TRENTON – Senators Jeff Van Drew and Nicholas J. Sacco said the cut to the Urban Enterprise Zone program, which the Senate failed to override today, will harm economic development efforts from the northern to the southern end of the state.
“This program has proven successful in stimulating economic development in designated urban enterprise zones, from shore towns at the southern end of the state to bustling cities in the north,” said Senator Van Drew (D-Cape May/Cumberland/Atlantic). “It is extremely disappointing that we were unable to restore funding to these communities, many which are struggling to maintain services and jobs in an extraordinarily difficult economy. I want to make clear that this is not a Republican or Democratic program; it is a program that serves as an economic engine to benefit the whole state.”
“This program has been used to jump-start economic development projects in our downtowns, to create thousands of jobs in our communities, and to reinvent shopping districts across New Jersey,” said Senator Sacco (D-Hudson/Bergen). “With the economy still recovering from the worst recession in decades, this is the wrong time to abandon our most challenged municipalities. The failure of our colleagues to support a restoration of UEZ funding is not only a setback for the economic future of these municipalities; it’s a setback for the entire state.”
The resolution sponsored by the senators, SCR-217, would have overridden the governor’s line-item veto of language provisions in the FY2012 budget concerning the allocation and use of sales tax revenue generated in Urban Enterprise Zones. Specifically, it would have restored to UEZ communities half of the $94 million the governor diverted into the general fund. The $47 million would have gone to the 32 UEZs operating in 37 municipalities for the purpose of economic development.
This is the second consecutive year that UEZ revenues have been diverted in their entirety from the zones to the general fund. A total of $89 million in UEZ sales tax revenues was anticipated to be diverted to the State’s General Fund in FY 2011. In addition, in the spring of 2010, Governor Christie transferred $58 million in undesignated fund balances from the Urban Enterprise Zone Fund to the State General Fund as part of a host of actions taken to close a $2.2 billion deficit in the FY 2010 budget.
The override attempt failed on a party-line vote of 24-13.