Bill Text: NJ A2086 | 2016-2017 | Regular Session | Introduced
Bill Title: Allows firms, designated as qualified UEZ businesses, that experience economic hardship to lower employment levels without losing that designation.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2016-01-27 - Introduced, Referred to Assembly Commerce and Economic Development Committee [A2086 Detail]
Download: New_Jersey-2016-A2086-Introduced.html
STATE OF NEW JERSEY
217th LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2016 SESSION
Sponsored by:
Assemblyman RAJ MUKHERJI
District 33 (Hudson)
Co-Sponsored by:
Assemblyman Caputo
SYNOPSIS
Allows firms, designated as qualified UEZ businesses, that experience economic hardship to lower employment levels without losing that designation.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act concerning qualified businesses in urban enterprise zones and amending P.L.1983, c.303.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 27 of P.L.1983, c.303 (C.52:27H-86) is amended to read as follows:
27. To be eligible for any of the incentives provided under [this act] P.L.1983, c.303 (C.52:27H-60 et seq.), a qualified business must demonstrate to the satisfaction of the authority that:
a. The business will create new employment in the municipality; and
b. The business will not create unemployment in other [areas of] municipalities within the State [, including the municipality in which the zone or UEZ-impacted business district is located].
c. For the purposes of eligibility for the incentives provided under sections 17, 19, 20, and 21 of P.L.1983, c.303 (C.52:27H-76, 52:27H-78, 52:27H-79, and 52:27H-80, respectively), a qualified business shall not be required to meet the requirements of subsection a. of this section, if:
(1) At the time of designation of the enterprise zone or at the time zone designation is extended by expansion to the location of a business or at the time of designation of the UEZ-impacted business district, the qualified business had been engaged in the active conduct of a trade or business in that zone or in the added area of that zone or in that district for at least one year prior to that designation or expansion;
(2) The qualified business employs fewer than 50 employees; and
(3) The qualified business has entered into an agreement, approved by the authority, with the governing body of the qualifying municipality in which the enterprise zone is located or the municipality where the UEZ-impacted business district is located, under which the qualified business agrees to undertake an investment in the enterprise zone or district in lieu of the employment of new employees. An investment permitted under an agreement shall be in an amount and of a nature which the municipal governing body and the authority find shall contribute substantially to the economic attractiveness of the enterprise zone or district, and may include, but shall not be limited to:
(a) The improvement of the exterior appearance or customer facilities of the property constituting the place of business of the qualified business within the zone or district; provided that the improvement is of a permanent nature and not required to meet existing ordinances or code regulations; or
(b) Monetary contributions to the municipality to undertake improvements to increase the safety or attractiveness of the zone or district to businesses which may wish to locate there or to consumer visitors to the zone or district, including, but not limited to litter clean-up and control, landscaping, parking areas and facilities, recreational and rest areas and facilities, repair or improvements to public streets, curbing, sidewalks and pedestrian thoroughfares, street lighting, or increased police, fire or sanitation services in the enterprise zone or UEZ-impacted business district.
In order to meet the requirements of paragraph (3) of this subsection, an investment shall be in an amount no less than $5,000.00 if the qualified business employs 10 or fewer employees, or if the qualified business employs more than 10 employees, not less than the amount produced by multiplying the number of employees employed by the qualified business by $500.00. A qualified business shall be required to make an investment for each year the qualified business does not meet the requirements of subsection a. of this section. In order to receive the incentives permitted by this section, the business shall provide written evidence of the investment to the authority.
d. Notwithstanding the requirement under subsection a. of this section that, to be eligible for incentives under P.L.1983, c.303, a business must demonstrate that it will create new employment, a qualified business may, without losing its eligibility for those incentives, lower its own overall level of employment if the business demonstrates to the authority that it is experiencing substantial economic hardship resulting from a sudden decrease in operating revenues or a sudden increase in operating expenses as evidenced by the business's most recent audited financial statements (including a balance sheet, a statement of income or loss, and a statement of changes in financial position) prepared by a certified public accountant or public accountant in good standing and, if available, the business's audited financial statements for the immediately preceding three-year period, a copy of which statements shall have been submitted to the authority.
(cf: P.L.2001, c.347, s.10)
2. This act shall take effect immediately.
STATEMENT
This bill would allow a qualified business, after first receiving designation by the New Jersey Urban Enterprise Zone Authority ("authority") as a "qualified business," as defined in section 3 of P.L.1983, c.303 (C.52:27H-62), to lower its own overall level of employment without losing that designation if the business provides evidence to the authority that it is experiencing economic hardship. A business that loses such designation no longer receives the benefits of the urban enterprise zone program, including the ability to charge a reduced sales and use tax on eligible goods and services sold by the business. Current law requires a business to hire new employees or, in certain circumstances, maintain its existing number of employees, after receiving designation or re-designation as a qualified business. Current law does not take into account periods of economic decline that may negatively affect the operations of the qualified business severely enough to require a reduction in employment levels.
