A bipartisan bill sponsored by Senator Raymond J. Lesniak which would create the “Grow New Jersey” program to provide tax incentives for New Jersey-based companies which maintain existing employment levels and create new jobs was approved by the Senate by a vote of 38-0.
“Unemployed New Jersey residents need job opportunities, and this bill would go a long way to invigorate our economy, encouraging businesses to create jobs and grow the economy,” said Senator Lesniak, D-Union. “At a time when the State is facing record-high unemployment and capital investment has come to a standstill, we need to make a calculated investment to incentivize job growth and expand our economic recovery. The „Grow New Jersey‟ program stands to be one of our most valuable economic recovery tools, and I urge the Governor to sign this measure as soon as it reaches his desk.”
The bill, S-3033, would establish the “Grow New Jersey” tax credit business incentive program to stimulate economic investment and private job creation. Under the bill, businesses in qualifying development zones would be eligible for the tax credits if they make or acquire a capital investment of at least $20 million, and create or retain at least 100 full-time employees. Beyond the employment and investment eligibility standards, the business‟s CEO would be required to certify that any retained jobs are at risk of leaving the state and any new jobs wouldn‟t be created without the “Grow New Jersey” credit. Finally, the business would have to demonstrate to the New Jersey Economic Development Authority (EDA) that the tax credit will yield a net positive benefit for the state.
Qualifying businesses would be able to receive a base tax credit of $5,000 per job, per year, for 10 years on the amount of Corporate Business Taxes owed. The State EDA could increase the amount to $8,000 per job if certain conditions are met.
The per project tax benefit would not be permitted to exceed the capital investment at the project site, according to Senator Lesniak. He added that the EDA would have the authority to increase the amount of the program, beyond $200 million, if the agency determines that additional tax credits are reasonable, justifiable and appropriate. The EDA would be able to recapture the amount of the tax credit issued if a business does not remain at the site for at least 15 years. The business would forfeit their credits if it does not maintain an 80 percent job retention standard, employ less than 100 people at the location, or the business is sold or subleases its tenancy in whole or in part to another corporate entity.
“The Grow New Jersey program is structured in a way that businesses will be eligible for a greater tax credit for creating high-paying jobs, and businesses would be encouraged to redevelop abandoned corporate properties like the Shering-Plough Labs facilities in Union,” said Senator Lesniak. “The „Grow New Jersey‟ program will allow us to expand the job pool, put vacant, decaying corporate facilities back on the tax rolls, and encourage private investment in our State economy at a time when such investment is needed most.”
The bill now heads to the Assembly for consideration.