TRENTON – A bipartisan bill sponsored by state Sen. Raymond J. Lesniak (D-Union) which creates the “Grow New Jersey” program to provide tax incentives for companies which maintain existing employment levels and create new jobs in New Jersey was signed into law today by Governor Christie.
“While we’re finally starting to see a federal rebound from record high unemployment, we have to do more in New Jersey to ensure that, as we recover nationally, that New Jersey residents have opportunities to get out of joblessness and into well-paying jobs,” said Lesniak, who fought to have job creation – and not just job retention – included in the bill to move New Jersey’s economic recovery forward. “The Grow New Jersey tax credit represents an innovative approach to spur economic activity and recovery, and will encourage businesses to expand in the Garden State. This is the latest tool to help reshape our State’s economic climate and expand our job market, and I look forward to seeing the Grow New Jersey tax credit program in action.”
The new law, S-3033, establishes the “Grow New Jersey” tax credit business incentive program to stimulate economic investment and private job creation. Under the program, businesses in qualifying development zones will 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 will 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 to participate in the program. Finally, the business will have to demonstrate to the New Jersey Economic Development Authority (EDA) that the tax credit will yield a net positive benefit for the state.
Under the “Grow New Jersey” program, qualifying businesses will 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. Under amendments approved by the Assembly, businesses will be capped in the amount of Grow New Jersey tax credits they could apply to their annual tax responsibility – either one-tenth of their capital investment or $4 million, whichever is less.
Lesniak added that the EDA will 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 will 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 will forfeit their credits if it does not maintain an 80 percent job retention standard, employs 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 will create jobs and will also encourage businesses to invest more in areas in need of redevelopment, including abandoned corporate properties,” said Lesniak, who serves as Chairman of the Senate Economic Growth Committee. “The idea of this law is to help create jobs for unemployed New Jersey residents, but we can also encourage capital improvement and investment, in order to put decaying corporate facilities back on the tax rolls and contribute to the economic recovery of our communities.”
The bill was approved by both the Senate and Assembly last month, with the Senate approving it by a vote of 37-0, and the Assembly approving it by a vote of 60-2-4.
Connect with NJTODAY.NET
Join NJTODAY.NET's free Email List to receive occasional updates delivered right to your email address!