HAMILTON, NJ -- Governor Phil Murphy signed the landmark New Jersey Economic Recovery Act of 2020 into law on Thursday at Hamilton's Carella's Chocolate's and Gifts, a local family business for more than 80 years. The law provides economic support for small businesses, while propelling New Jersey’s economic recovery and growth for much of the next decade.
The new law bolsters the state’s startup and entrepreneur economy through implementation of the Innovation Evergreen Fund, a first-of-its-kind program that will combine state funds with private capital to support innovative new businesses. It also includes a host of new initiatives including the Main Street Recovery Finance Program, which will provide a direct $50 million appropriation for grants, loans, loan guarantees, and technical assistance to small and micro businesses.
“These programs are the product of nearly three years of hard work, during which we received input from hundreds of voices on how best to structure our state’s recovery and growth,” said Murphy. “I am immensely proud of the result, which will not only provide much needed relief for our small businesses, but will also fundamentally change economic development in our state while creating thousands of high-paying job for our residents.”
“The New Jersey Economic Recovery Act of 2020 presents a strong recovery and reform package that will position New Jersey to build a stronger and fairer economy that invests in innovation, in our communities, and in our small businesses the right way, with the protections and oversight taxpayers deserve,” said NJEDA Chief Executive Officer Tim Sullivan. “Tax incentives and other investment tools are critical to economic development, and when used correctly they can drive transformative change that uplifts communities and creates new opportunities for everyone.”
Earlier this year, the Carella's Chocolate's and Gifts e-commerce website was recreated with the help of an EDA pilot program aimed at helping restaurants, retail stores, and personal care businesses with a physical storefront continue to operate safely during the COVID-19 (coronavirus) pandemic.
The new Economic Recovery Act includes several cutting-edge programs designed to promote growth in New Jersey’s urban centers such as the Brownfields Redevelopment Incentive designed to facilitate the redevelopment of environmentally contaminated properties; the Historic Property Tax Credit, which will incentivize the restoration of historic buildings, many of which are located in New Jersey’s oldest and most distressed neighborhoods; and the Community-Anchored Development Program, which will incentivize the construction of innovative new developments by partnering with universities, hospitals, arts, and cultural organizations and give the state an equity stake in the development.
The Act also includes a groundbreaking Food Desert Relief program designed to ensure that all communities have access to fresh, healthy food. Incentives would offset the cost of development of a fresh-food grocery store in an area designated as a food desert, while also strengthening existing community assets like bodegas, corner stores, and mid-sized retailers by equipping them with the necessary equipment and infrastructure to provide healthier food options.
The legislation reforms the state’s two main tax incentive programs -- the Emerge and Aspire programs -- places caps on the amount of incentives awarded each year, as well as over the life of the programs. The Emerge program is a job creation tax credit focused on bringing new middle-class and well-paying jobs to our communities, with base and bonus structure for targeted industries and geographies. Meanwhile, the New Jersey Aspire program is a gap financing program to support commercial, industrial, mixed-use, and residential real estate development projects, with an emphasis on higher need communities.
For the first time, New Jersey’s economic development programs will include prevailing wage for building service work and labor harmony provisions, which will protect building trades and building service workers from unfair practices.
This sweeping legislation revamps several existing programs, including the successful Film and Television Tax Credit, which was expanded and enhanced to attract large studio construction to New Jersey, and the Offshore Wind Manufacturing credit, which now encompasses the entire state and will allow more businesses to qualify. Finally, several existing NJEDA programs have been folded into the legislation as well, including the Angel Investor Tax Credit, the Net Operating Loss Credit, and the New Jersey Ignite Program.
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