Bill > A4199

Introduced Session

This bill expands the "Urban Transit Hub Tax Credit Act" ("UTHTCA") and the "New Jersey Economic Stimulus Act of 2009" ("Stimulus Act") to include certain mixed use projects as creditable investments and to change the manner in which the tax credits under the UTHTCA are treated by eligible businesses. Under the UTHTCA, a business may receive tax credits of up to 100 percent of its qualified capital investment in a business facility that (1) is located in an urban transit hub (i.e., an "urban aid" municipality, served by a commuter rail station, in which at least 30 percent of real property value is exempt from property taxes), and (2) employs at least 250 persons at the facility. Annually for ten years, the business may apply a credit equal to 10 percent of the amount of the investment against corporation business tax, insurance premiums tax or gross income tax liability. A tenant in these qualified business facilities may also be allowed credits, if the tenant occupies space in the facility that proportionally represents at least $17,500,000 of the capital investment in the facility and employs at least 250 persons in the facility. For a business or a tenant to be eligible for the credit, the owner of the facility has to have made or acquired capital investments in the facility of not less than $50 million. Under a separate but similar urban transit hub tax credit program enacted as part of the Stimulus Act, a developer may receive tax credits of up to 20 percent of its capital investment in a qualified residential project located in an urban transit hub, subject to the same $50 million project investment requirement applicable to a qualified business facility. This bill extends eligibility to participants for these credits of up to 35 percent of its capital investment in a mixed use project comprising both a qualified business facility and a qualified residential project, neither of which by itself satisfies the total investment minimum of $50 million, so long as (1) the investment in the component of the mixed use project for which the participant seeks credit amounts to at least $17.5 million, and (2) the total amount invested in the mixed use project as a whole is at least $50 million. The bill also provides that, for purposes of UTHTCA, a mixed use projects business component must employ 250 full-time employees to qualify. Additionally, the bill makes changes to the UTHTCA to allow businesses receiving tax credits under the UTHTCA to (1) carry forward the credits into no more than 20 subsequent tax accounting or privilege periods and limit the amount allowed in any fiscal year to $150 million, and (2) increase from 20 to 35 percent the proportion of the cost of capital invested in a qualified residential project located within an urban transit hub that a developer could receive as a tax credit. The bill clarifies the definition of "urban transit hub" so that businesses may utilize any rail spur located adjacent to or within a one mile radius surrounding the entrance to property for loading and unloading freight cars on trains. The bill prohibits the New Jersey Economic Development Authority ("EDA") from treating the relocation of a job within the State as a factor in making its determination of whether a capital investment would yield a net positive benefit to the State, unless the business proposes to transfer existing jobs as part of a consolidation of business operations from two or more locations and municipalities. The determination of a net positive benefit by the EDA shall not apply to any applications submitted to the EDA on or before June 22, 2011. Currently, the EDA considers a job that will be relocated within the State as a new job and therefore, creating a benefit. Finally, for the purposes of mixed use projects or qualified residential projects where a business receives an urban transit hub tax credit, the bill allows eligible municipalities under the UTHTCA to determine the amount of the percentage, up to 20 percent of the total, of newly-constructed residential units set aside for occupancy by low or moderate income households within an urban transit hub.

AI Summary

Committee Categories

Albert Coutinho (D)*, 

Introduced, Referred to Assembly Commerce and Economic Development Committee (on 06/27/2011)

Official Document