Bill > S1374

Introduced Session

The bill provides a tax credit under the corporation business tax and the gross income tax for certain costs associated with the demolition of an abandoned commercial building and the construction of a new commercial building in its place. As defined by the bill, "commercial building" means a building of at least 100,000 square feet that is used for commercial purposes. Specifically, the bill allows a taxpayer who replaces an abandoned commercial building in the State by demolishing the abandoned commercial building and constructing a new commercial building in the same location to receive a corporation business tax credit and gross income tax credit. The amount of the tax credits provided by the bill may not exceed the lesser of: (1) 25 percent of the total costs incurred by the taxpayer associated with the demolition of the abandoned commercial building and the construction of the new commercial building, or (2) $500,000. To qualify for a tax credit allowed under the bill, a taxpayer would be required to apply to the Division of Taxation in the Department of the Treasury (division) for a certification that provides: (1) that the demolition of the abandoned commercial building and the construction of the new commercial building meet the requirements of the bill; and (2) the amount of the tax credit. The application would be required to demonstrate that the abandoned commercial building was demolished, and that a new commercial building was constructed in its place, prior to applying for the tax credit. The bill requires the division to adopt rules and regulations as are necessary to implement the bill's provisions. The bill would also limit the cumulative total of tax credits awarded pursuant to the bill to $5 million. Finally, the bill would require, no later than one year after the expiration of the tax credits provided pursuant to the bill, the division to prepare and submit to the Governor, the State Treasurer, and the Legislature a report that, at a minimum, summarizes the effectiveness of the tax credit in incentivizing the replacement of abandoned commercial buildings with newly constructed commercial buildings. Construction of commercial buildings throughout the State has increased exponentially during recent years. Many commercial buildings have been constructed on the State's farmland, which has adversely impacted the State's farming sector. Construction of commercial buildings on farmland decreases the amount of land in the State that is able to be used for farming purposes and, in many cases, destroys prime soil, which is limited to areas where the soil naturally occurs and, once destroyed, cannot be recreated. Farmland is an important economic and environmental resource for New Jersey and, for this reason, it is important take steps to ensure farmland is used for farming purposes and not converted into commercial buildings. Lands currently used for commercial purposes should continue to be used for commercial purposes. For this reason, abandoned commercial buildings should be replaced with newly constructed commercial buildings at the same location. This bill would encourage the development of commercial buildings throughout the State while also protecting the State's farmland.

AI Summary

Committee Categories

Nilsa Cruz-Perez (D)*,  Mike Testa (R)*,  Owen Henry (R), 

Introduced in the Senate, Referred to Senate Economic Growth Committee (on 01/09/2024)

Official Document