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  • NJ A2461
  • Concerns reviews of State's economic development incentives.
Introduced
(2/4/2016)
In Committee
(2/4/2016)
Crossed OverPassedSignedDead/Failed/Vetoed
2016-2017 Regular Session
This bill provides for the periodic review of certain economic development incentive programs administered by the New Jersey Economic Development Authority (authority). The purpose of the bill is to expand upon current reporting requirements of authority programs to allow the Legislature to independently evaluate the effectiveness of New Jersey's economic development incentives. The bill requires the State Auditor to conduct an audit of each authority program that provides a private business with a grant, loan, or tax credit every two years, and to publish a report on the audit. The bill requires the audit and report to describe each authority program that provides or provided a grant, loan, or tax credits to a private business after December 31, 2006, and to include the following information regarding each grant, loan, or tax credit in excess of $1,000 that the authority awarded after December 31, 2006 to a private business: (1) the name of the private business that received the grant, loan, or tax credit; (2) the amount of the grant, loan, or tax credit; (3) a detailed description of any development project that the private business was required to complete in exchange for the grant, loan, or tax credit and the status of the project; (4) the amount of any investment, in excess of the funds provided by the State, that the authority required the private business to make in exchange for the grant, loan, or tax credit and the amount invested by the private business; (5) the number of jobs that the private business promised to create, retain, or relocate within the State in exchange for the grant, loan, or tax credit and the number of those jobs that were to be permanent or temporary; (6) the actual number of jobs that the private business created, retained, or relocated within the State as the direct or indirect result of the grant, loan, or tax credit, whether those jobs were temporary or are permanent, whether those jobs still existed in this State at the conclusion of the reporting period, or at the conclusion during the reporting period of the term of any contract or agreement between the authority and the business, under which contract or agreement the grant, loan, or tax credit was awarded, and the salary and benefits provided during the reporting period to the individuals who have filled those jobs; (7) the total number of individuals employed by the private business in this State on the day it received the grant, loan, or tax credit, the total number of individuals employed by the private business in this State at the conclusion of the reporting period or at the conclusion during the reporting period of any contract or agreement referred to in paragraph (6) above, and whether the private business has engaged in any layoffs in this State since its receipt of the grant, loan, or tax credit; (8) the amount of additional tax revenue, on an annual basis for each year since the grant, loan, or tax credit was issued, attributable to increases in the private business's net income, sales, or workforce as the direct or indirect result of its receipt of the grant, loan, or tax credit, including, but not limited, to additional income tax withholdings from an employee in a job created by the grant, loan, or tax credit; and (9) the use of a provision of law by the authority to recapture or reduce the benefits of any grant, loan, or tax credit awarded to a private business. The bill provides for the report to include a summary of the findings of the preparers of the report, and to detail any trends, positive or negative, that could be utilized to improve the State's return on the economic development incentives provided to private businesses. The bill stipulates that the report is to highlight any information the preparers of the report were unable to obtain through the authority as well as any recommended legislative changes that would allow the authority to collect and provide that information. The bill authorizes the State Auditor to contract with an independent private entity to prepare an audit and report, or part thereof. If the State Auditor contracts with an independent private entity, the bill requires the State Auditor to award the contract to an entity that has at least 10 years' experience in the preparation of financial and performance audits of governmental units, and requires the contract to mandate that the audit be conducted in accordance with generally accepted government auditing standards used by the Government Accountability Office. In addition, the bill establishes the "Legislative Task Force on Business Development Incentives" to study the effectiveness of the authority's business development and retention incentives. The bill provides for the task force to be comprised of 14 legislators: (1) the chairpersons of the Senate Economic Growth Committee, the Senate Labor Committee, the Senate Budget and Appropriations Committee, the Assembly Commerce and Economic Development Committee, the Assembly Labor Committee, and, at the discretion of the Speaker of the General Assembly, either the Assembly Appropriations Committee or the Assembly Budget Committee, or their respective successors; (2) a member of each of those committees, appointed by the presiding officer of the House, based upon the recommendation of the minority leader of that House; and (3) the Majority Leader of the Senate and the Majority Leader of the General Assembly. The bill directs the task force to hold at least one public hearing on the State Auditor's report, and to issue its own report that makes recommendations for revising or discontinuing any existing authority program to improve the State's return on the economic development incentives provided through the authority to private businesses. The bill takes effect on July 1 next following the date of enactment.
Commerce and Economic Development
Introduced, Referred to Assembly Commerce and Economic Development Committee  (on 2/4/2016)
 
 

Date Chamber Action Description
2/4/2016 A Introduced, Referred to Assembly Commerce and Economic Development Committee
Date Motion Yea Nay Other
None specified