Garden State Growth Zones

Incentive Alert: Legislation Introduced to Amend and Extend the Grow NJ Program

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On November 26, 2018, Assemblywoman Eliana Pintor Marin introduced legislation to amend and extend the Grow New Jersey Assistance Program (“Grow NJ”). Among the changes to the current program, the bill provides certain reductions and expansions to the ability of a business to qualify for tax credits under the program, including new limits on the size of awards for new and retained jobs, and an extension of the deadline to apply for tax credits to July 2023 (the Grow NJ program is currently set to expire in July 2019).

Created under the Economic Opportunity Act of 2013, the Grow NJ program has been wildly popular and incredibly successful. Since its implementation, 250 projects have received awards, totaling over $4.7 billion in tax credits. Approved applicants generally have three years to certify, or complete, a project. A project is deemed complete when the applicant has hired or retained the number of employees listed in its application, and satisfied the program’s capital investment requirements. Once certified, the 250 projects will drive over $4.5 billion in private capital investment, create over 32,000 new jobs, and retain over 35,000 jobs at risk of leaving the State.

The full text of the legislation can be found here: https://www.njleg.state.nj.us/2018/Bills/A5000/4730_I1.PDF

If interested in learning more about Grow NJ or any other economic incentive program, please do not hesitate to contact Chris Murphy at (973) 877-6984 or cmurphy@murphyllp.com.   

MURPHY PARTNERS LLP

Murphy Partners LLP is a boutique law firm specializing in real estate, development, and economic incentive advisory. With offices in Newark, New Jersey and New York City, the firm was founded to provide effective, efficient, and creative legal services to meet the distinctive needs of our clients. Through the development of comprehensive legal strategies, our team works tirelessly to create a blueprint for success and advance our clients’ interests in every matter.


New Jersey Incentive Update - November 2018

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This morning, the New Jersey Economic Development Authority (NJEDA) will hold its monthly board meeting. Among the actions to be taken, the Board will adopt new rules for the Film & Digital Media Tax Credit Program, and consider three applications under the Grow New Jersey Assistance Program (Grow NJ).

Created by legislation passed earlier this year, the Film & Digital Media Tax Credit Program will allow for taxpayers (in most cases, production companies) to seek a tax credit for qualified film production and digital media content production expenses. Applications will be approved by the New Jersey Economic Development Authority (NJEDA) and the Director of the Division of Taxation in the Department of the Treasury. Approved applicants are entitled to claim a credit against CBT or GIT liability in an amount equal to 30 percent (35 percent in limited cases) of the qualified film production expenses or 20 percent (25 percent in limited cases) of the qualified digital media content production expenses.

Created under the Economic Opportunity Act of 2013, the Grow New Jersey Assistance Program (Grow NJ) is the State’s main job creation and retention incentive program. Under the Grow NJ program, businesses creating or retaining jobs in the State may be eligible for tax credits ranging from $500 to $5,000 per job, per year; with bonus credits ranging from $250 to $3,000 per job, per year (awards vary based on applicable criteria).

The Grow NJ program has been wildly popular and incredibly successful. Since its implementation, 250 projects have received awards, totaling over $4.7 billion in tax credits. Approved applicants generally have three years to certify, or complete, a project. A project is deemed complete when the applicant has hired or retained the number of employees listed in its application, and satisfied the program’s capital investment requirements. Once certified, the 250 projects will drive over $4.5 billion in private capital investment, create over 32,000 new jobs, and retain over 35,000 jobs at risk of leaving the State.

If interested in learning more about these programs, please do not hesitate to contact Chris Murphy at (973) 877-6984 or cmurphy@murphyllp.com.  

MURPHY PARTNERS LLP

Murphy Partners LLP is a boutique law firm specializing in real estate, development, and economic incentive advisory. With offices in Newark, New Jersey and New York City, the firm was founded to provide effective, efficient, and creative legal services to meet the distinctive needs of our clients. Through the development of comprehensive legal strategies, our team works tirelessly to create a blueprint for success and advance our clients’ interests in every matter.


Incentive Alert: Rutgers University Report Recommends Changes to New Jersey’s Business Incentive Programs

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On Wednesday, the New Jersey Economic Development Authority (NJEDA) submitted a report to Governor Phil Murphy, conducted by Rutgers University’s Edward J. Bloustein School of Planning and Public Policy, which (among other things) recommended changes to the State’s business incentive programs, including the Grow New Jersey Assistance Program (Grow NJ) and the Economic Redevelopment and Growth Grant Program (ERG).

The report (which can be found here) found the following:   

  • There has been a significant volume of project approvals under Grow NJ, which are associated with significant volumes of retained and created jobs, but which will also generate a substantial offset to the Corporate Business Tax and Insurance Premium Tax in the years ahead;

  • Commercial ERG projects leverage a considerable amount of private investment.

  • Given the long lead time associated with Grow NJ and ERG projects, it is too soon to fully evaluate the impact of these programs on the State’s economy;

  • Projects approved under Grow NJ are generally concentrated in the northern, more populous counties of the State. A significant percentage of project funding in the eight southern counties has been concentrated in Camden;

  • Redundancies in the Grow NJ base and bonus award structure are potentially providing more generous incentives than intended by the statute;

  • Because certain bonuses have been underutilized, it is not clear that the program has advanced certain policy goals intended by the legislation such as clean energy investment and the creation of incubators;

  • There is an opportunity to improve EDA’s analysis of proposed incentive projects.

The report suggested the following to improve the programs:

  • A deeper analysis of the types and quality of jobs created or retained, and whether some or all of the related economic activity would have happened with lower or no incentives.

  • A review of the overall impact of the reduction in Corporate Business Tax revenues (which would be made up for by higher Gross Income Tax from created or retained jobs), given the constitutional requirement that the Gross Income Tax fund property tax relief while the Corporate Business Tax and Insurance Premium Tax are the primary resources for the General Fund.

  • Given the Grow NJ program’s goals of job creation and retention, the report recommends that the alternative approach used in calculating certain awards in the city of Camden (the “Camden alternatives”) be revised to tie awards more closely to the employment created by these firms.

  • NJEDA should consider eliminating or revising the bonus for Transit Oriented Development in Urban Transit Hubs and Garden State Growth Zones. This bonus may be redundant in most cases in these jurisdictions, where it accounts for about 21 percent, or about $250 million of the total award value for projects qualifying for the bonus.

The programs are currently set to expire in July 2019. With the sunset of the programs only a year away, legislators will soon start to discuss potential changes to the programs. While change may be on the horizon, one thing is clear--incentives will continue to be part of New Jersey’s economic development toolkit.

If interested in learning more about state and local incentives, please do not hesitate to contact Murphy Partners LLP at (973) 877-6984 or info@murphyllp.com.  

MURPHY PARTNERS LLP

Murphy Partners LLP is a boutique law firm specializing in real estate, development, and economic incentive advisory. With offices in Newark, New Jersey and New York City, the firm was founded to provide effective, efficient, and creative legal services to meet the distinctive needs of our clients. Through the development of comprehensive legal strategies, our team works tirelessly to create a blueprint for success and advance our clients’ interests in every matter.

New Jersey Incentive Update - June 2018

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On Tuesday, June 12, 2018, the New Jersey Economic Development Authority (NJEDA) will hold its monthly board meeting. Among the actions to be taken, the Board will consider two applications under the Grow New Jersey Assistance Program (Grow NJ). If approved, the two applicants could receive over $60,000,000 in tax credits (over 10 years).

Created under the Economic Opportunity Act of 2013, the Grow New Jersey Assistance Program (Grow NJ) is the State’s main job creation and retention incentive program. Under the Grow NJ program, businesses creating or retaining jobs in the State may be eligible for tax credits ranging from $500 to $5,000 per job, per year; with bonus credits ranging from $250 to $3,000 per job, per year (awards vary based on applicable criteria).

The Grow NJ program has been wildly popular and incredibly successful. Since its implementation, 252 projects have received awards, totaling over $4.7 billion in tax credits. Approved applicants generally have three years to certify, or complete, a project. A project is deemed complete when the applicant has hired or retained the number of employees listed in its application, and satisfied the program’s capital investment requirements. Once certified, the 252 projects will drive over $4.5 billion in private capital investment, create over 30,000 new jobs, and retain over 36,000 jobs at risk of leaving the State.

If interested in learning more about Grow NJ or other economic development incentive programs, please do not hesitate to contact Murphy Partners LLP at (973) 877-6984 or info@murphyllp.com. 

MURPHY PARTNERS LLP

Murphy Partners LLP is a boutique law firm specializing in real estate, development, and economic incentive advisory. With offices in Newark, New Jersey and New York City, the firm was founded to provide effective, efficient, and creative legal services to meet the distinctive needs of our clients. Through the development of comprehensive legal strategies, our team works tirelessly to create a blueprint for success and advance our clients’ interests in every matter.

Incentive Alert: New Rules Under the Grow NJ Program Encourage Collaborative Research Relationships Between Industry and Academia

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The New Jersey Economic Development Authority (“NJEDA”) has established new standards under the Grow New Jersey Assistance Program (“Grow NJ”) for businesses seeking to enter into collaborative relationships with colleges and universities in the State of New Jersey.

The new rules were drafted pursuant to a recently passed amendment to the Grow NJ program (ACS for A-4432/SCS for S-2841), with the hopes of encouraging businesses to enter into such collaborative research relationships.

Under the new rules, businesses may qualify for a base tax credit amount of $5,000 per job, per year, if the business locates a qualified business facility (“QBF”) in a Garden State Create Zone, and the facility is used by the business in a targeted industry to conduct a collaborative research relationship with that university.

A Garden State Create Zone is defined as the campus of a doctoral university, and the area within a three-mile radius of the outermost boundary of the campus of a doctoral university. The State currently has 8 doctoral universities, including Montclair State University, NJIT, Princeton University, Rowan University, Rutgers University-New Brunswick, Rutgers University-Newark, Seton Hall University, and Stevens Institute of Technology.

In addition, the new rules establish a bonus of $1,000 per job, per year, if a business (1) is in a targeted industry and locates in a QBF on, or within three miles of, the campus of a college or university other than a doctoral university, and (2) the facility is used by the business to conduct a collaborative research relationship with the college or university. The State currently has 40 non-doctoral colleges and universities (including community colleges) that qualify under this bonus category.

The NJEDA will evaluate prospective research partnerships based on the ability to meet one of four categories:

  • Direct university collaboration or joint initiative or participation wherein the college or university partners with the business, and may include other business in a similar field of science, to advance an area of science;

  • Sponsored research wherein the eligible business directly funds a college or university and pays for research to solve a specific problem;

  • Grants or fellowships wherein funding is provided directly by a business to a professor or graduate student to advance a specific area of science;

  • Corporate sponsored awards for entrepreneurship wherein a business sponsors an award to be given to a student-developed technology startup or innovation

Created under the Economic Opportunity Act of 2013, Grow NJ is the State’s main job creation and business retention incentive program. The purpose of the program is to encourage economic development and job creation and to preserve jobs that currently exist in New Jersey but which are in danger of being relocated outside of the State.

The Grow NJ program has been wildly popular and incredibly successful. Since its implementation, 232 projects have received awards, totaling over $4.4 billion in tax credits. Approved applicants generally have three years to certify, or complete, a project. A project is deemed complete when the applicant has hired or retained the number of employees listed in its application, and satisfied the program’s capital investment requirements. Once certified, the 232 projects will drive over $3.9 billion in private capital investment, create over 28,000 new jobs, and retain over 30,000 jobs at risk of leaving the State.

If interested in learning more about Grow NJ or other economic development incentive programs, please do not hesitate to contact Murphy Partners LLP at (973) 723-7036 or info@murphyllp.com.

MURPHY PARTNERS LLP

Murphy Partners LLP is a boutique law firm specializing in real estate and economic incentive advisory. Headquartered in Newark, New Jersey, the firm was founded to provide effective, efficient, and creative legal services to meet the distinctive needs of our clients. Through the development of comprehensive legal strategies, our team works tirelessly to create a blueprint for success and advance our clients’ interests in every matter.

Incentive Alert: Amendments to the Grow NJ Program Advance

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On Tuesday, multiple bills to amend the Grow New Jersey Assistance Program (Grow NJ) received favorable committee votes in Trenton. The Assembly Commerce and Economic Development Committee voted 9-0 to amend provisions related to the classification of Garden State Growth Zones (GSGZ) under the program. The committee also approved a bill which would require the New Jersey Economic Development Authority (NJEDA) to establish an “innovation zone” program, and modify the Grow NJ program to provide bonuses and other enhanced incentives to high-technology businesses located in an innovation zone.

Under A-4510, the Grow NJ program would be amended to add a sixth GSGZ, which will include the Atlantic City International Airport and the Federal Aviation Administration William J. Hughes Technical Center, and the area within a one-mile radius of the outermost boundary of that airport and technical center.

Currently, there are five GSGZs, including Atlantic City, Camden, Passaic, Paterson, and Trenton. Businesses relocating to or remaining in a GSGZ receive enhanced incentives, including a base tax credit of $5,000 per job, per year, for up to 10 years.

In addition to creating an additional GSGZ, the amendment also allows projects located in the six GSGZs to take advantage of provisions only available for projects located in Camden, including an alternative grant calculation to determine the total incentive amount available. This provision has driven many of the program’s largest projects (and awards) to Camden. As amended, all six GSGZs would be entitled to the same benefits.

The Assembly Commerce and Economic Development Committee also voted 7-0 to approve A-3747, which would require the NJEDA to establish an "innovation zone" program, which would consist of three innovation zones, each surrounding a research university or college or research hospital, and located in Greater Camden, Greater New Brunswick, and Greater Newark. The bill would require the NJEDA, with the approval of the State Treasurer, to modify its existing business assistance programs to give bonuses or other enhanced incentives to high-technology businesses located in an innovation zone.

Created under the Economic Opportunity Act of 2013, Grow NJ is the State’s main job creation and retention incentive program. Under the program, businesses creating or retaining jobs in the State may be eligible for tax credits ranging from $500 to $5,000 per job, per year; with bonus credits ranging from $250 to $3,000 per job, per year (awards vary based on applicable criteria).

The Grow NJ program has been wildly popular and incredibly successful. Since its implementation, 232 projects have received awards, totaling over $4.4 billion in tax credits. Approved applicants generally have three years to certify, or complete, a project. A project is deemed complete when the applicant has hired or retained the number of employees listed in its application, and satisfied the program’s capital investment requirements. Once certified, the 232 projects will drive over $3.9 billion in private capital investment, create over 28,000 new jobs, and retain over 30,000 jobs at risk of leaving the State.

If interested in learning more about Grow NJ or other economic development incentive programs, please do not hesitate to contact Murphy Partners LLP at (973) 723-7036 or info@murphyllp.com.  

MURPHY PARTNERS LLP

Murphy Partners LLP is a boutique law firm specializing in commercial real estate and economic incentive advisory. Headquartered in Newark, New Jersey, the firm was founded to provide effective, efficient, and creative legal services to meet the distinctive needs of our clients. Through the development of comprehensive legal strategies, our team works tirelessly to create a blueprint for success and advance our clients’ interests in every matter.