Page 12 - RENJ June 2021
P. 12

 10 JUNE 2021
EDA ACCEPTING APPLICATIONS FOR
NEW INCENTIVES PROGRAM
devastation of the COVID-19 pandemic,” Murphy said. “The Emerge program is a well-crafted, targeted
tax incentive program that will drive job creation and equitable economic growth throughout New Jersey.”
Through the Emerge program, small and large businesses, as well as nonprofits, can apply for tax credits to support projects that meet minimum capital investment and minimum job creation or retention requirements, according to a news release. Base
tax credits will range from $500 to $4,000 per job, per year, depending
on location and other aspects of the project, with bonuses available based on project location, industry and alignment with other policy objectives that can increase annual awards to a maximum of $8,000 per job.
Most projects will receive tax credits over a seven-year eligibility period, starting after the EDA confirms the applicant has completed its investment and hired workers.
The agency outlined additional details of the program:
• Projects with significant numbers of retained jobs — either 500 or 1,000 depending on the project’s location — can receive tax credits for retained jobs, although the legislation sets the amount of tax credits for each retained job at half the amount that would be awarded for equivalent new jobs. Jobs that are covered by what’s known as
a labor harmony agreement are eligible for an additional $1,000 bonus over the capped amounts.
• To be eligible for tax credits under the Emerge program, projects must create at least 35 new full-time jobs. That job creation requirement is lower if a business is primarily engaged in a targeted industry or if a business meets the definition of
a “small business” in the program rules.
• Additionally, at least 80 percent
of incented employees’ work time must be spent in New Jersey, and the business must commit to stay in the incented location for at least 1.5 times the duration of the tax credit period. Projects may make an equivalent donation to a local Recovery Infrastructure Fund in place of investing in their project’s facility. Some requirements are relaxed for small businesses.
• All projects that receive tax credits under Emerge must meet minimum environmental standards, meet prevailing wage obligations for all
construction workers and building service workers and provide health care for employees. Projects that have a total cost of $10 million or more are also required to enter into a so-called Community Benefits Agreement with the EDA and the municipality or county in which the project is located, with the goal of monitoring compliance.
• To ensure a strong return on investment for New Jersey taxpayers, projects that receive tax credits under the Emerge program must yield a minimum net positive economic benefit to the state of 200 to 400 percent depending on project location, while awards will be limited to the amount the EDA determines
is necessary to induce the project to locate in New Jersey. The authority will also review detailed financial information about the project to verify the award of tax credits is a “material factor” in the decision to create or retain jobs in New Jersey.
The EDA noted that the Emerge program is capped with the Aspire program — a separate incentive designed to catalyze community redevelopment and provide gap financing — at $1.1 billion over six years. Any remaining tax credits left after those six years will be available in a seventh year.
To ensure the benefits are distributed equitably throughout the state, the Emerge and Aspire program cap is split between northern and southern counties for the first three years.
The complete rules for the Emerge program, including eligibility, award sizes and other information, are available at https://www.njeda.com/ emerge.
“Supporting projects that bring good jobs to New Jersey is crucial to
The state Economic Development Authority is now accepting applications for the jobs-based tax incentive known as Emerge, the long- awaited successor to the Grow New Jersey program.
Created under the Economic Recovery Act of 2020, the offering will provide employment-based tax credits as
high as $8,000 per job annually. The incentive follows in the footsteps of
a program that expired two years
ago, filling a void for office users and other companies that had helped drive activity in the commercial real estate market.
The Emerge program will make tax
credits available to projects that invest private
capital into the
state and create
 good-paying
jobs, with a
focus on certain
priority sectors,
according to the
EDA. Gov. Phil
Murphy, who
signed the Economic Recovery Act in January, hailed the program as a key step toward creating jobs across all demographics.
“It is even more important as we begin our recovery from the economic
Gov. Phil Murphy
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recovering from the COVID-19 pandemic
and achieving Governor Murphy’s vision for a stronger, fairer New Jersey,” said Tim Sullivan,
the authority’s CEO. “Launching the application for the Emerge program
is a major step forward that will open the door to exciting new economic development projects while also remaining true to our commitments to equity, transparency and accountability. This will set New Jersey on the path
to long-term, sustainable, and fair economic success.” RE
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