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Grapevine: Incentives could fuel building

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Supersized tax credits may be largely disappearing under a planned overhaul of the state's business incentives, as lawmakers shift the focus to rewarding job creation. But one insider said there might still be a place for awards that spur major capital investments.

The source said that depends on whether New Jersey wants to attract industries like biofuel production, which has cropped up extensively in California, with companies that convert materials like algae into new fuel sources. But such companies have also been seeking lower-cost states to build their high-cost facilities.

That may cause lawmakers to consider tweaking the definition of a "mega project" under legislation that would revamp New Jersey's incentives, the person said, giving the state the ability to provide the types of outsized awards that have been criticized under the current Urban Transit Hub program, but are needed for industries with soaring infrastructure costs.

"The question is, do you want that company?" the source said. "If you want something that's really cost-prohibitive to build — a nuclear power plant, a biofuels plant or something like that — you're really going to have to ramp up the numbers."

The person also said underwriting such costly build-outs would be key to creating new industry clusters in the Garden State.

Business and development advocates have watched anxiously in recent months as lawmakers fine-tune bills that would reshape the state's incentives offerings. The proposals, which would consolidate five programs into two, expand eligibility and put more emphasis on job creation, are awaiting additional hearings in the Legislature.

Don't do casinos in ads

The Sandy relief plan approved by the U.S. Department of Housing and Urban Development last week includes $25 million for a tourism marketing campaign. But the highly anticipated marketing push won't include one of the Jersey Shore's traditional selling points — Atlantic City's casinos.

Michele Brown said last week that federal regulations bar the state from using federal dollars to promote gambling.

"So, I promise you, you will see no photo of any casino in anything that we're doing," said the chief executive of the Economic Development Authority.

Brown's agency is overseeing the $25 million contract, which was awarded to MWW, which will handle public relations, and Brushfire Inc., which will handle the ads. She said EDA will be working in conjunction with the state Division of Travel and Tourism and the Atlantic City Alliance to ensure the three marketing campaigns have consistent messaging.

That message: Despite Sandy, the vast majority of the Jersey Shore is open for business this summer.

The omission of casinos from the federally funded campaign doesn't necessarily conflict with the marketing philosophy employed by Atlantic City since the state takeover two years ago. Officials famously sought to rebrand the city not as a gaming hub, but as an entertainment resort.

However, in April, the ACA announced it would reverse course and highlight casinos in the second iteration of its well-received "Do AC" campaign.

While the new federally funded campaign won't be able to follow suit, Brown said that doesn't mean they can't promote the city itself.

"We can promote Atlantic City," she said. "We simply can't promote the casino industry."

Grapevine reports on the behind-the-scenes buzz in the business community. Contact Editor Sharon Waters at sharonw@njbiz.com.

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