GOVERNOR CORZINE SIGNS NEW ECONOMIC RECOVERY LEGISLATION
Long term initiatives focus on continued rebuilding of economy
NEWARK – Governor Jon S. Corzine today signed economic recovery legislation to further reinvigorate the Garden State economy through a series of enhanced economic development measures.
“Without a doubt, the current global economic crisis has presented us with of one our greatest challenges, but it is also one of our greatest opportunities,” said Governor Corzine. “Last October, we introduced a far reaching and multi-faceted Economic Recovery and Assistance Plan. Today we are building upon those initiatives with this additional recovery legislation that will help our economy and citizens grow stronger and more prosperous.”
The bill, S-2299/A-4048, establishes an Economic Redevelopment and Growth (ERG)
Grant Program; revises the Urban Transit Hub Tax Credit Act and the Technology Business Tax Certificate Transfer Program; places a moratorium on COAH “Statewide Non-Residential Fee Act” and authorizes grants to municipalities for affordable housing and improves the financing of higher education facilities in New Jersey.
“In the face of daunting national economic challenges, New Jersey has been at the front of the pack in developing new thinking and approaches to staunch the hemorrhaging of jobs and economic activity out of our State,” said Senator Raymond Lesniak, (D-Union). “The initiatives contained in this bill will establish even stronger job growth and business retention policies that ultimately will help create thousands of new jobs and billions of dollars in economic activity around the State. I applaud Governor Corzine for his foresight and commitment in making New Jersey the first to deal with the global economic crisis, and this legislation is another step forward in our State’s path to economic recovery and prosperity.”
“This legislation is real proof of Governor Corzine's pro-urban and pro-jobs New Jersey agenda. For cities like Newark, the signing of this Economic Stimulus bill will create tangible development and new tax revenue which will help us achieve economic progress. This smart growth legislation will be the catalyst for an increase in jobs, construction projects and investment opportunities that will not only benefit Newark's residents but all of New Jersey. Thanks to the leadership of our Governor and State Legislature, New Jersey is on the path to economic recovery.”
The Economic Redevelopment and Growth (ERG) Grant Program will be established in the New Jersey Economic Development Authority (EDA). The program will provide incentive grants to developers that will reimburse a portion of taxes generated through the project. This will help fill in financing gaps which represent a part of the total redevelopment project cost for which the developer cannot find other financing.
“Local officials and businesses need more tools and greater flexibility to work together in planning and building the infrastructure projects that will bring new jobs and economic opportunities to New Jersey,” said Assembly Speaker Joseph J. Roberts Jr. (D-Camden). “This multi-faceted effort sends the clear message that New Jersey is open for business and looking to the future.”
As a further catalyst to economic development, the bill expands eligibility, clarifies qualifications, and limits certain provisions under the “Urban Transit Hub Tax Credit Act.” This includes lowering the capital investment threshold from $75 million to $50 million for an owner of a qualified business facility and from $50 million to $17.5 million for a tenant that occupies a leased area of the qualified business. It also expands the “urban transit hub” definition.
“An investment tax credit is an important tool to luring new jobs and taking full advantage of our transportation infrastructure,” said Assemblyman Albert Coutinho (D-Essex). “Focusing private investment in our transit hubs would complement the infusion of federal stimulus money in vital transportation projects.”
In addition, revisions to the Technology Business Tax Certificate Program will increase the transferability and amounts of the new or expanding emerging technology and biotechnology companies’ research and development tax credits and net operating losses. These changes include an increase in the maximum lifetime benefit per business from $10 million to $15 million.
“New Jersey has a long history of being a hub for technological innovation and advancement,” said Assemblyman Upendra Chivukula (D-Somerset). “This enhanced investment incentive will ensure we continue writing new chapters of that history.”
The legislation also exempts certain property from the 2.5% development fee imposed by the “Statewide Non-Residential Fee Act” and appropriates $15 million to the “New Jersey Affordable Housing Trust Fund. ” As a result, the Department of Community Affairs (DCA) will have the ability to grant awards or loans to municipalities based on their anticipated use of municipal development fee funds.
“We cannot allow towns to back away from their responsibilities to provide housing choice and opportunity to all working families, but this move recognizes the vital need to move projects along and get shovels in the ground during these extraordinary economic times,” added Speaker Roberts.
To improve financing opportunities of higher education facilities in New Jersey, the bill allows state and county colleges to enter into public-private partnerships for
on-campus construction projects. The New Jersey EDA will be responsible for reviewing and approving all projects, which must be submitted within 19 months of enactment of Act.
“Too many state colleges and universities have been forced to rely on borrowing and tuition hikes as they try to keep up with the needs of rapidly growing student populations,” said Assemblyman Patrick J. Diegnan Jr. (D-Middlesex). “Allowing schools to work directly with the private sector will not only create the modern campuses needed to keep more students in New Jersey, but will also do so in a more financially sound way.”
The legislation also provides authorization for certain municipalities to impose special taxes and surcharges to fund redevelopment activities and certain programs.
“Not only are we giving towns a new tool to help them smartly redevelop, but we are basing it on a highly successful program that has proven results,” said Assemblyman Louis Greenwald (D-Camden). “Tossing aside a failed model for one we know works makes common sense.”
Certain large, energy-efficient audited manufacturing facilities producing products from post consumer materials will also find relief through a seven year exemption from the sales and use tax on their purchase and use of energy and utility service and from the transitional energy facility assessment (“TEFA”) unit rate surcharge.
The bill was sponsored by Senator Raymond J. Lesniak (D-Union), Assembly Speaker Joseph J. Roberts, Jr. (D-Camden, Gloucester), Assemblymen Albert Coutinho (D-Essex, Union), Patrick J. Diegnan, Jr. (D-Middlesex), John S. Wisniewski (D-Middlesex), Upendra J. Chivukula (D-Middlesex, Somerset) and Assemblywoman L. Grace Spencer (D-Essex, Union).
Governor Corzine swiftly responded to the global economic crisis by introducing his Economic Assistance and Recovery Plan in October 2008 during a joint session of the New Jersey Legislature. With the Legislature’s quick action, the Governor has advanced many initiatives designed to stimulate New Jersey’s economy and create jobs while also working to protect those hardest hit by the slumping economy through food, home energy assistance and foreclosure programs. Federal funds through the American Recovery and Reinvestment Act (ARRA) passed by Congress and signed by President Obama on February 17, 2009 complements Governor Corzine’s Program.
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