Breaking news: Purchase Verizon stock!

by: Thurman Hart

Tue Oct 28, 2008 at 03:46:14 PM EDT

Verizon Communications today won approval for $20 million in state tax breaks in return for promising to keep more than 700 employees in an office tower near Newark's Broad Street Station.

Verizon, which Monday reported a 31 percent increase in profits, is the first firm to cash in on a lucrative urban tax break Gov. Jon Corzine pushed through the state Legislature in late January.

This is insane, for a number of reasons.  Make the jump.

Second of all, it's 700 jobs for a cost of $20 million.  According to my calculator, that averages to $28,571.43 per job.  Will the state break even?  It seems a bit far-fetched.  How many years will these people have to pay taxes to the state to end up having paid $28,571.43?  I don't know.  Maybe these are all multi-million dollar jobs, so maybe the answer is "Two".  Or maybe not.

Third - was there any indication that Verizon was going to pull out of New Jersey, or even cut back its workforce?  I'll admit that I'm very far down on the pecking order of this kind of news, but it seems unlikely.  Verizon has a thriving cellphone business, plus is expanding its market share of cable TV services and landline phone services.  

I call bullshit.  This isn't an incentive.  It's a giveaway.