Holtec wins legal fight over $260 million tax credit award as N.J. Supreme Court declines to review appeal

Holtec International has won a yearslong legal fight over the energy technology company’s application for $260 million in New Jersey tax credits.

The New Jersey Supreme Court declined to hear the state’s appeal of a lower-court ruling that found the Economic Development Authority could not void the 2014 tax incentive agreement, according to records made public Tuesday.

Holtec on Wednesday called the news “welcome vindication.”

“With this matter finally behind us, Holtec looks forward to continuing its focus on developing clean energy technology to power future generations,” the company said.

The high court’s decision comes as the 2013 economic development legislation that led to the award of more than $1 billion in tax credits to companies that moved to Camden has come under renewed scrutiny.

New Jersey prosecutors now say the law signed by Republican Gov. Chris Christie was manipulated by South Jersey Democratic power broker George E. Norcross III and his allies as part of a criminal enterprise. Norcross was indicted in June on racketeering charges and has pleaded not guilty. He has accused state Attorney General Matthew J. Platkin of leading a political vendetta against him.

Holtec, a privately held company that specializes in nuclear fuel storage, hasn’t been accused of wrongdoing in that matter. It won approval for the tax incentives in 2014 — one of the largest state packages ever awarded.

The company subsequently invested more than $260 million to build a new campus in Camden, knowing that under its contract it would receive annual installments of incentives over 10 years that could be used to offset tax bills or sold for cash.

On its application, the company’s CEO certified that the submission of “materially inaccurate” information could result in the termination of the tax credits, according to court records. The company also stated that it had not been prohibited from working as a state or federal contractor.

Years later, though, when the state’s tax agreements with Holtec and other companies came under scrutiny by Gov. Phil Murphy’s administration, the state in 2019 learned that Holtec had been temporarily debarred in 2010 by the federal Tennessee Valley Authority after an inspector general alleged Holtec had funneled tens of thousands of dollars to one of the agency’s employees as it sought a contract. Holtec denied paying the employee, according to the IG report.

Holtec at the time chalked up the application issue to a mistake and later sent the EDA a letter correcting its answer on the debarment question.

In 2019 the EDA withheld $26 million in annual tax credits, citing Holtec’s failure to disclose the debarment and the company’s allegedly misleading statements about its consideration of “alternative sites” in South Carolina.

Holtec sued the EDA in 2020, alleging breach of contract. A Superior Court judge sided with the company, finding that the application’s provisions were ambiguous and that the EDA was at least partially responsible for any resulting confusion since it drafted the forms.

A three-judge appeals panel affirmed that decision last year, and the state’s highest court this week declined to intervene. A Holtec spokesperson said the company “converted nearly 50 acres of industrial blight into a state-of-the-art technology and manufacturing campus that delivered hundreds of high-paying jobs in New Jersey’s poorest community.”

An EDA spokesperson said while the authority is disappointed by the outcome, it “respects the decision of the Supreme Court not to take this case.”