Bill > S107

Introduced Session

This bill establishes a loan program and provides tax credits to persons for the establishment of new vineyards and wineries in eligible counties. The bill defines an eligible county as a county of the third class with a population greater than 150,000 according to the latest federal decennial census, a county of the fifth class, or a county of the sixth class, and that contains at least three wineries. The bill requires the New Jersey Economic Development Authority (authority), in consultation with the Department of Agriculture (department), to develop a 10-year pilot program to provide low interest loans to farmers for qualified costs associated with the installation of new vineyards in eligible counties. Qualified costs include the cost of preparing land for plant installation, purchasing vines or trees, and purchasing equipment and supplies for those purposes. It does not include the cost of tractors, pick-up-trucks, or wine-making equipment. A loan may cover up to 100 percent of the applicant's qualified costs, would bear interest of not more than five percent per year, and would be for a term of not more than 10 years. The loan would be made pursuant to a loan agreement with the authority, which would contain terms and conditions deemed appropriate by the authority. The bill permits the authority to require a person that receives a loan to submit an audited financial statement to the authority in order to ensure the continued viability of the person's farming operation, and may, either by regulation or through the terms and conditions of the loan agreement, establish terms and conditions governing the incidence of default by a person that receives a loan. The authority would be required to submit a report, annually, to the Governor and the Legislature summarizing each loan made pursuant to the bill, and detailing the effectiveness of the pilot program in increasing the acreage of commercial vineyards in eligible counties. The bill also allows eligible taxpayers to apply for a tax credit against either their corporation business tax or gross income tax liability in an amount equal to 25 percent of the qualified capital expenses incurred by taxpayers in connection with: (1) the establishment of a new vineyard or winery in an eligible county; or (2) capital improvements made to an existing vineyard or winery in an eligible county. A qualified capital expense is any expenditure made by the taxpayer for the purchase and installation of equipment or agricultural materials for use in the production of agricultural products at a vineyard or in a winery, as specified in regulations. An eligible taxpayer may apply to the department for the approval of a tax credit for a tax year beginning on or after January 1, 2023 but before January 1, 2033. To obtain a tax credit under the bill, a taxpayer is required to apply for a certification from the department that certifies: (1) that the taxpayer's expenses are qualified capital expenses and (2) the amount of the tax credit. Upon certification, the Secretary of Agriculture (secretary) would submit a copy of the application to the taxpayer and the Director of the Division of Taxation. When filing a tax return that includes a claim for a credit under the bill, a taxpayer would include a copy of the certification issued by the secretary. Credits would be valid in the privilege period or taxable year in which the certification is approved, and any unused portions could be carried forward into the next 15 privilege periods or taxable years. The secretary would be required to issue a report to the Governor, State Treasurer, and the Legislature, annually, on the effectiveness of the tax credit in increasing the acreage of commercial vineyards and the number of wineries in eligible counties.

AI Summary

Committee Categories

Jim Beach (D)*,  Nilsa Cruz-Perez (D)*, 

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

Official Document