TRENTON – The state Senate today approved the “Urban Transit Hub Tax Credit Act,” a bill sponsored by Senate President Richard J. Codey (D-Essex), which is aimed at catalyzing economic development in areas surrounding urban train stations. The act is designed to foster smart growth principles and would establish a tax credit program for capital investment and increased employment in targeted transit hubs.
“This bill will help break the logjam that often occurs in urban redevelopment and stimulate sizeable job growth,” said Sen. Codey. “Sometimes, despite the best efforts of a municipality, it’s just impossible to attract investors to a property if they don’t see the potential for profit. That’s sound business sense on their part. This is sound public policy on our part.”
The bill directs the New Jersey Commerce Commission to designate areas in a narrow one-half mile radius around the rail stations (not including rail stations at international airports) as an “urban transit hub” in which qualifying business facility investment and employment must be located. The aim is to foster development that does not rely on auto travel, but rather rail and pedestrian modes of transportation.
A business that makes $75,000,000 of qualified capital investment in a facility in an urban transit hub and employs at least 250 people at that facility, may qualify for tax credits equal to 100 percent of the qualified capital investment that may be applied against corporation business tax, insurance premiums tax or gross income tax liability. The taxpayer may utilize a credit equal to 10 percent of the qualified capital investment annually for ten years.
A tenant in these qualified business facilities may also be allowed credits, if the tenant occupies space in a qualified business facility that proportionally represents at least $25,000,000 of the capital investment in the facility and employs at least 250 persons in that facility.
The program is limited to investment and employment in municipalities that have a specified commuter rail station and are eligible for urban aid and have at least 30 percent of their real property value exempt from property taxes. Sen. Codey noted that presently, nine municipalities would qualify for the credit: Camden, East Orange, Elizabeth, Jersey City, Newark, New Brunswick, Paterson, and Trenton, and Hoboken.
Sen. Codey also stressed the reasoning behind this is that these areas already have existing infrastructure that can accommodate additional population growth and high intensity commercial uses or high density residential development.
“I am delighted that this legislation will provide enormous economic incentives to businesses investing in urban centers. Communities like Jersey City will greatly benefit from this measure. It lays a solid foundation for economic growth that I look forward to building upon in the next legislative session,” said Senator Sandra B. Cunningham (D-Hudson) who represents Jersey City, one of the municipalities that would benefit from this legislation.
The Assembly is also expected to act on the bill today and, if approved, it would head to the Governor who is expected to sign it into law.
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