UNITE HERE Report: NJ Turnpike Authority Gives $40 Million in Aid to Firm Owned by Billionaires
UNITE HERE has issued a report, New Jersey toll road authorities: HMS Host and its billionaire owners didn't need up to $40 million in relief. HMSHost is the world's largest operator of food and beverage concessions for travelers in the world, including 17 highway rest stops in New Jersey. Its contract with the New Jersey Turnpike Authority (NJTA) alone is worth an estimated $6 billion in revenue over its term. HMSHost is owned by Italian-based Autogrill (AGL.MI and BIT:AGL), majority owned by the Italian billionaire family Benetton, whose net assets were valued at over $13.8 billion at the end of 2019.
Yet, on March 24, 2020, the NJTA reported that HMSHost had told them it was "not currently in a position to continue paying" its contractors on projects to which HMSHost had previously committed. Although NJTA's toll revenue was already decreasing, NJTA committed to temporarily pay up to $40 million in HMSHost's NJ construction bills, even though HMS Host's March 23 letter asking for relief includes no details or a single number regarding HMSHost's finances.
While HMSHost was asking for aid, its parent company started share buybacks of up to 3 million shares at a maximum cost of $35.8 million, at the same time that HMSHost had also laid off thousands of workers across the U.S. This buyback program continued into April, even AFTER HMSHost had told NJTA it was "not currently in a position to continue paying" its construction contractors in NJ. As late as June, HMSHost's parent company's cash balance had increased by 67% since the beginning of 2020.
The New Jersey Turnpike Authority shouldn't be spending millions of dollars to give a helping hand to a company owned by billionaires; that's money that could have been used to offset increases in tolls and gas taxes.
HMSHost also operates the Farley Plaza on the Atlantic City Expressway thru a contract with the South Jersey Transportation Authority that is currently month-to-month.
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