Governor Signs Economic Stimulus Act

On July 27, 2009 NJBA added another win to our score sheet with the signing of the Economic Stimulus Act of 2009 (P.L.2009, c. 90).  The law is yet another initiative intended to spur economic development, and, at NJBA's request, includes provisions to encourage residential development in urban areas.

The law is very complex and is the compilation of nearly half a dozen separate economic stimulus proposals, many of which were substantially amended in the legislative process.  NJBA is in the process of studying its nuances and will be issuing materials in the future to assist members in applying its provisions and capitalizing on the incentives it makes available.     

Chief among the law's provisions is an overhaul of the Urban Transit Hub Tax Credit program which will allow mixed-use projects, consisting predominantly of residential units, to receive tax credits.  Under the revamped program, companies will be eligible for a 100-percent corporate business tax credit for mixed-use projects investing at least $50 million and creating or relocating at least 250 jobs within a half-mile of mass transit stations in Trenton, Newark, New Brunswick, Paterson, Elizabeth, Hoboken, Jersey City and East Orange. In Camden, that radius is one mile.

The law also creates a Economic Redevelopment and Growth Grant program (ERGG) to provide developers with better resources to fill financing gaps in redevelopment projects.  ERGG will give municipalities the ability to finance redevelopment efforts through revenues derived from a site's redevelopment rather than through local borrowing.  Under ERGG, a developer is required to contribute his or her own capital for at least 20 percent of the project total cost.   

Lastly, the law exempts projects that received site plan approval before July 1, 2010 from non-residential development fees – as long as a construction permit is issued prior to January 1, 2013.  Municipalities are required to refund any fees which have already been paid for projects which meet these requirements.

(A copy of the law as signed by the Governor is available here.)

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