelly and Ray Velazquez abstained from voting.

Goya is expected to start constructing the proposed Jersey City facility in spring 2012, on a 40-acre lot on County Road, about 2 miles south of its current Secaucus headquarters.

The company would pay $806,400 for the first six years of the agreement, $892,950 for the subsequent six years and $979,500 for the final eight, according to the agreement approved tonight.

With no deal, Goya, which reportedly made $1.5 billion in revenue in 2009, would pay about $1.3 million annually in property taxes, according to city spokeswoman Jennifer Morrill.

Goya is also set to receive $81.9 in additional tax breaks from the state, which state officials said would help keep jobs in New Jersey.

Six residents, including three failed political candidates, raised objections to the deal, saying Goya needs no tax break. Frequent administration critic Yvonne Balcer referred to the global Occupy Wall Street movement in her comments.

“What we’re doing, again, is to protect that 1 percent,” Balcer said, adding that Goya’s owners are “very rich.”

James McCann, an attorney representing Goya, tonight defended the state tax break, without touching specifically on the city’s deal. Goya will only receive the $81.9 tax credit after 10 years, McCann said.

“It’s not a grant,” he said. “They don’t get cash. It’s not a form of financing. It is not a low-interest loan. It is an incentive to bring its facility to Jersey City.”

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Jersey City Council woos Goya Foods with tax abatement measure
Published: Thursday, October 27, 2011, 3:00 AM
Terrence T. McDonald/The Jersey Journal

With no debate, the Jersey City Council last night introduced a measure that would provide Goya Foods with a 20-year tax break to entice the Spanish food giant to move its base to County Road in Jersey City.

Goya, which is now headquartered in Secaucus, would pay $806,400 for the first six years of the agreement, $892,950 for the subsequent six years and $979,500 for the final eight, according to the agreement introduced last night.

With no deal, Goya, which reportedly made $1.5 billion in revenue in 2009, would pay about $1.3 million annually in property taxes, according to city spokeswoman Jennifer Morrill.

Morrill noted that with the tax abatement, which requires one more round of voting before it’s adopted, the city gets to keep a vast majority of the tax revenue. Without it, the city would receive $684,000, while the county and the school district would split the rest, she said.

City officials have praised Goya’s plan to move its headquarters to a 40-acre spot in Jersey City, where it would transform a currently vacant lot into a 600,000-square-foot office building and distribution center.

“Our city is desperately in need of blue-collar jobs and construction jobs, both of which will be created by the project,” Mayor Jerramiah Healy said this week in an e-mail.

Councilman David Donnelly last night abstained from the vote. Donnelly said he’s unsure about voting in favor of the tax deal considering Goya has donated to his employer, the United Way of Hudson County. Other than Donnelly’s abstention, the council voted unanimously in favor of the deal.

City resident Yvonne Balcer, a frequent administration critic, blasted the council for approving the tax abatement. If Secaucus were giving tax breaks to a Jersey City business to lure it away, city officials would be “screaming,” Balcer said.

Goya has also been awarded $80 million in tax breaks from the state to make the move.

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Secaucus-based Goya awarded $82M tax break to keep operations in N.J.
WEDNESDAY, OCTOBER 12, 2011
LAST UPDATED: WEDNESDAY OCTOBER 12, 2011, 9:29 AM
BY HUGH R. MORLEY
STAFF WRITER
THE RECORD


New Jersey awarded an $82 million tax break to Secaucus-based Goya Foods Inc. Tuesday, to keep the nation’s largest Hispanic-owned food company from moving 369 jobs a few miles over the New York state border.

The family-owned business, in its application to the New Jersey Economic Development Authority (EDA), said it is looking to build a 600,000-square-foot headquarters and warehouse in Jersey City for $127 million.


The company plans to consolidate operations from its existing headquarters in Secaucus into the new structure on County Road, and convert the old HQ into a manufacturing plant.

The new building would house 491 jobs – including 316 from the Secaucus HQ and 66 from the company’s Bethpage, N.Y.-based facility, according to an EDA synopsis of the proposal.

EDA officials said Goya had certified that it also was mulling a plan to build an 893,000-square-foot facility in Suffern in Rockland County, and move New Jersey jobs into it. The company said that project, with a price tag of $75 million, was the “low-cost alternative” to the Jersey City facility, mainly because of lower property purchase and renovation costs, the EDA said.

“This is all about jobs at risk,” said Caren Franzini, the authority’s chief executive officer, shortly before the EDA board unanimously approved the tax break. “This application is talking about 369 jobs that are at risk in New Jersey.”

Goya is the latest New Jersey corporation to seek funds under the state Urban Transit Hub Tax Credit program, which awards tax breaks to developers or tenants equal to 100 percent of their capital investment in a project that costs more than $50 million and houses 250 jobs.

The 491 jobs to be housed at the new Goya facility have an average wage of $44,000 a year and are predominantly warehouse positions, with some administrative and executive posts, the EDA said.

Goya, in a prepared statement, said it will now consider the EDA’s offer.

“Today’s decision is an important step for Goya Foods as we consider staying in New Jersey with what would be our largest facility in the U.S.,” said Peter Unanue, Goya’s executive vice president. “We are very excited about moving ahead with this process, and look forward to making our decision official once it is completed.’’

The company, which is owned by the Unanue family and is celebrating its 75th anniversary this year, employs 1,500 people in the U.S. and 3,000 worldwide, according to its application. The company has 13 facilities in the United States, the Caribbean and Europe, generating revenue of $700 million in 2010, according to the company synopsis.

Program rules require eligible projects to be within a half-mile of a commuter or light rail, or adjacent to – and using — a freight rail line. In Goya’s case, the Jersey City site is one-fifth of a mile from a freight-line loading point, which would be used for company shipments, EDA officials said.

Depending on the revenue generated by the project, tax break recipients can get 100 percent of their investment back if it creates 200 new jobs and about 80 percent if it does not.

Although Goya is expected to spend $127 million on the project if it goes ahead, it would generate only enough revenue for the company to get a maximum tax break of $82 million if it creates 200 jobs. If it does not, the company would get $80 million.

EDA officials said Goya’s plan would create nine new jobs, add 66 new jobs from the New York facility, and could also include in its new-job total about 100 positions currently held by freelancers that would either be hired either by Goya or a professional services organization working for the company.

The state recently awarded $102.4 million to help Panasonic Corp. of North America build a headquarters in Newark, a move that angered Secaucus officials, who were upset at the state helping a major employer move from the township.

Secaucus Mayor Michael Gonnelli said he is happy at Goya’s plan, because it would leave two company facilities in the township. He said he believed Goya will keep its headquarters in Secaucus, but added that he is not worried if it is converted into a manufacturing operation.

“They are keeping their two Secaucus facilities here,” he said. “So I’m not losing anything.”

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