This afternoon, the Senate Budget and Appropriations Committee quickly amended and approved a new, complex, and technical 68-page bill (S4175/A5833) that would further roll back requirements on the Aspire tax subsidy program for big developers administered by the New Jersey Economic Development Authority (NJEDA). Despite already loosening requirements in the June budget session six months ago and with regulations from those changes just recently approved, the Legislature is nonetheless fast-tracking even more changes that would benefit developers at the expense of the communities and families these projects are supposed to benefit. In response to the bill being fast-tracked in the final weeks of the legislative session, New Jersey Policy Perspective (NJPP) releases the following statement.
Peter Chen, Senior Policy Analyst, NJPP:
“This is another last-minute lame-duck special that will benefit big developers at the expense of everyone else. These changes would turn a tax credit program aimed at revitalizing communities into one that funds unpopular warehouse projects, eliminates affordable housing requirements for family units, and subsidizes parking lots.
“New Jersey should have learned its lesson that loosening rules on corporate tax credits leads to bad development and wasted state dollars. Instead, the Legislature is poised to repeat mistakes of the past that led to years of audits and investigations.
“Major changes in tax credits worth hundreds of millions of dollars should undergo robust hearings and public comment so we can all assess what they would actually accomplish, what they would cost, and who would benefit.”
Changes in the bill include, but are not limited to:
- Providing tax credits for unpopular warehouse projects, which seem to have no shortage of funding without state assistance
- Eliminating affordable housing requirements for family units (3-bedrooms), a major shortage in most rental markets
- Subsidizing parking lots over actual commercial space and economic development
- Creating a loan program for developers backed by tax credits, all approved by the same agency
- Increasing the monetary value of tax credits through various financial changes, including:
- Allowing recipients to carry forward their credits to future tax years
- Allowing for transfer of credits
- Making the credits tax-free for corporate and income tax
- Weakening requirements for community benefit agreements
- Limiting fees that NJEDA can charge for program administration.
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