Bill Text: NJ S1834 | 2026-2027 | Regular Session | Amended
Bill Title: Authorizes creation of additional urban enterprise zones.
Sponsorship: Partisan Bill (Democrat 2)
Status: (Introduced) 2026-06-04 - Reported from Senate Committee with Amendments, 2nd Reading [S1834 Detail]
Download: New_Jersey-2026-S1834-Amended.html
Sponsored by:
Senator TROY SINGLETON
District 7 (Burlington)
Senator BENJIE E. WIMBERLY
District 35 (Bergen and Passaic)
SYNOPSIS
Authorizes creation of additional urban enterprise zones.
CURRENT VERSION OF TEXT
As reported by the Senate Budget and Appropriations Committee on June 4, 2026, with amendments.
An Act concerning the designation of urban enterprise zones and amending P.L.1983, c.303 and P.L.1995, c.382.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 3 of P.L.1983, c.303 (C.52:27H-62) is amended to read as follows:
3. As used in P.L.1983, c.303 (C.52:27H-60 et seq.):
a. "Enterprise zone" or "zone" means an urban enterprise zone designated by the authority pursuant to P.L.1983, c.303 (C.52:27H-60 et seq.);
b. "Authority" or "UEZ Authority" means the New Jersey Urban Enterprise Zone Authority created by P.L.1983, c.303 (C.52:27H-60 et seq.);
c. "Qualified business" means any entity authorized to do business in the State of New Jersey which, at the time of designation as an enterprise zone or a UEZ-impacted business district, is engaged in the active conduct of a trade or business in that zone or district; or an entity which, after that designation but during the designation period, becomes newly engaged in the active conduct of a trade or business in that zone or district and has at least 25 percent of its full-time employees employed at a business location in an eligible block group as defined under section 12 of P.L.2021, c.197 (C.52:27H-99), and which employees meet one or more of the following criteria:
(1) Residents within the zone, the district, within another zone or within a qualifying municipality; or
(2) Unemployed for at least six months prior to being hired and residing in New Jersey, and recipients of New Jersey public assistance programs for at least six months prior to being hired, or either of the aforesaid; or
(3) Determined to be low income individuals pursuant to the Workforce Investment Act of 1998, Pub.L.105-220 [(29 U.S.C. s.2811)] (29 U.S.C. s.2801);
Approval as a qualified business shall be conditional upon meeting all outstanding tax obligations, and may be withdrawn by the authority if a business is continually delinquent in meeting its tax obligations;
d. "Qualifying municipality" means any municipality that was previously designated as a qualifying municipality prior to the effective date of [P] P.L.2021, c.197. In addition to those municipalities that qualify pursuant to the criteria set forth above, the following municipalities shall also be deemed to be qualifying municipalities: (1) the municipalities accorded designation pursuant to section 7 of P.L.1983, c.303 (C.52:27H-66); (2) the municipalities set forth in section 3 of P.L.1995, c.382 (C.52:27H-66.1); 1[and]1 (3) the municipalities in which the three additional enterprise zones, including the joint enterprise zone, are to be designated pursuant to criteria according priority consideration for designation of the zones pursuant to section 12 of P.L.2001, c.347 (C.52:27H-66.7) 1; and (4) the municipalities in which the two additional enterprise zones are designated pursuant to paragraphs (10) and (11) of section 3 of P.L.1995, c.382 (C.52:27H-66.1)1;
e. "Public assistance" means income maintenance funds administered by the Department of Human Services or by a county welfare agency;
f. "Zone development corporation" means a nonprofit corporation or association created or designated by the governing body of a qualifying municipality to formulate and propose a preliminary zone development plan pursuant to section 9 of P.L.1983, c.303 (C.52:27H-68) and to prepare, monitor, administer and implement the zone development plan;
g. "Zone development plan" means a plan adopted by the governing body of a qualifying municipality for the development of an enterprise zone therein, and for the direction and coordination of activities of the municipality, zone businesses and community organizations within the enterprise zone toward the economic betterment of the residents of the zone and the municipality;
h. "Zone neighborhood association" means a corporation or association of persons who either are residents of, or have their principal place of employment in, a municipality in which an enterprise zone has been designated pursuant to P.L.1983, c.303 (C.52:27H-60 et seq.); which is organized under the provisions of Title 15 of the Revised Statutes or Title 15A of the New Jersey Statutes; and which has for its principal purpose the encouragement and support of community activities within, or on behalf of, the zone so as to (1) stimulate economic activity, (2) increase or preserve residential amenities, or (3) otherwise encourage community cooperation in achieving the goals of the zone development plan;
i. "Enterprise zone assistance fund" or "assistance fund" means the fund created by section 29 of P.L.1983, c.303 (C.52:27H-88);
j. "UEZ-impacted business district" or "district" means an economically-distressed business district classified by the authority as having been negatively impacted by two or more adjacent urban enterprise zones in which 50 percent less sales tax is collected pursuant to section 21 of P.L.1983, c.303 (C.52:27H-80);
k. "Block group" means statistical divisions of census tracts, that are generally defined by the United States Census Bureau to contain between 600 and 3,000 people and are used to present data and control block numbering;
l. "Municipal Revitalization Index" means the index developed, maintained, and updated from time to time, by the Department of Community Affairs ranking New Jersey's municipalities according to separate indicators that measure diverse aspects of social, economic, physical, and fiscal conditions in each locality;
m. "Qualified assistance fund expense" means any reasonable expense related to:
(1) a construction project improving, altering, or repairing the real property of a qualified business located in an enterprise zone;
(2) full or part time economic and community development positions in the municipality, other governmental, or not-for-profit organization, or marketing;
(3) loans, grants, and guarantees to businesses;
(4) payroll expenses, personnel, services, and equipment purchases primarily for the provision of law enforcement, fire protection, or emergency medical services within commercial and transportation corridors located exclusively in an enterprise zone;
(5) planning and other professional services related to economic and community development;
(6) cleaning and maintenance of commercial and transportation corridors;
(7) the improvement of public infrastructure in a commercial or transportation corridor and transportation infrastructure located within an enterprise zone, including, but not limited to, the payment of debt service related to the financing of a transportation infrastructure project, and the pledge of funds credited to the assistance fund toward the repayment of any loan issued by the State Transportation Infrastructure Bank pursuant to section 34 of P.L.2016, c.56 (C.58:11B-10.4) or any government agency, for a transportation infrastructure project, provided that up to 75 percent of any zone assistance funds may be used to pay debt service related to the financing of the cost of a transportation infrastructure project or pledged toward the repayment of any loan for the cost of a transportation infrastructure project if such use is detailed in that municipality's zone development plan certified by the UEZ Authority;
(8) the improvement of public infrastructure related to a commercial, industrial, mixed use, or multi-family residential property;
(9) employment and training programs; or
(10) events meant to support and draw activity into the enterprise zone, including fairs, festivals, and concerts.
n. "UEZ coordinator" means an individual designated by a qualified municipality or zone development corporation as the individual in charge of the activities related to the Urban Enterprise Zone program in that municipality;
o. "UZ-2 certification" means the UEZ Authority's certification of a qualified business, pursuant to section 21 of P.L.1983, c.303 (C.52:27H-80), allowing the qualified business an exemption to the extent of 50 percent of the tax imposed under the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.), when the sales transaction physically occurs within an enterprise zone. The qualified business may deliver merchandise to the purchaser at a location outside an enterprise zone provided the sales transaction was physically made within the enterprise zone. The regular tax rate shall be charged for mail order, telephone, internet, and similar sales transactions delivered within the State;
p. "UZ-4 certification" means the UEZ Authority's certification of a qualified business, pursuant to section 8 of P.L.2021, c.197 (C.52:27H-79.1), allowing a contractor of the qualified business to make tax-free purchases of materials, supplies, and services for the exclusive use of erecting a structure or building on, or substantially improving, altering, or repairing, the real property of a qualified business located in an enterprise zone at the address indicated on the qualified business's application for certification to the UEZ Authority;
q. "UZ-5 certification" means the UEZ Authority's certification of a qualified business, as defined under section 20 of P.L.1983, c.303 (C.52:27H-79), allowing the qualified business to make tax-free purchases of office and business equipment and supplies, furnishings, trade fixtures, repair, or construction materials and all other tangible personal property (other than motor vehicles and motor vehicle parts and supplies) for the exclusive use or consumption on the premises of the qualified business within an enterprise zone at an address indicated on the qualified business's application for certification to the UEZ Authority. The exemption may be used only for personal property controlled by the qualified business. This exemption shall also apply to delivery charges and charges for services performed for a qualified business at its zone location, including repair, janitorial, and maintenance services;
r. "Economic Distress Index" means a standardized score developed and maintained by the Department of Community Affairs that equally incorporates the block group unemployment rate and median household income according to the most recent five-year estimate by the United States Census Bureau;
s. "Commercial corridor" means the land area with frontage on a State, county, local, or rail thoroughfare in an enterprise zone which is predominantly commercial or industrial;
t. "Transportation corridor" means a broad geographical band that follows a general directional flow or connects major sources of trips. It may contain a number of streets and highways and transit lines or routes;
u. "Improvement of transportation infrastructure" means the undertaking of a capital project for the construction, repair, upgrade, or maintenance of transportation infrastructure;
v. "Transportation infrastructure" includes, but is not limited to:
(1) all public highways, roads, bridges, and streets in the State, whether maintained by the State or by any county, municipality, or other political subdivision; and
(2) public transportation facilities used in connection with public transportation service, such as passenger stations, shelters, and terminals, automobile and bus parking facilities, ramps, track connections, signal systems, power systems, information and communication systems, roadbeds, transit lanes or rights-of-way, equipment storage and servicing facilities, bridges, grade crossings, rail cars, locomotives, motorbuses and other motor vehicles, maintenance and garage facilities, revenue handling equipment, and any other equipment, facility, or property useful or related to the provision of public transportation service;
w. "Public transportation service" means rail passenger service, motorbus regular route service, paratransit service, motorbus charter service, and ferry passenger service;
x. "Rail passenger service" means and includes the operations of a railroad, subway, street, traction, or electric railway for the purpose of carrying passengers in this State or between points in this State and points in other states;
y. "Motorbus regular route service" means and includes the operation of any motorbus or motorbuses on streets, public highways, or other facilities over a fixed route and between fixed termini on a regular schedule for the purpose of carrying passengers for hire or otherwise in this State or between points in this State and points in other states;
z. "Paratransit services" means and includes any service, other than motorbus regular route service and charter services, including, but not limited to, dial-a-ride, non-regular route, jitney or community minibus, and shared-ride services such as vanpools, limousines, or taxicabs which are regularly available to the public. Paratransit services shall not include limousine or taxicab service reserved for the private and exclusive use of individual passengers;
aa. "Motorbus charter service" means and includes subscription, tour, other special motorbus services, school bus services, or charter services as set forth in section 7 of P.L.1979, c.150 (C.27:25-7); and
bb. "Ferry passenger service" means any service which involves the carriage of persons for compensation or hire by waterborne craft in this State or between points in this State and points in other states.
(cf: P.L.2024, c.80, s.1)
2. Section 7 of P.L.1983, c.303 (C.52:27H-66) is amended to read as follows:
7. The authority shall designate enterprise zones from among those areas of qualifying municipalities determined to be eligible pursuant to P.L.1983, c.303 (C.52:27H-60 et seq.). No more than [32] 1[33] 341 enterprise zones shall be in effect at any one time. No more than one enterprise zone shall be designated in any one municipality. In designating enterprise zones, the authority shall seek to avoid excessive geographic concentration of zones in any particular region of the State. At least six of the 10 additional enterprise zones authorized pursuant to section 3 of P.L.1993, c.367 shall be located in counties in which enterprise zones have not previously been designated and shall be designated within 90 days of the date of the submittal of an application and zone development plan. The authority shall accept applications within 90 days of the effective date of P.L.1993, c.367. Notwithstanding the provisions of P.L.1983, c.303 (C.52:27H-60 et seq.) to the contrary, the six additional enterprise zones to be designated by the authority pursuant to the criteria for priority consideration in this section shall be entitled to an exemption to the extent of 50 percent of the tax imposed under the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.). The following criteria shall be utilized in according priority consideration for designation of these zones by the authority:
a. One zone shall be located in a county of the second class with a population greater than 595,000 and less than 675,000 according to the latest federal decennial census and shall be located in the qualifying municipality in that county with the highest annual average number of unemployed persons and the highest average annual unemployment rate for the 1992 calendar year according to the estimate by the State Department of Labor and Workforce Development;
b. Two zones shall be located in a county of the second class with a population greater than 445,000 and less than 455,000 according to the latest federal decennial census, one of which shall be located in the qualifying municipality in that county with the highest annual average number of unemployed persons and the highest average annual unemployment rate for the 1992 calendar year according to the estimate by the State Department of Labor and Workforce Development, and one of which shall be located in the qualifying municipality in that county with the second highest annual average number of unemployed persons and the second highest average annual unemployment rate for the 1992 calendar year according to the estimate by the State Department of Labor and Workforce Development;
c. One zone shall be located in a county of the third class with a population greater than 84,000 and less than 92,000 according to the latest federal decennial census and shall be located in the qualifying municipality in that county with the highest annual average number of unemployed persons and the highest average annual unemployment rate for the 1992 calendar year according to the estimate by the State Department of Labor and Workforce Development;
d. One zone shall be located within two noncontiguous qualifying municipalities but comprised of not more than two noncontiguous areas each having a continuous border, if:
(1) both municipalities are located in the same county which shall be a county of the fifth class with a population greater than 500,000 and less than 555,000 according to the latest federal decennial census;
(2) the two municipalities submit a joint application and zone development plan; and
(3) each of the municipalities has a population greater than 16,000 and less than 30,000 and a population density of more than 5,000 persons per square mile, according to the latest federal decennial census; and
e. One zone shall be located within a municipality having a population greater than 38,000 and less than 46,000 according to the latest federal decennial census if the municipality is located within a county of the fifth class with a population greater than 340,000 and less than 440,000 according to the latest federal decennial census.
(cf: P.L.2018, c.19, s.1)
3. Section 3 of P.L.1995, c.382 (C.52:27H-66.1) is amended to read as follows:
3. The additional seven zones authorized pursuant to P.L.1995, c.382 (C.52:27H-66.1 et al.), the additional zone authorized pursuant to P.L.2003, c.285, [and] the additional zone designated pursuant to P.L.2004, c.75, and the additional 1[zone] zones1 designated pursuant to P.L. , c. (pending before the Legislature as this bill) shall be designated within 90 days of the date of the submittal of an application and zone development plan. The authority shall accept applications within 90 days of the effective date of P.L.1995, c.382 (C.52:27H-66.1 et al.) [or], P.L.2003, c.285, or P.L. , c. (pending before the Legislature as this bill), as applicable, for those zones that fulfill the criteria set forth in this section. Notwithstanding the provisions of P.L.1983, c.303 (C.52:27H-60 et seq.) to the contrary, the [nine] 1[10] 111 additional enterprise zones to be designated by the authority pursuant to the criteria for priority consideration set forth in this section shall be entitled to an exemption to the extent of [50%] 50 percent of the tax imposed under the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.). The following criteria shall be utilized in according priority consideration for designation of the seven additional enterprise zones authorized pursuant to P.L.1995, c.382 (C.52:27H-66.1 et al.), the additional enterprise zone authorized pursuant to P.L.2003, c.285, [and] the additional zone designated pursuant to P.L.2004, c.75, and the additional enterprise 1[zone] zones1 authorized pursuant to P.L. , c. (pending before the Legislature as this bill):
(1) One zone shall be located in a qualifying municipality with a population greater than 55,000 and less than 65,000 according to the latest federal decennial census in a county of the first class with a population density greater than 6,100 and less than 6,700 persons per square mile according to the latest federal decennial census provided that the qualifying municipality is contiguous to a municipality in which an enterprise zone is designated;
(2) One zone shall be located in a qualifying municipality with a population greater than 70,000 and less than 80,000 according to the latest federal decennial census;
(3) One zone shall be located in a qualifying municipality with a population greater than 38,000 and less than 39,500 according to the latest federal decennial census;
(4) One zone shall be located in a qualifying municipality with a population greater than 45,000 and less than 55,000 according to the latest federal decennial census;
(5) One zone shall be located in a qualifying municipality with a population greater than 21,000 and less than 22,000;
(6) One zone shall be located in a qualifying municipality with a population greater than 29,000 and less than 32,000 according to the latest federal decennial census;
(7) One zone shall be located within a qualifying municipality having a population greater than 7,000 and less than 9,000 according to the latest federal decennial census in a county of the first class with a population greater than 550,000 and less than 560,000 according to the latest federal decennial census;
(8) An additional zone shall be located within a qualifying municipality with a population greater than 11,400 and less than 11,600 according to the latest federal decennial census in a county of the second class with a population greater than 500,000 and less than 520,000 according to the latest federal decennial census; [and]
(9) An additional zone shall be located within a qualifying municipality with a population greater than 48,000 and less than 49,000 according to the latest federal decennial census in a county of the second class with a population of greater than 750,000 according to the latest federal decennial census; 1[and]1
(10) An additional zone shall be located within a qualifying municipality with a poverty rate of at least 12 percent, according to the 1[2023] 20261 Municipal Revitalization Index, and a population greater than 9,000 and less than 11,000 in the county of the second class with the lowest population density, with populations determined according to the latest federal decennial census 1; and
(11) An additional zone shall be located within a qualifying municipality with a poverty rate of at least 12 percent, according to the 2026 Municipal Revitalization Index, and a population greater than 45,000 and less than 47,000 in the county of the first class with the highest population, with populations determined according to the latest federal decennial census1.
(cf: P.L.2004, c.75, s.3)
14. Section 9 of P.L.1983, c.303 (C.52:27H-68) is amended to read as follows:
9. a. [Prior to the effective date of P.L.2021, c.197, the] The governing body of a qualifying municipality may apply for designation as an enterprise zone, [the municipal governing body] which shall cause a preliminary zone development plan to be formulated, either by a zone development corporation or by the governing body, with the assistance of those officers and agencies of the municipality as the governing body may see fit. For a municipality with a zone development plan that was approved more than five years prior to the effective date of P.L.2021, c.197, the governing body of the municipality shall submit an updated preliminary zone development plan pursuant to this section. In formulating an updated preliminary zone development plan pursuant to this section, a zone development corporation or the governing body of the municipality shall consult with representatives of diverse Statewide or regional business organizations that represent the interests of minority businesses, as defined in section 2 of P.L.1986, c. 195 (C.52:27H-21.18), which organizations shall have no less than 30 days to review a proposed preliminary zone development plan and submit comments to the zone development corporation or governing body. Each preliminary zone development plan shall set forth the boundaries of the enterprise zone and include findings of fact concerning the economic and social conditions existing in the enterprise zone, and the municipality's policy and intentions for addressing these conditions, and may include proposals respecting:
(1) Utilizing the powers conferred on the municipality by law for the purpose of stimulating investment in and economic development of the zone;
(2) Utilizing State assistance through the provisions of P.L.1983, c.303 (C.52:27H-60 et seq.) relating to State tax benefits and enterprise zone assistance funds;
(3) Securing the involvement in, and commitment to, zone economic development by private entities, including zone neighborhood associations, voluntary community organizations supported by residents and businesses in the zone;
(4) Utilizing the powers conferred by law to revise municipal planning and zoning ordinances and other land use regulations as they pertain to the zone, in order to enhance the attraction of the zone to prospective developers;
(5) Increasing the availability and efficiency of support services, public and private, generally used by and necessary to the efficient functioning of commercial and industrial facilities in the area, and the extent to which the increase or improvement is to be provided and financed by the municipal government or by other entities.
b. (1) The governing body of a municipality may request from the UEZ Authority an amount not to exceed 10 percent of the municipality's zone assistance fund allocation or $125,000, whichever is greater, to fund, in whole or in part, the costs associated with formulating a preliminary zone development plan, which amount the governing body may use to pay employees, or to retain a consultant, to formulate the plan. Prior to soliciting a consultant to formulate the plan with these funds, the governing body of a municipality shall submit to the UEZ Authority the proposed solicitation.
(2) The UEZ Authority shall review the proposed solicitation and may provide recommended modifications to the proposed solicitation. The governing body of a municipality or a zone development corporation may incur expenses related to the preparation of the preliminary zone development plan for potential reimbursement at a later time by the UEZ Authority from the municipality zone assistance fund account, provided the authority determines the expenses are reasonable. The governing body of a municipality or a zone development corporation shall complete a preliminary zone development plan with assistance from the UEZ Authority, as needed, in accordance with a timeline established by the authority pursuant to rules, regulations, or guidelines adopted by the authority.
(3) Within 14 days of receipt, unless the authority finds material deficiencies in a preliminary zone development plan, the authority shall approve and certify the preliminary zone development plan as the zone development plan. The zone development plan shall be the plan according to which the Urban Enterprise Zone program shall be administered in that zone, and certification of the plan shall enable the municipality to access assistance from the enterprise zone assistance fund described in section 10 of P.L.2021, c.197 (C.52:27H-88). Should the authority find deficiencies with a preliminary zone development plan, it shall provide a corrective action plan to the municipality.
c. If no zone development plan is in place, upon petition of the zone development corporation or governing body of the municipality, the UEZ Authority may grant a distribution from that municipality's zone assistance fund account for an eligible project that responds to an impact of a public health emergency or state of emergency declared by the Governor. A zone development corporation or governing body of a municipality without a zone development plan in place, which can demonstrate to the UEZ Authority an actionable and feasible plan to carry out a project eligible for zone assistance funds, and which can demonstrate a reliance on zone assistance funding, may petition the authority for a distribution from that municipality's zone assistance fund account prior to the authority's approval of an updated preliminary zone development plan.
d. No zone development plan shall remain in force once it has been certified by the UEZ Authority for more than five years. The governing body of a municipality or zone development corporation shall follow the process enumerated in subsections a. and b. of this section to ensure a zone development plan remains current to protect against lapse of enterprise zone designation.
e. Notwithstanding the provisions of this section to the contrary, a qualified business in an enterprise zone having such qualified status immediately preceding the effective date of P.L.2021, c.197, and which is qualified under P.L.2021, c.197, shall remain eligible for the exemptions from the tax imposed under the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.), pursuant to sections 20 and 21 of P.L.1983, c.303 (C.52:27H-79 and C.52:27H-80), and shall be eligible for the exemption under section 8 of P.L.2021, c.197 (C.52:27H-79.1) even if the municipality in which the business is located fails to submit a zone development plan in accordance with this section; provided, however, a municipality failing to submit a zone development plan under this section shall not be eligible for loans, grants, and other assistance from the UEZ Authority, and shall not be allowed a distribution from that municipality's zone assistance fund, except as provided for in subsection c. of this section, until a revised zone development plan is submitted and approved by the UEZ Authority.1
(cf: P.L.2021, c.197, s.4)
15. Section 13 of P.L.1983, c.303 (C.52:27H-72) is amended to read as follows:
13. a. In designating eligible areas as enterprise zones, the authority shall approve zone development plans which:
(1) Have potential for success in stimulating primarily new economic activity in the area;
(2) Are designed to address urban distress, as measured by existing levels of unemployment, poverty, and property tax arrearages;
(3) Demonstrate substantial and reliable commitments of resources by zone businesses, zone neighborhood associations, voluntary community organizations and other private entities to the economic success of the zone; and
(4) Demonstrate substantial effort and commitment by the municipality to encourage economic activity in the area and to remove disincentives for job creation compatible with the fiscal condition of the municipality.
b. In addition to the considerations set forth in subsection a. of this section, the authority in evaluating a zone development plan for designation purposes shall consider:
(1) The likelihood of attracting federal assistance to projects in the eligible area, and of obtaining federal designation of the area as an enterprise zone for federal tax purposes;
(2) The adverse or beneficial effects of an enterprise zone located at the proposed area upon economic development activities or projects of State or other public agencies which are in operation, or are approved for operation, in the qualifying municipality;
(3) The degree of commitment made by public and private entities to utilize minority contractors and assure equal opportunities for employment in connection with any construction or reconstruction to be undertaken in the eligible area;
(4) The impact of the zone development plan upon the social, natural and historic environment of the eligible area; 1and1
(5) The degree to which the implementation of the plan involves the relocation of residents from the eligible area, and the adequacy of commitments and provisions with respect thereto.
c. A designated zone that is operative on the effective date of P.L.2021, c.197 shall remain a designated zone until the end of the 10th State fiscal year next following the effective date of P.L.2021, c.197. The authority shall not designate new enterprise zones following the effective date of P.L.2021, c.197.
d. Notwithstanding the provisions of subsection c. of this section, the authority shall evaluate and, as appropriate, approve zone development plans for enterprise zones designated pursuant to paragraphs (10) and (11) of section 3 of P.L.1995, c.382 (C.52:27H-66.1). A zone designated pursuant to paragraph (10) or (11) of section 3 of P.L.1995, c.382 (C.52:27H-66.1) shall remain a designated zone until the end of the 10th State fiscal year next following the zone's designation.1
(cf: P.L.2021, c.197, s.6)
16. Section 29 of P.L.1983, c.303 (C.52:27H-88) is amended to read as follows:
29. a. (1) There is created an enterprise zone assistance fund to be held by the State Treasurer, which shall be the repository for all moneys required to be deposited therein under section 21 of P.L.1983, c.303 (C.52:27H-80), as amended by this act, P.L.2023, c.282, and moneys appropriated annually to the fund. All moneys in the fund shall be held and disbursed in accordance with this section and section 11 of P.L.2021, c.197 (C.52:27H-98) as necessary to fulfill the purposes of this section and subject to the requirements hereinafter prescribed. The State Treasurer may invest and reinvest any moneys in the fund, or any portion thereof, to strengthen capital structures, leverage additional debt capital, and increase lending and investing in economically disadvantaged communities, and in any other manner that advances the goals of the Urban Enterprise Zone program, including, but not limited to, legal obligations of the United States or of the State or of any political subdivision thereof or government-sponsored enterprises. Any income from, interest on, or increment to moneys so invested or reinvested shall be included in the fund.
The amount in the enterprise zone assistance fund, which shall be available to fulfill the purposes of this section, shall be as follows:
(a) In the first five State fiscal years next following the effective date of P.L.2021, c.197, 100 percent of the amount determined pursuant to section 11 of P.L.2021, c.197 (C.52:27H-98) shall be available to fulfill the purposes of this section;
(b) In the sixth State fiscal year next following the effective date of P.L.2021, c.197, 95 percent of the amount determined pursuant to section 11 of P.L.2021, c.197 (C.52:27H-98) shall be available to fulfill the purposes of this section and five percent of such amount shall be deposited in the General Fund;
(c) In the seventh State fiscal year next following the effective date of P.L.2021, c.197, 90 percent of the amount determined pursuant to section 11 of P.L.2021, c.197 (C.52:27H-98) shall be available to fulfill the purposes of this section and 10 percent of such amount shall be deposited in the General Fund;
(d) In the eighth State fiscal year next following the effective date of P.L.2021, c.197, 85 percent of the amount determined pursuant to section 11 of P.L.2021, c.197 (C.52:27H-98) shall be available to fulfill the purposes of this section and 15 percent of such amount shall be deposited in the General Fund;
(e) In the ninth State fiscal year next following the effective date of P.L.2021, c.197, 80 percent of the amount determined pursuant to section 11 of P.L.2021, c.197 (C.52:27H-98) shall be available to fulfill the purposes of this section and 20 percent of such amount shall be deposited in the General Fund; and
(f) In the 10th State fiscal year next following the effective date of P.L.2021, c.197, and each State fiscal year thereafter in which an enterprise zone remains designated pursuant to subsection d. of section 13 of P.L.1983, c.303 (C.52:27H-72), 75 percent of the amount determined pursuant to section 11 of P.L.2021, c.197 (C.52:27H-98) shall be available to fulfill the purposes of this section and 25 percent of such amount shall be deposited in the General Fund.
(2) The State Treasurer shall maintain separate accounts for each enterprise zone designated under P.L.1983, c.303 (C.52:27H-60 et seq.) that is in good standing with the UEZ Authority in accordance with rules adopted by the UEZ Authority, and one in the authority's name for the administration of the Urban Enterprise Zone program, and for providing grants, including planning grants, investments, loans, or other guaranties related to qualified assistance fund expenses. The State Treasurer shall credit to each account an amount of the moneys deposited in the fund and available to fulfill the purposes of this section, which amount shall be determined by a weighted formula that applies 50 percent weight to a zone municipality's number of commercial and industrial parcels as recorded by the municipal tax assessor, its Municipal Revitalization Index Distress Score, as determined by the Department of Community Affairs, and the average number of unemployed persons in the municipality according to data provided by the New Jersey Department of Labor and Workforce Development, and 50 percent weight to the gross taxable sales in the municipality subject to reduced sales tax pursuant to section 21 of P.L.1983, c.303 (C.52:27H-80), as determined by the State Treasurer. The data used in the formula, developed under this section, shall be the most recent data that has been made available by the Department of Community Affairs, the Department of Labor and Workforce Development, and the State Treasurer. When funds are received by a qualifying municipality pursuant to this subsection, the funds shall be placed in a new trust or, for a qualifying municipality that has a trust for an enterprise zone on the effective date of P.L.2021, c.197, in the existing trust. The Division of Local Government Services in the Department of Community Affairs shall promulgate regulations, policies, or procedures as necessary to implement the provisions of this section.
(3) Beginning in State Fiscal Year 2022, $2,500,000 shall be appropriated annually from the account in the authority's name for the administration of the Urban Enterprise Zone program, and for providing grants, investments, loans, or other guaranties related to qualified assistance fund expenses. This amount shall be adjusted annually by the percentage change in the 12-month Consumer Price Index from June 30 to July 1.
(4) The State Treasurer shall promulgate the rules and regulations necessary to govern the administration of the fund for the purposes of this section, which shall include, but not be limited to, regulations requiring the establishment of separate bank accounts for funds credited to the enterprise zone account of each municipality from the enterprise zone assistance fund, commonly known as "first generation funds," and funds generated from the repayments of loans to individuals and businesses from the enterprise zone account of each municipality and the proceeds from the sale of properties and equipment acquired through the enterprise zone program, commonly known as "second generation funds," and the review, compilation, and monitoring of second generation fund quarterly reports submitted by each enterprise zone.
Any individual, including an individual who is not directly employed by a municipality, with the authority to administer, allocate or approve the use of zone assistance funds is subject to the "Local Government Ethics Law," P.L.1991, c.29 (C.40A:9-22.1 et seq.), unless the individual is a State employee or a special State officer.
b. The enterprise zone assistance fund shall be used for the purpose of assisting qualifying municipalities in which enterprise zones are designated in undertaking economic development projects in designated enterprise zones by funding qualified assistance fund expenses. However, a municipality shall not appropriate or expend: more than 25 percent of the amount annually credited to its enterprise zone assistance fund for public safety purposes, as described in paragraph (4) of subsection m. of section 3 of P.L.1983, c.303 (C.52:27H-62); or more than 10 percent of the amount annually credited to its enterprise zone assistance fund for administrative expenses.
c. The governing body of a qualifying municipality in which an enterprise zone is designated and the zone development corporation created or designated by the municipality for that enterprise zone may, by resolution jointly adopted after public hearing, propose to undertake an economic development project in the enterprise zone, and to fund that project from moneys deposited in the enterprise zone assistance fund and credited to the account maintained by the State Treasurer for the enterprise zone.
The proposal so adopted shall set forth a plan for the project and shall include:
(1) A description of the proposed project;
(2) An estimate of the total project costs, and an estimate of the amounts of funding necessary annually from the enterprise zone account;
(3) A statement of any other revenue sources to be used to finance the project;
(4) A statement of the time necessary to complete the project;
(5) A statement of the manner in which the proposed project furthers the municipality's policy and intentions for addressing economic development in the enterprise zone as set forth in the zone development plan approved by the authority; and
(6) A description of the financial and programmatic controls and reporting mechanisms to be used to guarantee that the funds will be spent in accordance with the plan and that the project will accomplish its purpose.
As used in this section, "project" means an activity that satisfies the requirements of a qualified assistance fund expense, as that term is defined in subsection m. of section 3 of P.L.1983, c.303 (C.52:27H-62), and which will lead to the creation of new jobs and increased economic activity within the zone.
d. (Deleted by amendment, P.L.2021, c.197)
e. (Deleted by amendment, P.L.2021, c.197)
f. (Deleted by amendment, P.L.2021, c.197)
g. (Deleted by amendment, P.L.2021, c.197)
h. At the end of a State fiscal year, if a municipality has not encumbered a portion of its allocation, such amount may be carried forward to the next State fiscal year and the State fiscal year thereafter. If at the end of the third State fiscal year any of those unencumbered funds remain, then the funds shall be transferred to the UEZ Authority's account in the enterprise zone assistance fund.
i. At the end of a State fiscal year, if a municipality has not expended or otherwise committed a portion of its encumbered funds, then such amount may be carried forward to the next three succeeding State fiscal years. If at the end of the third State fiscal year any unexpended funds remain, then the funds shall be transferred to the UEZ Authority's account in the enterprise zone assistance fund.
j. At the end of a State fiscal year, the Department of Community Affairs shall review an enterprise zone's expenditures of funds received from the zone assistance fund. If the department finds that an enterprise zone expended such funds in a manner inconsistent with the provisions of P.L.1983, c.303 (C.52:27H-60 et seq.) and P.L.2021, c.197, then the enterprise zone shall repay such funds to the department through the forfeiture of future zone assistance fund disbursements. The department shall withhold future funding from the enterprise zone until the enterprise zone enters into and complies with a corrective action plan developed by the department.
k. If in a State fiscal year the amount allocated to the enterprise zone assistance fund is less than the amount required to be allocated to fulfill the purposes of this section pursuant to section 11 of P.L.2021, c.197 (C.52:27H-98) and paragraph (1) of subsection a. of this section, the Legislature shall appropriate to the enterprise zone assistance fund the amount that was not allocated in such State fiscal year in a succeeding State fiscal year along with the funds required to be allocated in that State fiscal year.1
(cf: P.L.2023, c.282, s.2)
1[4.] 7.1 This act shall take effect immediately.
