Tax breaks were supposed to lead to a rebirth for one state’s poorest city. But the city has also been reshaped by the rich and influential Norcross family in ways that benefit it and its allies.
by Jeff Pillets and Nancy Solomon for ProPublica/WNYC | Oct. 3, 2019
This is being re-published with permission from ProPublica. This article was produced in partnership with WNYC, which is a member of theProPublica Local Reporting Network. ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for ProPublica’sBig Storynewsletter to receive stories like this one in your inbox as soon as they are published.
For decades, Camden, New Jersey, has exemplified urban decay. A steady exodus of residents and jobs turned the once-thriving industrial port into the state’s poorest city. The waterfront was mostly parking lots and vacant land. More than half the city’s budget was funded through state aid.
In the fall of 2013, state lawmakers sought to change that. Promising economic renewal, the Legislature passed a bill creating lucrative tax breaks for companies that agreed to move to distressed communities, with special incentives for Camden.
Cooper’s Ferry Partnership, the city’s leading nonprofit, was already poised to take advantage. It had just signed an agreement with the state giving it the right to purchase a business park known as the L3 complex.
Located across the Delaware River from Philadelphia, the 17-acre site offered some of the best office space in town. The nonprofit’s leaders envisioned millions of dollars in rent that would finance a long list of community projects, from new parks and recreation centers to farmers markets and job training.
But the Norcross brothers had other ideas.
The most powerful political family in the state had spent months helping to engineer the tax break law. George E. Norcross III, a prolific Democratic fundraiser and power broker, had championed the idea among lawmakers; his brother Philip Norcross, a lawyer and lobbyist with deep ties to local and state government, wrote parts of the legislation; and a third brother, Donald Norcross, then a state senator and now a member of Congress, had co-sponsored it. Once the law passed, the Norcrosses’ allies, business partners and clients took advantage.
On a frigid morning in March 2014, Philip Norcross met with Cooper’s Ferry’s top executive at City Hall. Norcross told him that even though the nonprofit had exclusive rights to buy L3, another group was now interested in purchasing and developing the complex, according to correspondence among nonprofit officials. That group’s principal player was one of George Norcross’ former business partners.
Cooper’s Ferry’s leaders initially resisted. “As you know, we do believe we can do this on our own,” the nonprofit CEO wrote to its board chairman. “I am OK w a conversation but don’t want to lose out on the opportunity.”
Three months later, however, the nonprofit changed course. It wrote a letter to the state that June, saying it wanted to transfer its option to buy the L3 complex to the group connected to George Norcross. By the time the deal closed at the end of the year, there was another partner as well: a subsidiary of Cooper University Health Care, where Norcross is the board chairman.
What happened in those three months — detailed in internal documents, memos and emails obtained by WNYC and ProPublica — offers a rare window into how the Norcross political machine wielded influence over development in Camden after the state adopted the new tax break program.
Whether companies abused that program is now the subject of state and federal investigations. Sources with knowledge of the federal inquiry say real estate transactions in Camden are also being explored by investigators. A spokeswoman for the U.S. Attorney’s Office in the Eastern District of Pennsylvania said she could neither confirm nor deny the existence of a probe.
In May, an investigation by WNYC and ProPublica found that, of the $1.6 billion in tax breaks awarded to companies in Camden, $1.1 billion went to firms with ties to George and Philip Norcross. George and Philip Norcross have denied any wrongdoing and defended the incentives as a tool to revive the state’s impoverished cities.
Much of the correspondence about the L3 deal involves John Sheridan, a prominent Republican attorney and the chairman of the Cooper’s Ferry board who, along with his wife, died in a violent incident in late 2014 that remains unsolved.
Sheridan held two positions: In addition to being chairman of Cooper’s Ferry, he was the CEO of Cooper University Health Care — where he reported to the chairman, George Norcross. (Cooper University Health Care and Cooper’s Ferry are separate entities.)
Throughout 2014, the documents show, Sheridan fielded a series of calls and emails from Cooper’s Ferry’s top leaders recounting their interactions with Philip Norcross as he intervened in the L3 deal.
Philip Norcross had no official role with Cooper’s Ferry, but he was chairman of the Cooper Foundation, the fundraising arm of Cooper University Health Care. The hospital system would eventually end up as a tenant and co-owner of the disputed office complex. A spokesperson said he was also involved as a “real estate expert” offering “pro bono” assistance.
Seeking to retain a stake in the L3 site, Cooper’s Ferry officials found themselves “trying over and over again to come up with something that will get past Phil,” Sheridan wrote in a memo.
The records show that Sheridan kept George Norcross in the loop and consulted with him at critical moments.
George and Philip Norcross declined interview requests for this story. A spokesman for the two brothers said their roles at the hospital system and as civic leaders gave them a legitimate business interest in the L3 transaction and the broader development of the Camden waterfront. He said Cooper’s Ferry would have been unable to execute the transaction without long-term rental income from the hospital system.
“Cooper’s Ferry was proposing to begin something it had never done — the purchase, redevelopment and management of a large scale property,” said the spokesman, Dan Fee. “And [they] intended to use Cooper University Health Care funds to finance it.” That made the hospital system indispensable, he added.
There is no mention of such an integral financing arrangement in public records or other documents reviewed by WNYC and ProPublica, including those provided by representatives of the Norcrosses, though Cooper University Health Care was approached as a possible tenant that could benefit from tax credits.
Records show Cooper’s Ferry was in advanced talks with a deep-pocketed developer that did not rely on the hospital system and was prepared to present a preliminary deal to the nonprofit’s board. “We will not be able to replace it with a better deal,” wrote David Foster, the president of Cooper’s Ferry.
Fee said neither George nor Philip Norcross profited personally from the L3 transaction.
The Norcrosses’ influence has, in fact, reshaped Camden in ways that have benefited them and their associates. The tax break law set off a flurry of interest in city land. In the wake of the L3 deal, George and Philip Norcross and their business partners went on to purchase five properties that were once owned by public entities, totaling nearly a dozen acres along the Delaware River. That’s almost half of the prime waterfront real estate that is part of the city’s redevelopment plan that runs from the Ben Franklin Bridge to the Adventure Aquarium.
Fee said the development opportunities attracted hundreds of millions of investment dollars and thousands of jobs to the waterfront. But neighborhood activists and organizers say the benefits flowed to a small number of political insiders and have not met the needs of the community.
“It’s just not decent,” said Amir Khan, a prominent Camden activist who has been critical of the Norcrosses. “How much more evidence do we need that the system is stacked against us? How much more public property goes to Norcross and his friends without us seeing a penny?”
For Cooper’s Ferry, the first sign of trouble came at a meeting at Camden City Hall.
In March of 2014, Anthony Perno, the Cooper’s Ferry CEO, found himself in the same room as Philip Norcross. They were at a weekly session where the mayor and other local leaders discussed development related to the nascent tax break program. That day, Perno wrote in an email to Sheridan, Norcross said he knew of a group that was also interested in the L3 project.
As it turned out, the backers were Ira M. Lubert, a Philadelphia real estate investor and onetime business partner of George Norcross, and Howard Needleman, a South Jersey landlord who leased space to Cooper University Health Care. Lubert had already partnered with Norcross to bid unsuccessfully on a bankrupt golf course in Cherry Hill, according to media reports.
Neither Lubert nor his representatives responded to phone calls and emails requesting an interview for this story. Needleman, in a brief interview, dismissed questions about his role as part of a “witch hunt,” but he declined to provide any details.
“The documents speak for themselves,” he said. “I’m aware of the investigation that is going on, and you should ask the people being investigated.”
After the City Hall meeting, Philip Norcross emailed Perno asking for a copy of documents related to the L3 deal. “Please send as soon as possible,” he wrote.
Perno wasn’t in the best position to say no.
He had already run afoul of George Norcross once, for appearing on the cover of NJBIZ magazine for a feature on the new tax break program — an initiative George and his brother Donald, the lawmaker, had helped pass.
George Norcross emailed the story to Sheridan and other associates. “Please read attached. Could his head fit in City Hall?” he wrote about Perno. “Thank God we have him in Camden or otherwise nothing would ever happen.” Norcross then floated the name of a possible replacement.
Sheridan begged George Norcross not to retaliate against “a loyal soldier that you and Donald can count on in the future.”
Now, Philip Norcross wanted a private company, not the nonprofit, to take the lead on the L3 project, according to Cooper’s Ferry emails. It would show that Camden could attract outside investment.
Cooper’s Ferry balked at the idea of using Norcross’ hand-picked developer as a private partner who would take over its ownership stake in the building. The nonprofit was lining up financing and potential tenants. National firms like Lockheed Martin had already expressed interest in renting space.
Sheridan floated Cooper University Health Care as a potential tenant. In an email, writing as CEO of the hospital system, he asked a Cooper’s Ferry executive to sketch out what such a deal would look like. The proposal showed that the potential tax breaks for moving 400 employees into the complex could cover Cooper University Health Care’s rent for a decade.
The Norcross spokesman now points to Sheridan’s involvement in the lease proposal as a conflict of interest, because Sheridan was on both sides of the transaction. It is one of the reasons George and Philip Norcross intervened, Fee said. Nevertheless, documents show hospital executives were excited about leasing the L3 building and told Sheridan to proceed.
“The L-3 is the best deal by a long shot,” wrote CFO Doug Shirley in an email to Sheridan. “No other option can touch it.”
Fee said Cooper University Health Care was more comfortable working with Needleman, based on past partnerships that went back two decades.
Outside counsel, Fee said, informed Sheridan that “he had to remove himself from the discussions” around L3 in the spring of 2014, though it’s unclear when exactly that notification came.
But the records show that Sheridan continued to be involved on the Cooper’s Ferry side, and Sheridan’s son disputes the claim of a conflict.
“My father’s actions protecting Cooper’s Ferry never once put him in conflict with Cooper Hospital,” said Mark Sheridan, a prominent lawyer who served as counsel to his father during the negotiations. “My father’s only conflict was with those whose bidding he appropriately refused to do.”
Meanwhile, Cooper’s Ferry executives struggled to maintain control of the project. They began talks with Lubert and Needleman, who wanted full ownership, but they also reached out to other potential development partners. At the top of their list was Mack-Cali Realty Corporation, which had developed high-profile projects along Jersey City’s booming waterfront.
Within weeks, the nonprofit had hammered out a potential deal with Mack-Cali that would have allowed Cooper’s Ferry to keep 50% ownership of the L3 campus. Top executives of Cooper’s Ferry were pleased. “We selected a partner who is far and away the best for the project and for Camden,” they wrote in a memo.
But Lubert and Needleman, the Norcross-affiliated developers, weren’t ready to abandon their bid. According to an email by Foster, the president of Cooper’s Ferry, Needleman said he was “looking for the full acquisition” and would take up the matter with Philip Norcross.
Within days, Perno and Philip Norcross met in person to discuss the L3 deal. It was a 90-minute session. Afterward, Perno and Foster called Sheridan with bad news: Norcross told him that Cooper’s Ferry executives were “‘persona non grata’ with George and Phil” and Sheridan himself was “co-opted” by Cooper’s Ferry, according to an account of the conversation Sheridan wrote for his files.
George Norcross and his politician brother, Donald, had to be the public face of Camden development, Sheridan wrote: “George and Don only.” Sheridan did not elaborate as to why. And if Cooper’s Ferry didn’t “get out of the real estate business,” its top officials, specifically Perno and Foster, would be out of a job, the notes say.
Perno and Foster declined comment for this story.
In an effort to preserve Cooper’s Ferry’s bid and defend its executives, John Sheridan sought to appease the Norcross brothers. In a draft memo, he wrote that Cooper’s Ferry “respects your leadership and has been trying to demonstrate that in many ways.” Perno, he noted, had referred the Philadelphia 76ers to Philip Norcross; the NBA team became one of Norcross’ marquee clients, winning $82 million in tax breaks to set up shop in Camden.
Discussing potential legislation that would create a state park along the Camden waterfront, Sheridan wrote: “It won’t go anywhere until you sign off.”
He also outlined why the L3 deal was so important to Cooper’s Ferry Partnership. If the nonprofit owned the site, it would have a consistent revenue source. “If not,” Sheridan wrote in the memo, “CFP will be left to scratch together enough money every year to operate and will likely wither away over time.”
It’s unclear if Sheridan ever sent the document to the Norcrosses. But in early May, he met Philip Norcross in person at his law firm, Parker McCay. He wrote down a list of talking points, showing that he planned to argue against firing staff — in particular, Foster, the Cooper’s Ferry president.
“I have a duty of loyalty and good faith and I need to act in a way consistent with that responsibility,” Sheridan wrote.
It’s also unclear what happened in the meeting. But emails suggest that the L3 complex was slipping from Cooper’s Ferry’s grasp. Two days later, the nonprofit executives linked up with Norcross’ hand-picked developers. Sheridan met with Lubert and later that afternoon joined up with Perno and Foster to meet Needleman; in a memo, Sheridan said they discussed, in part, “George and Phil’s views of Cooper’s Ferry Partnership and its leadership, including me.”
The next day, the nonprofit leaders appeared to give up the idea of owning L3. They wrote to Lubert and Needleman and asked them to name their terms.
The price of the building, $32.5 million, was the same amount that Cooper’s Ferry had agreed upon with the state Economic Development Authority.
Under the terms of the final agreement, which closed in December 2014, Needleman and Lubert became majority owners of the property, with a 51% ownership stake. The remaining 49% went to a subsidiary of Cooper University Health Care.
By that time, the hospital system had won approval for $40 million in tax breaks after claiming that its employees were at risk of going to a competing site in Pennsylvania. Fee said the hospital system used the tax credits to finance the purchase of its share of the L3 building.
A special panel named by Gov. Phil Murphy later reported that Cooper University Health Care misled the state on a separate issue — by claiming it might move the jobs out of New Jersey. The hospital system, which has hired criminal defense attorney Abbe Lowell, has denied any wrongdoing.
Cooper’s Ferry Partnership ultimately received a one-time payment of $600,000 for its option to buy the L3 building, which covered costs incurred during two years of work on acquiring the office property.
The nonprofit soon went through a shake-up.
According to his LinkedIn profile, Foster left Cooper’s Ferry that summer and began working at a real estate development firm in the greater Philadelphia area.
Perno saw his influence diminish through a reorganization of the nonprofit; he left last year. According to a plan that Sheridan sent to Philip Norcross, Cooper’s Ferry would bring on new board members to create a closer link between the nonprofit and the hospital system, and limit its work to smaller community projects like parks.
Sheridan and his wife of 47 years, Joyce, died in late September 2014 at their home in Montgomery Township, about 6 miles outside Princeton. Firefighters responding to a fire in the master bedroom found the bodies of both Sheridans with stab wounds and other injuries.
Somerset County prosecutors initially concluded that Sheridan had killed his wife and then himself. But the state Medical Examiner’s Office later ruled that John Sheridan’s death was not suicide. His death certificate now lists his manner of death as undetermined.
Speaking at a memorial service for the couple, George Norcross remarked how he and Sheridan, as leaders of opposing political parties, appeared as a “very odd couple to many people.”
He praised Sheridan’s dedication to Camden and told a moving story about how Sheridan had argued passionately to build Cooper University Health Care’s new cancer center in the city rather than out in the suburbs.
“Camden is a different place because of his vision,” Norcross said.
Today, Cooper’s Ferry pledges what it calls “inclusive prosperity” that benefits neighborhoods and residents as well as corporations on the waterfront. The CEO is a Norcross ally, and the board of directors includes many businesspeople affiliated with the companies that the Norcross brothers brought to Camden with the help of the tax break program, including Cooper University Health Care.
Cooper’s Ferry did not return calls for comment. But Fee said, “It is undeniable that Cooper’s Ferry has continued to grow and take on even larger projects and responsibilities in recent years and has been a key leader of the city’s renaissance.”
Some activists, however, dismiss the nonprofit as a tool to enrich political insiders. The group’s website and annual report offer pages of glossy pictures and praise of Donald Norcross and projects owned by George Norcross.
“Cooper’s Ferry Partnership is Camden’s shadow government, if you will,” said Thomas Knoche, a community activist, teacher and author of a 2005 book about George Norcross’ political machine in Camden. “It’s hardly democratic. It’s an elite group that brings together corporate and development leaders, and pretty much their agenda is to do what’s going to benefit them.”
The L3 complex now has competition for the distinction of being the finest office space in Camden.
In the past four years, nearly a dozen office buildings and high-tech manufacturing centers have sprouted along the waterfront, thanks to the $1.6 billion in tax breaks. Like the L3 site, most of the new buildings are linked closely to Norcross and his political empire.
“When people ask me, ‘Is Camden’s renaissance real?’” Norcross said in March, speaking at the annual meeting of Cooper’s Ferry Partnership, “it’s a resounding yes.’”
Alex Mierjeski contributed to this report.
This report was produced with support from the McGraw Fellowship for Business Journalism at the Craig Newmark School of Journalism, City University of New York.
ProPublica and WNYC are spending the year investigating the power and influence wielded by party bosses in New Jersey’s political system. If you know something about the state’s controversial tax incentive program, we’d like to hear from you. We’d particularly like to hear from:
- Past or present state employees who can tell us about the mechanics of the tax break program
- Past or present employees at companies that received tax breaks since 2013 who can tell us about the application process
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