A former vice president for Jackson Hewitt on Thursday told the New Jersey Tax Incentive Task Force the company lied on an application for tax incentives provided through the Economic Development Authority’s Grow NJ program.
Gulsen Kama, formerly vice president of financial planning and analysis for the Jersey City-based tax preparation firm, said Jackson Hewitt falsely told the EDA it was considering moving its headquarters from New Jersey to New York and Florida in the course of seeking an award under Grow NJ.
No such move out of state was ever considered, Kama said, adding that she had been told by Jackson Hewitt’s CEO and other high-ranking officials that the firm was only exploring moving from its Parsippany headquarters to another location in the state.
“The CEO certification was false and known by CEO to be false because as of such date, the decision to relocate to Jersey City was already a done deal,” Kama, referring to an EDA application form, told the task force. “VP strategy knew the CEO certification was false and willingly cooperated with the submission to New Jersey of the false certification.”
David Prokupek was Jackson Hewitt’s CEO at the time.
Kama, a whistleblower who was subpoenaed by the panel, said the company was advised to make this claim by a consulting firm.
The New Jersey Globe has identified the consultant group as Biggins Lacy Shapiro and Co., a Princeton-based site selection and tax incentives consulting firm.
Jay Biggins, the firm’s executive managing director, contributed $3,800 — the maximum amount allowed under state election law — to Gov. Chris Christie’s 2013 re-election campaign.
The firm Jackson Hewitt officials to claim the company would leave the state unless it received a Grow NJ award, the whistleblower said.
Kama — who, at the request of the task force, did not name any officials or firm in her testimony — said the consulting firm knew the application to be false. She said she raised the issue internally and was told not to worry.
In December 2015, Kama advised Jackson Hewitt executives the firm was not in compliance with the terms of the Grow NJ award, which required the company to maintain a certain number of employees in the state.
She was fired roughly two months later, in February 2016.
In 2001, Jackson Hewitt received an award under the Business Employment Incentive Program worth about $2.6 million, though it’s unclear how much of that award the firm had received when it made its allegedly fraudulent tax incentive application.
That award, Kama said, required the firm to maintain a minimum number of employees in the state and demanded the company keep those jobs in the state until Oct. 2016.
Jackson Hewitt’s Grow NJ application was made in 2015.
The firm settled with the EDA, repaying the authority roughly $270,000, or about 10% of the original grant amount.
Through a spokesperson, Jackson Hewitt denied Kama’s allegations and said it planned to cooperate with the investigation.
“Jackson Hewitt values its relationship with the state of New Jersey and intends to cooperate with the Task Force, as we would with any government inquiry,” the firm said in a statement attributed to a Jackson Hewitt spokesperson and sent by Michelle Starr. “Jackson Hewitt believes it provided an accurate and comprehensive application to the EDA and is in compliance with all applicable provisions of the Grow NJ and Economic Redevelopment and Growth programs.”
Kama’s testimony lent an explosive start to the task force’s hearings.
Gov. Phil Murphy, who signed the executive order creating the task force, has been on a campaign to sunset many of the EDA’s existing programs, a number of which were enacted under Christie with aid from Senate President Steve Sweeney.
The award doled out by the authority have benefitted communities in South Jersey, particularly Camden, the perch of political power broker George Norcross, a close ally and confidant of Sweeney.
Sweeney is seeking some reforms to the tax incentive programs but has eyed some of Murphy’s proposed reforms, like capping the awards doled out by the authority, with a degree of skepticism.
The South Jersey Democrat has previously praised the EDA programs, pointing to their role in the redevelopments of cities like Camden and Newark.