The governor was joined by Newark Mayor Cory Booker at the city’s Broad Street train station in Newark, a designated Urban Transit Hub, in signing the legislation that makes changes to incentive programs utilized by the state government in an attempt to promote economic growth and job creation.
The programs are the Economic Redevelopment and Growth Grant (ERGG); the Urban Transit Hub Tax Credit Act; and a residential development program originally created under the New Jersey Economic Stimulus Act. Christie and proponents in the legislature hope numerous large-scale development projects currently pending around the state will be jump-started by the expansion of the programs.
“Creating good paying, lasting jobs for New Jersey families is a top priority of this administration, which is why tax cuts and incentive programs that help businesses grow and expand were a core aspect of my budget, and will continue to serve as tools to foster economic growth,” the governor said. “Today, we are providing needed changes to incentives that are critical to growing our economy, creating jobs, and providing more opportunities for New Jersey families. Putting in place targeted incentives to encourage businesses to build, develop and expand in the state is a critical piece of our broader efforts to drive New Jersey’s economic recovery.”
The bill (S-2972) was sent to Christie by the Democratic-controlled Legislature.
The measure expands the ERGG program to make growth areas in the Meadowlands eligible for grants, adding the Meadowlands to the other areas of the state where growth is encouraged and eligibility for the grants is already provided, including State Planning Areas, Pinelands growth areas, transit villages and closed federal military bases. The change is expected to impact the American Dream mall and amusement center at Meadowlands taking shape under developer Triple Five, owners of the Mall of America.
In addition, the legislation also makes several changes to the Urban Hub program by increasing the credit for residential projects from 20 percent to 35 percent of eligible costs over 10 years; providing that affordable housing requirements for an Urban Hub project are to be determined in the sole discretion of the municipality; allowing mixed use projects to receive tax credits for both the residential component and the commercial components of a project; allowing the tax credits to be carried forward for up to 20 years; clarifying existing law that property located within an Urban Hub area, but adjacent to a rail spur for freight rail that is not within an Urban Hub area, is eligible; and providing new standards and procedures for the net benefit analysis for in-state job moves.
Over the course of the last year, the state Economic Development Authority (EDA) has been involved in discussions with developers advancing significant mixed use projects across the state. The goal of the Urban Transit Hub Tax Credit program is promoting vibrant communities where people can work, live and shop, and the changes under the new law are a step forward for revitalization projects.
The Christie administration expects renewed activity in moving them forward. Examples of these projects include the Teachers Village project in Newark, the Gateway project in New Brunswick and Haddon Avenue Transit Village in Camden, each representing projects with investments aimed at providing housing and retail opportunities with commercial components and each leading to significant job creation and private sector investment.
“This is a significant day for Newark and for New Jersey – a day when the state’s urban centers receive a set of supercharged tools to create jobs and kick-start New Jersey’s economy,” Booker said. “The bill Governor Christie signed today is the product of a true bipartisan collaboration.”
Booker said, “In Newark, these incentives will enable crucial development projects to break ground. With credit to our collective efforts to date as well as these new measures, over 25 development projects in Newark will be underway in 2011. That represents over $700 million in total development, producing over 2,500 construction jobs and over 2,500 permanent jobs. Together, these projects will have a transformative impact here in New Jersey’s largest city.”
As part of the 2011-12 state budget, Christie provided $180 million in targeted tax cuts for small businesses in New Jersey to spur job growth and increase business investment and expansion. Among the tax reforms included were: a change in the corporate business tax formula from a three-factor formula to a single sales factor formula; an option for taxpayers to carry forward losses from certain business-related categories of gross incomes for up to two years; a 25 percent reduction in the minimum tax for S-Corporations; a doubling of the research and development credits; and a phase out of the Transitional Energy Facility Assessment (TEFA) by January.
The legislation was sponsored by Senators Raymond Lesniak (D-Union) and Donald Norcross (D-Camden), and Assemblymen Alberto Coutinho (D-Essex), Lou Greenwald (D-Camden) and Jason O’Donnell (D-Hudson).
“Without solid incentives to invest in New Jersey, our economy will continue to stagnate,” Coutinho said. “This law will incentivize developers to invest in our communities that need it most and create jobs for residents who are dying to get back to work. This law is pro-worker, pro-business and pro-community. It’s a win-win-win for everyone.”
“This is about spurring investments in a shaky economy and putting people back to work,” Greenwald said. "This law sends a message to investors that we are not going to sit idly by and pray for our economy to revive itself. Instead, we’re providing the tools to make it happen.”
—TOM HESTER SR., NEWJERSEYNEWSROOM.COM