Bill Text: NJ S3479 | 2024-2025 | Regular Session | Introduced
Bill Title: Modifies certain provisions of Historic Property Reinvestment and Brownfields Redevelopment Incentive programs.
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Introduced) 2024-06-28 - Substituted by A4619 [S3479 Detail]
Download: New_Jersey-2024-S3479-Introduced.html
Sponsored by:
Senator M. TERESA RUIZ
District 29 (Essex and Hudson)
SYNOPSIS
Modifies certain provisions of Historic Property Reinvestment and Brownfields Redevelopment Incentive programs.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning the "Historic Property Reinvestment Act" and "Brownfields Redevelopment Incentive Program Act" and amending P.L.2020, c.156.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 3 of P.L.2020, c.156 (C.34:1B-271) is amended to read as follows:
3. As used in sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276):
"Authority" means the New Jersey Economic Development Authority established pursuant to section 4 of P.L.1974, c.80 (C.34:1B-4).
"Board" means the Board of the New Jersey Economic Development Authority, established pursuant to section 4 of P.L.1974, c.80 (C.34:1B-4).
"Building services" means any cleaning or routine building maintenance work, including, but not limited to, sweeping, vacuuming, floor cleaning, cleaning of rest rooms, collecting refuse or trash, window cleaning, securing, patrolling, or other work in connection with the care or securing of an existing building, including services typically provided by a door-attendant or concierge. "Building services" shall not include any skilled maintenance work, professional services, or other public work for which a contractor is required to pay the "prevailing wage" as defined in section 2 of P.L.1963, c.150 (C.34:11-56.26).
"Cost of rehabilitation" means the consideration given, valued in money, whether given in money or otherwise, for the materials and services which constitute the rehabilitation, and includes all costs associated with the structural components within a qualified property or transformative property and any soft costs associated with a rehabilitation project, except not including any costs associated with an increase in total building volume.
"Cost of facade rehabilitation" means the consideration given, valued in money, whether given in money or otherwise, for the materials and services which constitute the facade rehabilitation project, and including all costs associated with necessary work to address structural components embedded within exterior walls, repair, reconstruction, or replacement of masonry units and mortar, exterior siding fabric, doors, windows, exterior lighting fixtures, and decorative components, such as metalwork, terracotta units, and cast stone, except not including any costs associated with demolition or interior construction.
"Director" means the Director of the Division of Taxation in the Department of the Treasury.
"Exterior building features" include, but shall not be limited to, structural components embedded within exterior walls, masonry units and mortar, exterior siding fabric, doors, windows, exterior lighting fixtures, and decorative components, such as metalwork, terracotta units, and cast stone.
"Facade rehabilitation project" means a project consisting of the repair or reconstruction of exterior building features which constitute the facades of a qualified property or transformative property while preserving the portions or features of the property that have significant historical, architectural, and cultural values.
"Government-restricted municipality" means a municipality in this State with a municipal revitalization index distress score of at least 75, that met the criteria for designation as an urban aid municipality in the 2019 State fiscal year, and that, on the effective date of P.L.2020, c.156 (C.34:1B-269 et al.), is subject to financial restrictions imposed pursuant to the "Municipal Stabilization and Recovery Act," P.L.2016, c.4 (C.52:27BBBB-1 et seq.), or is restricted in its ability to levy property taxes on property in that municipality as a result of the State of New Jersey owning or controlling property representing at least 25 percent of the total land area of the municipality or as a result of the federal government of the United States owning or controlling at least 50 acres of the total land area of the municipality, which is dedicated as a national natural landmark.
"Income producing property" means a structure or site that is used in a trade or business or to produce rental income.
"New Jersey S corporation" means the same as the term is defined in section 12 of P.L.1993, c.173 (C.54A:5-10).
"Officer" means the State Historic Preservation Officer or the official within the State designated by the Governor or by statute in accordance with the provisions of chapter 3023 of Title 54, United States Code (54 U.S.C. s.302301 et seq.), to act as liaison for the purpose of administering historic preservation programs in the State.
"Partnership" means an entity classified as a partnership for federal income tax purposes.
"Project financing gap" means the part of the total cost of rehabilitation, including reasonable and appropriate return on investment, that remains to be financed after all other sources of capital have been accounted for, including, but not limited to, developer contributed capital, which shall not be less than 20 percent of the total cost of rehabilitation, and investor or financial entity capital or loans for which the developer, after making all good faith efforts to raise additional capital, certifies that additional capital cannot be raised from other sources; provided, however, that for a redevelopment project located in a government-restricted municipality, the developer contributed capital shall not be less than 10 percent of the cost of rehabilitation. Developer contributed capital may consist of cash, deferred development fees, costs for project feasibility incurred within the 12 months prior to application, property value less any mortgages when the developer owns the project site, and any other investment by the developer in the project deemed acceptable by the authority, as provided by regulations promulgated by the authority. Property value shall be valued at the lesser of either: a. the purchase price, provided the property was purchased pursuant to an arm's length transaction within 12 months of application; or b. the value as determined by a current appraisal.
["Property" means a structure, including its site improvements and landscape features, assessed as real property, and used for: a commercial purpose; a residential rental purpose, provided the structure contains at least four dwelling units; or any combination thereof.]
"Qualified incentive tract" means: a. a population census tract having a poverty rate of 20 percent or more; or b. a census tract in which the median family income for the census tract does not exceed 80 percent of the greater of the Statewide median family income or the median family income of the metropolitan statistical area in which the census tract is situated.
"Qualified property" means a property, including structures, site improvements, and landscape features, assessed as real property, that is used for a commercial purpose, a residential rental purpose, provided the structure contains at least four dwelling units, or any combination thereof; that is located in the State of New Jersey; that is [an] income producing [property,] ; and that is:
a. (1) individually listed, or located in a district listed on the National Register of Historic Places in accordance with the provisions of chapter 3021 of Title 54, United States Code (54 U.S.C. s.302101 et seq.), or on the New Jersey Register of Historic Places pursuant to P.L.1970, c.268 (C.13:1B-15.128 et seq.), or individually designated, or located in a district designated, by the Pinelands Commission as a historic resource of significance to the Pinelands in accordance with the Pinelands comprehensive management plan adopted pursuant to the "Pinelands Protection Act," P.L.1979, c.111 (C.13:18A-1 et seq.), and
(2) if located within a district, certified by either the officer or the Pinelands Commission, as appropriate, as contributing to the historic significance of the district; [or]
b. (1) individually identified or registered, or located in a district composed of properties identified or registered, for protection as significant historic resources in accordance with criteria established by a municipality in which the property or district is located if the criteria for identification or registration has been approved by the officer as suitable for substantially achieving the purpose of preserving and rehabilitating buildings of historic significance within the jurisdiction of the municipality, and
(2) if located within a district, certified by the officer as contributing to the historic significance of the district; or
c. (1) preliminarily determined by the National Park Service to be of historic significance in accordance with the requirements of 36 C.F.R. s.67.3 and 36 C.F.R. s.67.4; and
(2) within one year of the issuance of the tax credits, listed on the New Jersey Register of Historic Places in accordance with the "New Jersey Register of Historic Places Act," P.L.1970, c.268 (C.13:1B-15.128 et seq.) and the New Jersey Register of Historic Places rules, N.J.A.C.7:4-1 et seq., as adopted by the Department of Environmental Protection and administered through the Historic Preservation Office. Failure to be listed on the New Jersey Register of Historic Places within one year of issuance of the tax credit shall result in the recapture of the tax credit.
"Rehabilitation" means the repair or reconstruction of the exterior or interior, including, but not limited to, structural or substrate components and electrical, plumbing, and heating components, of a qualified property or transformative project to make an efficient contemporary use possible while preserving the portions or features of the property that have significant historical, architectural, and cultural values.
["Rehabilitation of the interior of the qualified property or transformative project" means the repair or reconstruction of the structural or substrate components and electrical, plumbing, and heating components within the interior of a qualified property or transformative project.]
"Selected rehabilitation period" means a period of [24] 36 months if the beginning of such period is chosen by the business entity during which, or parts of which, a rehabilitation is occurring, or a period of 60 months if a rehabilitation is reasonably expected to be completed in distinct phases set forth in written architectural plans and specifications completed before or during the physical work on the rehabilitation.
"Structural components" means the same as that term is defined in 26 C.F.R. s.1.48-1.
"Total cost of rehabilitation" means any costs incurred for, and in connection with, the rehabilitation project by the business entity and any affiliate of the business entity until the issuance of a permanent certificate of occupancy, or upon such other event evidencing project completion as set forth in the rehabilitation agreement, and includes, but is not limited to, project costs, soft costs, and cost of acquisition of land and buildings.
"Total cost of facade rehabilitation project" means any costs incurred for, and in connection with, the facade rehabilitation project by the business entity and any affiliate of the business entity until the issuance of a permanent certificate of occupancy, or upon such other event evidencing project completion as set forth in the rehabilitation agreement, and includes, but is not limited to, project costs, soft costs, and cost of acquisition of land and buildings.
"Transformative project" means a property that is:
a. an income producing property, not including a residential property, whose rehabilitation the authority determines will generate substantial increases in State revenues through the creation of increased business activity within the surrounding area;
b. individually listed on the New Jersey Register of Historic Places pursuant to P.L.1970, c.268 (C.13:1B-15.128 et seq.) and which, before the enactment of P.L.2020, c.156 (C.34:1B-269 et al.), received a Determination of Eligibility from the Keeper of the National Register of Historic Places in accordance with the provisions of Part 60 of Title 36 of the Code of Federal Regulations; and
c. (1) located within a one-half mile radius of the center point of a transit village, as designated by the New Jersey Department of Transportation, and located within a city of the first class, as classified under N.J.S.40A:6-4; or (2) located within a government-restricted municipality.
(cf: P.L.2021, c.160, s.1)
2. Section 4 of P.L.2020, c.156 (C.34:1B-272) is amended to read as follows:
4. a. (1) A business entity, upon successful application to the New Jersey Economic Development Authority, and commitment to the authority to pay each worker employed to perform construction work and building services work at the qualified property or transformative project a wage not less than the prevailing wage rate for the worker's craft or trade, as determined by the Commissioner of Labor and Workforce Development pursuant to P.L.1963, c.150 (C.34:11-56.25 et seq.), shall be allowed a credit against the tax otherwise due pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5), sections 2 and 3 of P.L.1945, c.132 (C.54:18A-2 and C.54:18A-3), section 1 of P.L.1950, c.231 (C.17:32-15), or N.J.S.17B:23-5, for a portion of the cost of rehabilitation paid by the business entity for the rehabilitation of a qualified property or transformative project, if the cost of rehabilitation during a business entity's selected rehabilitation period is not less than the greater of (a) the adjusted basis of the structure of the qualified property or transformative project used for federal income tax purposes as of the beginning of the business entity's selected rehabilitation period, or (b) $5,000. The amount of the credit claimed in any accounting or privilege period shall not reduce the amount of the tax liability to less than the statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162 (C.54:10A-5).
(2) The amount of credit allowed to a business entity pursuant to this section shall be as follows:
(a) for the rehabilitation of a qualified property located in a qualified incentive tract or government-restricted municipality, [45] 60 percent of the cost of rehabilitation paid by the business entity for the rehabilitation of the qualified property or [$8] $12 million, whichever is less;
(b) for the rehabilitation of a transformative project, 45 percent of the cost of rehabilitation paid by the business entity for the rehabilitation of the transformative project or $50 million, whichever is less; and
(c) for the rehabilitation of any other qualified property not subject to provisions of subparagraph (a) or (b) of this paragraph, [40] 50 percent of the cost of rehabilitation paid by the business entity for the rehabilitation of the qualified property or [$4] $8 million, whichever is less.
(3) The prevailing wage requirement for construction work shall apply at a qualified property or transformative project during the selected rehabilitation period, and the prevailing wage requirement for building services work shall apply at a qualified property or transformative project for 10 years following completion of the rehabilitation work at the qualified property or transformative project. In the event a qualified property or transformative project, or the aggregate of all qualified properties and transformative projects approved for awards under the program, constitute a lease of more than 35 percent of a facility, the prevailing wage requirements shall apply to the entire facility.
(4) Prior to approval of an application by the authority, the authority shall confirm with the Department of Labor and Workforce Development, the Department of Environmental Protection, and the Department of the Treasury whether the business entity is in substantial good standing with the respective department or has entered into an agreement with the respective department that includes a practical corrective action plan for the business entity. The business entity shall certify that any contractors or subcontractors that perform work at the qualified property or transformative project: (a) are registered as required by "The Public Works Contractor Registration Act," P.L.1999, c.238 (C.34:11-56.48 et seq.); (b) have not been debarred by Department of Labor and Workforce Development from engaging in or bidding on Public Works Contracts in New Jersey; and (c) possess a tax clearance certificate issued by the Division of Taxation in the Department of the Treasury. The authority may also contract with an independent third party to perform a background check on the business entity. Following approval of an application by the authority, but prior to the start of any construction or rehabilitation at the qualified property or transformative project, the authority shall enter into a rehabilitation agreement with the business entity. The authority shall negotiate the terms and conditions of the rehabilitation agreement on behalf of the State.
(5) A rehabilitation project shall be eligible for a tax credit only if the business entity demonstrates to the authority at the time of application that:
(a) without the tax credit, the rehabilitation project is not economically feasible; and
(b) a project financing gap exists for a rehabilitation project that has a total rehabilitation cost or total facade rehabilitation cost equal to or greater than $5 million and is located outside of a government-restricted municipality.
(6) For the purposes of paragraph (4) of this subsection, the start of any construction or rehabilitation shall not be deemed to include:
(a) work approved by the New Jersey Historic Trust or the New Jersey State Historic Preservation Office as meeting the Secretary of the Interior's Standards for Rehabilitation pursuant to section 67.7 of Title 36, Code of Federal Regulations (36 C.F.R. s.67.7);
(b) work ordered by a building code or other official with jurisdiction over the site of the qualified property or transformative project to correct a health, safety, or other hazard and completed in accordance with the Secretary of the Interior's Standards for Rehabilitation pursuant to section 67.7 of Title 36, Code of Federal Regulations (36 C.F.R. s.67.7);
(c) work completed more than two years prior to the date of application; or
(d) work completed within two years of application and in accordance with the Secretary of the Interior's Standards for Rehabilitation pursuant to section 67.7 of Title 36, Code of Federal Regulations (36 C.F.R. 67.7).
(7) Any work completed before the start of construction or rehabilitation may be considered as part of the project, but shall not be a cost of rehabilitation or cost of facade rehabilitation.
b. A business entity may claim a credit under this section during the accounting or privilege period: (1) in which it makes the final payment for the cost of the rehabilitation if the business entity has chosen a selected rehabilitation period of 24 months; or (2) in which a distinct project phase of the rehabilitation is completed if the business entity has chosen a selected rehabilitation period of 60 months. The credit may be claimed against any State tax, listed in paragraph (1) of subsection a. of this section, liability otherwise due after any other credits permitted pursuant to law have been applied. The amount of credit claimed in an accounting or privilege period that cannot be applied for that accounting or privilege period due to limitations in this section may be transferred pursuant to section 5 of P.L.2020, c.156 (C.34:1B-273) or carried over, if necessary, to the nine accounting or privilege periods following the accounting or privilege period for which the credit was allowed.
c. A business entity shall submit to the authority satisfactory evidence of the actual cost of rehabilitation, as certified by a certified public accountant, evidence of completion of the rehabilitation or phase, and a certification that all information provided by the business entity to the authority is true, including information contained in the application, the rehabilitation agreement, any amendment to the rehabilitation agreement, and any other information submitted by the business entity to the authority pursuant to sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276). The business entity, or an authorized agent of the business entity, shall certify under the penalty of perjury that the information provided pursuant to this subsection is true.
(cf: P.L.2021, c.160, s.2)
3. Section 6 of P.L.2020, c.156 (C.34:1B-274) is amended to read as follows:
6. a. The authority shall, in consultation with the officer and the director, promulgate rules and regulations in accordance with the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), as the officer deems necessary to administer the provisions of sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276), including but not limited to rules establishing administrative fees to implement the provisions of sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276), and setting of an annual application submission date, requiring annual reporting by each business entity that receives a tax credit pursuant to sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276). As part of the authority's review of the annual reports required from each business entity that receives a tax credit, the authority shall confirm with the Department of Labor and Workforce Development, the Department of Environmental Protection, and the Department of the Treasury that: the business entity is in substantial good standing with the respective department, or has entered into an agreement with the respective department that includes a practical corrective action plan for the business entity, and the business entity shall certify that any contractors or subcontractors performing work at the qualified property or transformative project: (1) are registered as required by "The Public Works Contractor Registration Act," P.L.1999, c.238 (C.34:11-56.48 et seq.); (2) have not been debarred by the Department of Labor and Workforce Development from engaging in or bidding on Public Works Contracts in the State; and (3) possess a tax clearance certificate issued by the Division of Taxation in the Department of the Treasury. The rules and regulations adopted pursuant to this section shall also include a provision to require that business entities forfeit all tax credits awarded in any year in which the Department of Labor and Workforce Development, the Department of Environmental Protection, or the Department of the Treasury advises the authority that the business entity is not in substantial good standing nor has the business entity entered into an agreement with the respective department that includes a practical corrective action plan, and to allow the authority to extend, in individual cases, the deadline for any annual reporting or certification requirement established pursuant to this section.
b. For every tax credit allowed pursuant to section 4 of P.L.2020, c.156 (C.34:1B-272), the authority, in consultation with the officer, shall certify to the director: the total cost of rehabilitation or total cost of facade rehabilitation project; that the property meets the definition of qualified property or transformative project, as applicable; and that the rehabilitation or facade rehabilitation project has been completed in substantial compliance with the requirements of the Secretary of the Interior's Standards for Rehabilitation pursuant to section 67.7 of Title 36, Code of Federal Regulations. The business entity shall attach the certification to the tax return on which the business entity claims the credit.
c. (1) The total amount of credits approved by the authority pursuant to sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276) shall not exceed the limitations set forth in section 98 of P.L.2020, c.156 (C.34:1B-362). For the purpose of determining the aggregate value of tax credits approved in a fiscal year, a tax credit shall be deemed to have been approved at the time the authority approves an application for an award of a tax credit. If the authority approves less than the total amount of tax credits authorized pursuant to this subsection in a fiscal year, the remaining amount, plus any amounts remaining from previous fiscal years, shall be added to the limit of subsequent fiscal years until that amount of tax credits are claimed or allowed. Any unapproved, uncertified, or recaptured portion of tax credits during any fiscal year may be carried over and reallocated in succeeding years.
(2) Notwithstanding the provisions of paragraph (1) of this subsection and section 98 of P.L.2020, c.156 (C.34:1B-362) to the contrary, the authority may approve tax credits, pursuant to sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276), for the rehabilitation of a transformative project in an amount that causes the total amount of credits approved during the fiscal year to exceed the limitations set forth in section 98 of P.L.2020, c.156 (C.34:1B-362), provided that the amount of the excess shall be subtracted from the total amount of credits that may be approved by the authority in the subsequent fiscal year, and the amount of the excess shall not exceed 50 percent of the total tax credits otherwise authorized for the fiscal year.
(3) The authority, in consultation with the officer, shall devise criteria for allocating tax credit amounts if the approved amounts combined exceed the total amount in each fiscal year, including rules that allocate over multiple fiscal years a single credit amount granted in excess of $2,000,000. The criteria shall include a project's historic importance, positive impact on the surrounding neighborhood, economic sustainability, geographic diversity, and consistency with Statewide growth and development policies and plans.
(4) At the authority's discretion, up to 50 percent of the tax credits available for distribution in any given year may be allocated to facade rehabilitation projects. The amount of credit allowed to a business entity pursuant to this paragraph shall be 50 percent of the cost of facade rehabilitation for a project or $4 million, whichever is less. The tax credits allocated pursuant to this paragraph shall be awarded through a competitive application process whereby the authority shall evaluate all applications submitted by a date certain, as if all received applications were submitted on that date. Notwithstanding the provisions of section 4 of P.L.2020, c.156 (C.34:1B-272), a project financing gap analysis shall not be required for the submission or approval of these applications. When scoring applications, the authority shall consider factors including, but not limited to: the retention of existing historic fabric versus demolition; building location, with preference given to buildings that contribute to the historic significance of a historic district; and the amount of community support for the project.
d. Notwithstanding any provision of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), to the contrary, the chief executive officer of the authority may adopt, immediately upon filing with the Office of Administrative Law, rules and regulations necessary to implement the provisions of P.L. , c. (pending before the Legislature as this bill). The rules and regulations adopted pursuant to this section shall be effective for a period not to exceed 365 days following the date of filing and may thereafter be amended, adopted, or readopted by the director in accordance with the requirements of P.L.1968, c.410 (C.52:14B-1 et seq.).
(cf: P.L.2021, c.160, s.4)
4. Section 7 of P.L.2020, c.156 (C.34:1B-275) is amended to read as follows:
7. a. The authority, in collaboration with the director, shall adopt rules for the recapture of an entire or partial tax credit amount allowed under sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276). The rules shall require the authority to notify the director of the recapture of an entire or partial tax credit amount. Recaptured funds shall be deposited in the General Fund of the State.
b. If, before the end of five full years after the completion of the rehabilitation of the qualified property or transformative project, a developer that has received a tax credit pursuant to section 4 of P.L.2020, c.156 (C.34:1B-272) modifies the qualified property or transformative project so that it ceases to meet the requirements for the rehabilitation of a qualified property or transformative project as defined under the program or ceases to meet the requirement of the rehabilitation agreement then the tax credit allowed under the program shall be recaptured in accordance with the rules adopted pursuant to subsection a. of this section.
c. In the case of a business entity that has chosen a selected rehabilitation period of 60 months, if the architectural plans change in the course of the phased rehabilitation project so that the rehabilitation of the qualified property or transformative project would, upon the rehabilitation's completion, no longer qualify for a tax credit pursuant to the requirements of sections 2 through 8 of P.L.2020, c.156 (C.34:1B-270 through C.34:1B-276), then the [business entity's tax liability for that accounting or privilege period shall be increased by the full amount of the tax credit that the authority had previously granted upon the completion of a distinct prior project phase that the business entity has applied against its tax liability in a prior accounting or privilege period] tax credits issued shall be subject to recapture. Any portion of the tax credit that the business entity has not yet used at the time of the disallowance by the officer shall be deemed void.
(cf: P.L.2020, c.156, s.7)
5. Section 10 of P.L.2020, c.156 (C.34:1B-278) is amended to read as follows:
10. As used in sections 9 through 19 of P.L.2020, c.156 (C.34:1B-277 through C.34:1B-287):
"Authority" means the New Jersey Economic Development Authority established by section 4 of P.L.1974, c.80 (C.34:1B-4).
"Board" means the Board of the New Jersey Economic Development Authority, established pursuant to section 4 of P.L.1974, c.80 (C.34:1B-4).
"Brownfield site" means any [former or current commercial or industrial site] real property in this State that is currently vacant or underutilized and on which there has been, or there is suspected to have been, a discharge of a contaminant or on which there is contaminated building material.
"Building services" means any cleaning or routine building maintenance work, including, but not limited to, sweeping, vacuuming, floor cleaning, cleaning of rest rooms, collecting refuse or trash, window cleaning, securing, patrolling, or other work in connection with the care or securing of an existing building, including services typically provided by a door-attendant or concierge. "Building services" shall not include any skilled maintenance work, professional services, or other public work for which a contractor is required to pay the "prevailing wage" as defined in section 2 of P.L.1963, c.150 (C.34:11-56.26).
"Contaminated building material" means components of a structure where abatement or removal of asbestos, or remediation of materials containing hazardous substances defined pursuant to section 3 of P.L.1976, c.141 (C.58:10-23.11b), is required by applicable federal, state, or local rules or regulations.
"Contamination" or "contaminant" means any discharged hazardous substance as defined pursuant to section 3 of P.L.1976, c.141 (C.58:10-23.11b), hazardous waste as defined pursuant to section 1 of P.L.1976, c.99 (C.13:1E-38), pollutant as defined pursuant to section 3 of P.L.1977, c.74 (C.58:10A-3), or contaminated building material.
"Department" means the Department of Environmental Protection.
"Developer" means any person that enters or proposes to enter into a redevelopment agreement with the authority pursuant to the provisions of section 13 of P.L.2020, c.156 (C.34:1B-281).
"Director" means the Director of the Division of Taxation in the Department of the Treasury.
"Equity" means developer-contributed capital that may consist of cash, costs for project feasibility incurred within the 12 months prior to application, property value less any mortgages when the developer owns the project site, and any other investment by the developer in the project that the authority deems acceptable. Property value shall be an amount equal to the lesser of: (1) the purchase price, provided the property was purchased pursuant to an arm's length transaction within 12 months of application; or (2) the value as determined by a current appraisal acceptable to the authority. "Equity" includes federal or local grants and proceeds from the sale of federal or local tax credits, including, but not limited to, any federal tax credits that the redevelopment receives pursuant to section 42 of the federal Internal Revenue Code of 1986 (26 U.S.C. s.42) and section 45D of the federal Internal Revenue Code of 1986 (26 U.S.C. s.45D). "Equity" shall not include State grants or tax credits or proceeds from redevelopment area bonds. For a residential project utilizing low income tax credits awarded by the New Jersey Housing and Mortgage Financing Agency pursuant to section 19 of P.L.2008, c.46 (C.52:27D-321.1), "equity" includes the portion of the developer's fee that is deferred for a minimum of five years.
"Government-restricted municipality" means a municipality in this State with a municipal revitalization index distress score of at least 75, that met the criteria for designation as an urban aid municipality in the 2019 State fiscal year, and that, on the effective date of P.L.2020, c.156 (C.34:1B-269 et al.), is subject to financial restrictions imposed pursuant to the "Municipal Stabilization and Recovery Act," P.L.2016, c.4 (C.52:27BBBB-1 et seq.), or is restricted in its ability to levy property taxes on property in that municipality as a result of the State of New Jersey owning or controlling property representing at least 25 percent of the total land area of the municipality or as a result of the federal government of the United States owning or controlling at least 50 acres of the total land area of the municipality, which is dedicated as a national natural landmark.
"Labor harmony agreement" means an agreement between a business that serves as the owner or operator of a retail establishment or distribution center and one or more labor organizations, which requires, for the duration of the agreement: that any participating labor organization and its members agree to refrain from picketing, work stoppages, boycotts, or other economic interference against the business; and that the business agrees to maintain a neutral posture with respect to efforts of any participating labor organization to represent employees at an establishment or other unit in the retail establishment or distribution center, agrees to permit the labor organization to have access to the employees, and agrees to guarantee to the labor organization the right to obtain recognition as the exclusive collective bargaining representatives of the employees in an establishment or unit at the retail establishment or distribution center by demonstrating to the New Jersey State Board of Mediation, Division of Private Employment Dispute Settlement, or a mutually agreed-upon, neutral, third-party, that a majority of workers in the unit have shown their preference for the labor organization to be their representative by signing authorization cards indicating that preference. The labor organization or organizations shall be from a list of labor organizations that have requested to be on the list and that the Commissioner of Labor and Workforce Development has determined represent substantial numbers of retail or distribution center employees in the State.
"Licensed site remediation professional" means an individual who is licensed by the Site Remediation Professional Licensing Board pursuant to section 7 of P.L.2009, c.60 (C.58:10C-7) or the department pursuant to section 12 of P.L.2009, c.60 (C.58:10C-12).
"Program" means the Brownfields Redevelopment Incentive Program established by section 11 of P.L.2020, c.156 (C.34:1B-279).
"Project financing gap" means the part of the total remediation cost, including reasonable and appropriate return on investment, that remains to be financed after all other sources of capital have been accounted for, including, but not limited to, developer contributed capital, which shall not be less than 20 percent of the total remediation cost, and investor or financial entity capital or loans for which the developer, after making all good faith efforts to raise additional capital, certifies that additional capital cannot be raised from other sources; provided, however, that for a redevelopment project located in a government-restricted municipality, the developer contributed capital shall not be less than 10 percent of the cost of rehabilitation. When an applicant is proposing a new project, the project financing gap shall consider the cost of the full project, but the award size shall be based on remediation costs. Developer contributed capital may consist of cash, deferred development fees, costs for project feasibility incurred within the 12 months prior to application, property value less any mortgages when the developer owns the project site, and any other investment by the developer in the project deemed acceptable by the authority, as provided by regulations promulgated by the authority. Property value shall be valued at the lesser of either: a. the purchase price, provided the property was purchased pursuant to an arm's length transaction within 12 months of application; or b. the value as determined by a current appraisal.
"Qualified incentive tract" means: a. a population census tract having a poverty rate of 20 percent or more; or b. a census tract in which the median family income for the census tract does not exceed 80 percent of the greater of the Statewide median family income or the median family income of the metropolitan statistical area in which the census tract is situated.
"Redevelopment agreement" means an agreement between the authority and a developer under which the developer agrees to perform any work or undertaking necessary for the remediation of a brownfield site located at the site of the redevelopment project[, and for the clearance, development or redevelopment, construction, reconstruction, or rehabilitation of any structure or improvement of commercial, industrial, or public structures or improvements within an area of land whereon a brownfield site is located].
"Redevelopment project" means a specific [construction] remediation project [or improvement] undertaken, pursuant to the terms of a redevelopment agreement, by a developer within an area of land whereon a brownfield site is located. [A redevelopment project may involve construction or improvement upon lands, buildings, improvements, or real and personal property, or any interest therein, including lands under water, riparian rights, space rights, and air rights, acquired, owned, developed or redeveloped, constructed, reconstructed, rehabilitated, or improved.]
"Remediation" or "remediate" means all necessary actions to investigate and clean up or respond to any known, suspected, or threatened discharge of contaminants, including, as necessary, the preliminary assessment, site investigation, remedial investigation, and remedial action, or any portion thereof, as those terms are defined in section 23 of P.L.1993, c.139 (C.58:10B-1); and hazardous materials abatement; hazardous materials or waste disposal; building and structural remedial activities, including, but not limited to, demolition, asbestos abatement, polychlorinated biphenyl removal, improvement and capping of landfills, contaminated wood or paint removal, or other infrastructure remedial activities; provided, however, "remediation" or "remediate" shall not include the payment of compensation for damage to, or loss of, natural resources.
"Remediation costs" means all reasonable costs associated with the remediation of a contaminated site, except any costs incurred in financing the remediation.
(cf: P.L.2021, c.160, s.5)
6. Section 12 of P.L.2020, c.156 (C.34:1B-280) is amended to read as follows:
12. a. A developer seeking a tax credit for a redevelopment project shall submit an application to the authority and the department in a form and manner prescribed in regulations adopted by the authority, in consultation with the department, pursuant to the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.).
b. A redevelopment project shall be eligible for a tax credit only if the developer demonstrates to the authority and the department at the time of application that:
(1) except as ordered by a government official with jurisdiction over the brownfield site or certified by a Licensed Site Remediation Professional to correct or prevent the spread of a health, safety, or other hazard, and as provided in subsection j. of this section, the developer has not commenced any remediation or clean up at the site of the redevelopment project, except for preliminary assessments and investigations, prior to applying for a tax credit pursuant to this section, but intends to remediate [and redevelop] the site immediately upon approval of the tax credit;
(2) the redevelopment project is located on a brownfield site;
(3) without the tax credit, the redevelopment project is not economically feasible;
(4) a project financing gap exists for projects located outside of a government-restricted municipality that have a total remediation cost of $5,000,000 or greater;
(5) the developer [has obtained and submitted] shall obtain and submit to the authority, before approval by the board, a letter evidencing support for the redevelopment project from the governing body of the municipality in which the redevelopment project is located; and
(6) each worker employed to perform remediation, construction, or building services work at the redevelopment project shall be paid not less than the prevailing wage rate for the worker's craft or trade, as determined by the Commissioner of Labor and Workforce Development pursuant to P.L.1963, c.150 (C.34:11-56.25 et seq.). The prevailing wage requirements shall apply for remediation or construction work through the completion of the redevelopment project, and the prevailing wage requirements shall apply for building services work at the site of the redevelopment project for 10 years following completion of the redevelopment project. In the event a redevelopment project, or the aggregate of all redevelopment projects approved for an award under the program, constitute a lease of more than 35 percent of a facility, the prevailing wage requirements shall apply to the entire facility.
c. A redevelopment project that received a reimbursement pursuant to sections 34 through 39 of P.L.1997, c.278 (C.58:10B-26 through 58:10B-31) shall not be eligible to apply for a tax credit under the program. If the authority receives an application and supporting documentation for approval of a reimbursement pursuant to sections 34 through 39 of P.L.1997, c.278 (C.58:10B-26 through 58:10B-31) prior to the effective date of sections 9 through 19 of P.L.2020, c.156 (C.34:1B-277 through C.34:1B-287), then the authority may consider the application and award a tax credit to a developer, provided that the authority shall take final action on all applications for approval of a reimbursement pursuant to sections 34 through 39 of P.L.1997, c.278 (C.58:10B-26 through 58:10B-31) no later than July 1, 2019. No applications shall be submitted pursuant to sections 34 through 39 of P.L.1997, c.278 (C.58:10B-26 through 58:10B-31) after the effective date of sections 9 through 19 of P.L.2020, c.156 (C.34:1B-277 through C.34:1B-287).
d. (1) Prior to approval of an application, the authority shall confirm with the Department of Labor and Workforce Development, the Department of Environmental Protection, and the Department of the Treasury whether the developer is in substantial good standing with the respective department, or has entered into an agreement with the respective department that includes a practical corrective action plan for the developer. The authority may also contract with an independent third party to perform a background check on the developer. The developer shall certify that any contractors or subcontractors that perform work at the redevelopment project: (a) are registered as required by "The Public Works Contractor Registration Act," P.L.1999, c.238 (C.34:11-56.48 et seq.); (b) have not been debarred by the Department of Labor and Workforce Development from engaging in or bidding on Public Works Contracts in New Jersey, and (c) possess a tax clearance certificate issued by the Division of Taxation in the Department of the Treasury. Provided that the developer is in substantial good standing with the Department of Labor and Workforce Development, the Department of Environmental Protection, and the Department of the Treasury, or has entered into such an agreement, and following approval of an application by the board, the authority shall enter into a redevelopment agreement with the developer, as provided for in section 13 of P.L.2020, c.156 (C.34:1B-281).
(2) The authority, in consultation with the department, may impose additional requirements upon an applicant through rule or regulation adopted pursuant to the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), if the authority or the department determines the additional requirements to be necessary and appropriate to effectuate the purposes of sections 9 through 19 of P.L.2020, c.156 (C.34:1B-277 through C.34:1B-287).
e. The authority, in consultation with the department, shall conduct a review of the applications on a rolling basis, unless the authority determines that demand is likely to exceed available tax credits, and then through a competitive application process whereby the authority and the department shall evaluate all applications submitted by a date certain, as if all received applications were submitted on that date. To receive a tax credit award, a developer's application shall meet a minimum score, as determined by the authority. In addition to the eligibility criteria set forth in subsection b. of this section, the authority, in consultation with the department, may consider additional factors that may include, but shall not be limited to: the economic feasibility of the redevelopment project; the benefit of the redevelopment project to the community in which the remediation project is located; the degree to which the redevelopment project enhances and promotes [job creation and] economic development and reduces environmental or public health stressors in an overburdened community, as those terms are defined by section 2 of P.L.2020, c.92 (C.13:1D-158), and attendant department regulations; and, if the developer has a board of directors, the extent to which that board of directors is diverse and representative of the community in which the redevelopment project is located. The authority, in consultation with the department, shall submit applications that comply with the eligibility criteria set forth in this section, fulfill the additional factors considered by the authority pursuant to this subsection, satisfy the submission requirements, and provide adequate information for the subject application, to the board for final approval.
f. The authority shall award tax credits to redevelopment projects until either the available tax credits are exhausted or all redevelopment projects that are eligible for a tax credit pursuant to the provisions of sections 9 through 19 of P.L.2020, c.156 (C.34:1B-277 through C.34:1B-287) receive a tax credit, whichever occurs first. If insufficient funding exists to allow a tax credit to a developer in accordance with the provisions of subsection a. of section 16 of P.L.2020, c.156 (C.34:1B-284), the authority may offer the developer a value of the tax credit below the amount provided for in subsection a. of section 16 of P.L.2020, c.156 (C.34:1B-284).
g. A developer shall pay to the authority or to the department, as appropriate, the full amount of the direct costs of an analysis concerning the developer's application for a tax credit, which a third party retained by the authority or department performs, if the authority or department deems such retention to be necessary.
h. If the authority determines that a developer made a material misrepresentation on the developer's application, the developer shall forfeit all tax credits awarded under the program.
i. If circumstances require a developer to amend its application to the authority, then the developer, or an authorized agent of the developer, shall certify to the authority that the information provided in its amended application is true, under the penalty of perjury.
j. A developer who has commenced remediation or clean up at the site and who could not reasonably have known the full extent of the site contamination prior to commencing the remediation may still apply for a tax credit under the program, if the developer certifies to the authority, under the penalty of perjury, that the developer cannot reasonably finish the remediation and commence the redevelopment project absent the tax credit.
(cf: P.L.2021, c.160, s.6)
7. Section 13 of P.L.2020, c.156 (C.34:1B-281) is amended to read as follows:
13. a. Following approval of an application by the board, but prior to the start of any remediation or clean up at the site of the redevelopment project, except activities disclosed at the time of approval or those in accordance with section 12 of P.L.2020, c.156 (C.34:1B-280), the authority shall enter into a redevelopment agreement with the developer. The chief executive officer of the authority shall negotiate the terms and conditions of the redevelopment agreement on behalf of the State.
b. The redevelopment agreement shall specify the amount of the tax credit to be awarded to the developer, the date on which the developer shall complete the remediation, and the projected project remediation cost. The redevelopment agreement shall require the developer to submit progress reports to the authority and to the department every six months pursuant to section 15 of P.L.2020, c.156 (C.34:1B-283).
c. The authority shall not enter into a redevelopment agreement with a developer unless:
(1) the redevelopment project complies with standards established by the authority in accordance with the green building manual prepared by the Commissioner of Community Affairs pursuant to section 1 of P.L.2007, c.132 (C.52:27D-130.6), regarding the use of renewable energy, energy-efficient technology, and non-renewable resources to reduce environmental degradation and encourage long-term cost reduction;
(2) the redevelopment project complies with the authority's affirmative action requirements, adopted pursuant to section 4 of P.L.1979, c.303 (C.34:1B-5.4); and
(3) the developer pays each worker employed to perform remediation work, construction work, or building services work at the redevelopment project not less than the prevailing wage rate in accordance with the requirements of paragraph (6) of subsection b. of section 12 of P.L.2020, c.156 (C.34:1B-280) for the worker's craft or trade, as determined by the Commissioner of Labor and Workforce Development pursuant to P.L.1963, c.150 (C.34:11-56.25 et seq.).
d. The authority shall not enter into a redevelopment agreement unless the developer demonstrates, to the satisfaction of the Department of Environmental Protection, that the developer did not discharge a hazardous substance at the brownfield site proposed to be in the redevelopment agreement[, is not in any way responsible for the hazardous substance,] and is not a corporate successor to the discharger or to any person in any way responsible for the hazardous substance or to anyone liable for cleanup and removal costs pursuant to section 8 of P.L.1976, c.141 (C.58:10-23.11g).
e. (1) Except as provided in paragraph (2) of this subsection, the authority shall not enter into a redevelopment agreement for a redevelopment project that includes at least one retail establishment that will have more than 10 employees, or at least one distribution center that will have more than 20 employees, unless the redevelopment agreement includes a precondition that any business that serves as the owner or operator of the retail establishment or distribution center enters into a labor harmony agreement with a labor organization or cooperating labor organizations which represent retail or distribution center employees in the State.
(2) A labor harmony agreement shall be required only if the State has a proprietary interest in the redevelopment project and shall remain in effect for as long as the State acts as a market participant in the redevelopment project. The authority may enter into a redevelopment agreement with a developer without the labor harmony agreement required under paragraph (1) of this subsection only if the authority determines that the redevelopment project would not be feasible if a labor harmony agreement is required. The authority shall support the determination by a written finding, which provides the specific basis for the determination.
(3) [As used in this subsection, "labor harmony agreement" means an agreement between a business that serves as the owner or operator of a retail establishment or distribution center and one or more labor organizations, which requires, for the duration of the agreement: that any participating labor organization and its members agree to refrain from picketing, work stoppages, boycotts, or other economic interference against the business; and that the business agrees to maintain a neutral posture with respect to efforts of any participating labor organization to represent employees at an establishment or other unit in the retail establishment or distribution center, agrees to permit the labor organization to have access to the employees, and agrees to guarantee to the labor organization the right to obtain recognition as the exclusive collective bargaining representatives of the employees in an establishment or unit at the retail establishment or distribution center by demonstrating to the New Jersey State Board of Mediation, Division of Private Employment Dispute Settlement, or a mutually agreed-upon, neutral, third-party, that a majority of workers in the unit have shown their preference for the labor organization to be their representative by signing authorization cards indicating that preference. The labor organization or organizations shall be from a list of labor organizations that have requested to be on the list and that the Commissioner of Labor and Workforce Development has determined represent substantial numbers of retail or distribution center employees in the State.] (Deleted by amendment, P.L. , c. ) (pending before the Legislature as this bill)
f. The redevelopment agreement shall provide that issuance of a tax credit under the program shall be conditioned upon the subrogation to the department of all rights of the developer to recover remediation costs from any other person who discharges a hazardous substance or is in any way responsible, pursuant to section 8 of P.L.1976, c.141 (C.58:10-23.11g), for a hazardous substance that was discharged at the brownfield site.
g. A developer may seek a revision to the redevelopment agreement if the developer cannot complete the remediation on or before the date set forth in the redevelopment agreement. A developer's ability to change the date on which the developer shall complete the remediation shall be subject to the availability of tax credits in the year of the revised date of completion.
h. A developer shall submit to the authority satisfactory evidence of the actual remediation costs, as certified by a certified public accountant, and a Licensed Site Remediation Professional for costs under the jurisdiction of the "Site Remediation Reform Act," sections 1 through 29 of P.L.2009, c.60 (C.58:10C-1 et seq.), and as applicable, other appropriate licensed or certified professional for costs that are not under the jurisdiction of the "Site Remediation Reform Act," evidence of completion of the remediation as demonstrated by a Response Action Outcome where the remediation is subject to the "Site Remediation Reform Act," a certification from the appropriate licensed or certified professional for other remedial activities, and a certification that all information provided by the developer to the authority is true, including information contained in the application, the redevelopment agreement, any amendment to the redevelopment agreement, and any other information submitted by the developer to the authority pursuant to sections 9 through 19 of P.L.2020, c.156 (C.34:1B-277 through C.34:1B-287). The developer, or an authorized agent of the developer, shall certify under the penalty of perjury that the information provided pursuant to this subsection is true.
i. The redevelopment agreement shall include a provision allowing the authority to recapture the tax credits for any year in which the Department of Environmental Protection, the Department of Labor and Workforce Development, or the Department of the Treasury that advises the authority that the developer is not in substantial good standing with the respective department, nor has the developer entered into an agreement with the respective department that includes a practical corrective action plan for the developer. The redevelopment agreement shall also include a provision allowing the authority to recapture the tax credits for any year in which the developer fails to confirm that each contractor or subcontractor performing work at the redevelopment project: (1) is registered as required by "The Public Works Contractor Registration Act," P.L.1999, c.238 (C.34:11-56.48 et seq.); (2) has not been debarred by the Department of Labor and Workforce Development from engaging in or bidding on Public Works Contracts in New Jersey; and (3) possesses a tax clearance certificate issued by the Division of Taxation in the Department of the Treasury. [The redevelopment agreement shall also require a developer to engage in on-site consultations with the Division of Workplace Safety and Health in the Department of Health.]
(cf: P.L.2021, c.160, s.7)
8. Section 14 of P.L.2020, c.156 (C.34:1B-282) is amended to read as follows:
14. [To] In addition to the submission of any additional evidence that the authority may request to verify that activities comply with local, state, and federal regulations, to qualify for a tax credit under the program, a developer shall, as applicable:
a. enter into [a memorandum of agreement] an administrative consent order or other oversight document with the Commissioner of Environmental Protection in accordance with the provisions of section 37 of P.L.1997, c.278 (C.58:10B-29); [or]
b. comply with the requirements set forth in subsection b. of section 30 of P.L.2009, c.60 (C.58:10B-1.3) for the remediation of the site of the redevelopment project; or
c. comply with the rules, regulations, and guidelines by the federal government, the New Jersey Department of Labor and Workforce Development, the New Jersey Department of Health, and the New Jersey Department of Community Affairs regarding requirements for remediation of asbestos, contaminated paint, polychlorinated biphenyls, and other environmental hazards.
(cf: P.L.2020, c.156, s.14)
9. Section 16 of P.L.2020, c.156 (C.34:1B-284) is amended to read as follows:
16. a. Upon completion of the remediation, the developer shall seek certification from the authority, in consultation with the department, that:
(1) the remediation is complete;
(2) the developer complied with the requirements of section 14 of P.L.2020, c.156 (C.34:1B-282), as applicable, and section 15 of P.L.2020, c.156 (C.34:1B-283)[, including the requirements of any memorandum of agreement or other oversight document that the developer may have executed with the Commissioner of Environmental Protection pursuant to that section]; and
(3) the remediation costs were actually and reasonably incurred.
Upon receipt of certification, and confirmation by the authority that the developer's obligations under the redevelopment agreement have been met, a developer shall be awarded a credit against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5), sections 2 and 3 of P.L.1945, c.132 (C.54:18A-2 and C.54:18A-3), section 1 of P.L.1950, c.231 (C.17:32-15), or N.J.S.17B:23-5 as follows: (a) for project located in a qualified incentive tract or government-restricted municipality, in an amount not to exceed [60] 80 percent of the actual remediation costs, or [60] 80 percent of the projected remediation costs as set forth in the redevelopment agreement, or [$8,000,000] $12,000,000, whichever is least; [and] (b) for a project erecting a solar panel array on the site of a closed sanitary landfill, in an amount not to exceed 100 percent of the costs of remediation and capping of the landfill, or $12,000,000 if the project is located in a qualified incentive tract or government-restricted municipality, or $8,000,000 if the project is located anywhere else in the State, whichever is least; and (c) for all other projects, in an amount not to exceed [50] 60 percent of the actual remediation costs, or [50] 60 percent of the projected remediation costs as set forth in the redevelopment agreement, or [$4,000,000] $8,000,000, whichever is least. The developer, or an authorized agent of the developer, shall certify that the information provided to the department and the authority pursuant to this subsection is true under the penalty of perjury.
b. When filing an application for certification pursuant to subsection a. of this section, the developer shall submit to the department and the authority: (1) the total remediation costs incurred by the developer for the remediation of the subject property located at the site of the redevelopment project, as provided in the redevelopment agreement, and certified by a certified public accountant, and a Licensed Site Remediation Professional for costs under the jurisdiction of the "Site Remediation Reform Act," sections 1 through 29 of P.L.2009, c.60 (C.58:10C-1 et seq.), and as applicable, other appropriate licensed or certified professional for costs that are not under the jurisdiction of the "Site Remediation Reform Act"; (2) evidence of completion of the remediation, as demonstrated by a Response Action Outcome where the remediation is subject to the "Site Remediation Reform Act"; (3) a certification from the appropriate licensed or certified professional for other remedial activities; (4) as applicable, information concerning the occupancy rate of [the] any buildings or other work areas located on the property subject to the redevelopment agreement; and (5) such other information as the department deems necessary in order to make the certifications and findings pursuant to this section.
c. A developer shall apply the credit awarded against the developer's liability for the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5), sections 2 and 3 of P.L.1945, c.132 (C.54:18A-2 and C.54:18A-3), section 1 of P.L.1950, c.231 (C.17:32-15), or N.J.S.17B:23-5 for the privilege period during which the [department] director awards the developer a tax credit pursuant to subsection a. of this section. A developer shall not carry forward any unused credit.
d. The director shall prescribe the order of priority of the application of the credit awarded under this section and any other credits allowed by law against the tax imposed under section 5 of P.L.1945, c.162 (C.54:10A-5). The amount of the credit applied under this section against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) for a privilege period, together with any other credits allowed by law, shall not reduce the tax liability to an amount less than the statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162 (C.54:10A-5).
(cf: P.L.2021, c.160, s.8)
10. Section 19 of P.L.2020, c.156 (C.34:1B-287) is amended to read as follows:
19. a. Notwithstanding the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), to the contrary, the chief executive officer of the authority, in consultation with the Commissioner of Environmental Protection, may adopt, immediately upon filing with the Office of Administrative Law, regulations that the chief executive officer and commissioner deem necessary to implement the provisions of sections 9 through 19 of P.L.2020, c.156 (C.34:1B-277 through C.34:1B-287), which regulations shall be effective for a period not to exceed 360 days from the date of the filing. The chief executive officer, in consultation with the Commissioner of Environmental Protection, shall thereafter amend, adopt, or readopt the regulations in accordance with the requirements of P.L.1968, c.410 (C.52:14B-1 et seq.). The rules shall require annual reporting by developers that receive tax credits pursuant to the program, in addition to the regular progress updates. As part of the authority's review of the annual reports required from a developer, the authority shall confirm with the Department of Labor and Workforce Development, the Department of Environmental Protection, and the Department of the Treasury that the developer is in substantial good standing with the respective department, or has entered into an agreement with the respective department that includes a practical corrective action plan, and the developer shall certify that any contractors or subcontractors performing work at the redevelopment project: a. are registered as required by "The Public Works Contractor Registration Act," P.L.1999, c.238 (C.34:11-56.48 et seq.); b. have not been debarred by the Department of Labor and Workforce Development from engaging in or bidding on Public Works Contracts in New Jersey; and c. possess a tax clearance certificate issued by the Division of Taxation in the Department of the Treasury. The rules and regulations adopted pursuant to this section shall also include a provision to require that, in any year in which the developer is not in substantial good standing with the Department of Labor and Workforce Development, the Department of Environmental Protection, or the Department of the Treasury, the developer may forfeit all tax credits awarded in that year, and to allow the authority to extend, in individual cases, the deadline for any annual reporting requirement established pursuant to this section.
b. Notwithstanding any provision of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), to the contrary, the chief executive officer of the authority may adopt, immediately upon filing with the Office of Administrative Law, rules and regulations necessary to implement the provisions of P.L. , c. (pending before the Legislature as this bill). The rules and regulations adopted pursuant to this section shall be effective for a period not to exceed 365 days following the date of filing and may thereafter be amended, adopted, or readopted by the director in accordance with the requirements of P.L.1968, c.410 (C.52:14B-1 et seq.).
(cf: P.L.2021, c.160, s.10)
11. This act shall take effect immediately, except that: sections 2 and 3 shall apply retroactively to unapproved applications pending before December 1, 2023; sections 1 and 4 shall take effect upon adoption of the rules in accordance with section 3 and shall apply to applications received by the authority after such date; and sections 5 through 9 shall take effect upon adoption of the rules in accordance with section 10 and shall apply to applications received by the authority after such date.
STATEMENT
This bill revises various provisions
of the "New Jersey Economic Recovery Act of 2020," P.L.2020, c.156 (C.34:1B-269
et al.) concerning the Historic Property Reinvestment Program and the
Brownfields Redevelopment Incentive Program.
The Historic Property Reinvestment Program
The bill revises the amount of credits that may be awarded to eligible business entities under the program. Specifically, the bill increases the maximum size of tax credits awarded under the program and allows for certain facade rehabilitation projects to be eligible for a tax credit award.
Under the bill, the credits awarded for the rehabilitation of a qualified property located in a qualified incentive tract or government-restricted municipality are increased to 60 percent of the cost of rehabilitation or $12 million, whichever is less. Under current law, these credit amounts are equal to 45 percent of the cost of rehabilitation or $8 million, whichever is less. The credits awarded for the rehabilitation of any other qualified property, other than a transformative project, are also increased to 50 percent of the cost of rehabilitation or $8 million, whichever is less. Under current law, these credit amounts are equal to 40 percent of the cost of rehabilitation or $4 million, whichever is less. The bill also revises the tax credit eligibility requirement for a business to demonstrate a project financing gap to apply only to projects located outside of a government-restricted municipality that have a total rehabilitation cost or total façade rehabilitation cost of at least $5 million.
The bill provides the Economic Development Authority (EDA) with the discretion to make up to 50 percent of the tax credits available for distribution in a given year to be made available for facade rehabilitation projects. The value of tax credits awarded to a facade rehabilitation project are 50 percent of the project's cost of façade rehabilitation, up to a maximum of $4 million. The bill defines "facade rehabilitation projects" to mean a project consisting of the repair or reconstruction of exterior building features, including but not limited to structural components embedded within exterior walls, masonry units and mortar, exterior siding fabric, doors, windows, exterior lighting fixtures, and decorative components, such as metalwork, terracotta units and cast stone which constitute the facades of a qualified property or transformative property.
The Brownfields Redevelopment Incentive Program
The bill revises various provisions relating to the application process for a developer and, following authority approval of the application, the subsequent redevelopment agreement between a developer and the authority. The bill also provides that the EDA would accept applications on a rolling basis, unless the EDA determines that the demand for tax credits is likely to exceed the availability of credits, in which case applications would be reviewed on a competitive basis and submitted before a date certain.
Under the bill, the value of credits awarded for the remediation of a redevelopment project located in a qualified incentive tract or government-restricted municipality is increased to up to 80 percent of the actual remediation costs, 80 percent of the projected remediation costs set forth in the redevelopment agreement, or $12 million, whichever is less. Under current law, these credit amounts are equal to 60 percent of the actual remediation costs, 60 percent of the projected remediation costs set forth in the redevelopment agreement, or $8 million, whichever is less.
The bill specifies the amount of tax credits that may be awarded for a redevelopment project erecting a solar panel array on the site of a closed sanitary landfill. If the project is located in a qualified incentive tract or a government-restricted municipality, the value of the tax credit would be in an amount equal to 100 percent of the costs of remediation or $12 million, whichever is less. If the project is located anywhere else in the State, the value of tax credit would be in an amount equal to 100 percent of the costs of remediation or $8 million, whichever is less.
Under the bill, the value of credits awarded for the remediation of all other redevelopment projects is increased to up to 60 percent of the actual remediation costs, 60 percent of the projected remediation costs set forth in the redevelopment agreement, or $8 million, whichever is less. Under current law, these credit amounts are equal to 50 percent of the actual remediation costs, 50 percent of the projected remediation costs set forth in the redevelopment agreement, or $4 million, whichever is less.
