With the end of New Jersey’s most lucrative tax credit program in sight, Assemblyman Albert Coutinho (D-Newark) said he plans to introduce an upgrade to the state’s package of business incentives in November.
While Coutinho didn’t spell out the details of the legislation last week, he has previously expressed support for expanding the Economic Revitalization and Growth program and for revising the Business Employment Incentive Program.
“My goal would be try to move by the end of the year,” he said.
The BEIP revision could potentially affect other incentive programs, including a proposal that would involve combined multiple incentive programs.
It’s expected the remaining $500 million in Urban Transit Hub tax credits will be allocated in the coming months, including a competitive process for $100 million to support the development of residential transit-hub projects.
Coutinho said he recognized the importance of the state continuing some sort of major incentive program with the end of the transit hub credits nearing. Since every other major incentive program has received a revision — including BEIP’s sister program, the Business Retention and Relocation Assistance Grant program — BEIP is likely a candidate for expansion.
BEIP is one of the most popular and long-standing incentive programs, allowing companies that relocate or expand within the state to receive tax credits. Bonuses are given depending on the location of the BEIP recipients.
The assemblyman said the idea of combining BEIP with multiple major incentive programs was a “radical idea,” but one of several that were under consideration.
Coutinho said whatever the state considers, “it should be more based on jobs and less on capital investment,” like BEIP criteria.
The ERG expansion would target certain sites, and allow them to finance up to 35 percent of eligible costs through future tax receipts, rather than the current cap of 20 percent. This bonus financing would only be available to projects that meet certain criteria set by the state.
While Coutinho had hoped to pass a similar expansion in June, the proposal was delayed as legislators focused attention on the $250 million expansion of the transit hub program.
These proposals could be complicated by the announcement by Sen. Raymond J. Lesniak (D-Union) that no incentive bills will advance for the time being. Lesniak has said the appointment of Gov. Chris Christie’s appointments counsel Michele Brown to head the Economic Development Authority has politicized the agency, which oversees all incentive programs. Lesniak has said that until he’s satisfied the EDA is operating in a nonpartisan manner, all legislation will have to wait.
Coutinho said “it’s going to be a little harder” to advance legislation, but said he would work with Lesniak, the administration and developers. “My role is going to be to continue to work with everybody,” Coutinho said.
Bipartisan support for bill to expand incentives to doctors
While it can be challenging for legislators in the minority caucus to advance bills in New Jersey’s system, Assemblywoman Amy H. Handlin (R-Belford) may have some success in achieving the goal of one of her bills.
Handlin announced a proposal last week to include more small doctor’s offices in the state’s BEIP program.
The proposal received a relatively warm reception from Coutinho, the chairman of the Assembly Commerce and Economic Development Committee, which reviews incentive legislation.
“Any idea where we can help to create more employment or economic development, I’m going to be supportive of,” Coutinho said.
Coutinho said the proposal may be addressed through the legislation that he’s preparing that could revise BEIP and other incentive programs.
“We’ll see if we can address it as we update the incentives,” Coutinho said, adding that he offered to support Handlin “or help her to achieve objectives. It’s an interesting idea, and I’m going to work with her to see if we can get it accomplished.”
Handlin said she was “extremely encouraged” by Coutinho’s interest in the bill’s goal.
“Many of us on both sides of the aisle agree that we need to be creative in using a variety of tools to induce job creation,” she said. “In the case of my bill, what I’ve done is develop a means of accomplishing both an economic goal and a critical public health goal.”
Handlin said she wrote the bill based on discussions with doctors and reading about the state of medicine.
“The landscape of medicine in New Jersey is rapidly changing, mostly in ways that are not promising, because our need for physicians is going to skyrocket in the coming years and we are already experiencing a medical brain drain,” she said. “There is something of a crisis and we can’t wait to address it in a number of ways,” beginning with the bill.
She said Coutinho’s plan to introduce an incentive overhaul in November could be well timed. Coutinho “clearly appreciates that it could potentially contribute something to his package, which would make it that much more timely and that much more beneficial to the state.”
NAIOP cheers conditional veto of remediation fund
Officials with NAIOP New Jersey are pleased with Christie’s conditional veto of a bill that would make changes to a major remediation fund.
The bill, A-2395/S-1246, would have elevated sites in brownfield development areas so that they would receive a higher priority for funding from the Hazardous Discharge Site Remediation Fund.
“NAIOP recommended a conditional veto to the governor for the purposes of making the criteria for grants and loans to be more equitable for projects statewide,” said NAIOP lobbyist Anthony Pizzutillo.
Therefore, commercial developers were pleased to see the veto message, which urged legislators to broaden the number of sites eligible for funding.
“This proposal, crafted with advice from the Department of Environmental Protection and the Economic Development Authority, which co-administer the fund, as well as input from the development community, will ensure the fund’s long-term financial viability, and the continued investigation, remediation and cleanup of contaminated sites throughout the state,” Christie wrote in his message.
Pizzutillo said developers were hopeful that legislators would incorporate Christie’s proposed changes and pass the bill again.