TRENTON, N.J. — A proposed bill in the New Jersey Legislature would create a new tax credit program aimed at supporting manufacturers and clean energy product manufacturers, allocating up to $500 million in redirected tax credits to qualifying businesses statewide.
The Republican sponsored bill passed an assembly vote 65-8 with 5 abstaining members. Few Republicans in the assembly voted against the clean energy bailout. One of those opposing the offshore wind bailout was Ocean County Assemblyman Greg McGuckin.
Under the proposed legislation, the New Jersey Economic Development Authority (EDA) would administer the program, awarding tax credits to businesses that meet investment, job creation, and wage standards. Eligible companies would be required to invest at least $10 million in capital improvements at a qualified business facility in New Jersey and create a minimum of 20 full-time jobs offering salaries at least 120 percent of the median manufacturing wage in the county where the facility is located.
The definition of a qualifying manufacturer under the bill includes traditional industrial production as well as clean energy sectors, such as offshore wind, solar, geothermal, battery storage, nuclear energy, and hydrogen. Clean energy manufacturers would be guaranteed access to $100 million in credits for the first two years of the program.
Key Points
- Bill redirects $500 million in credits from Aspire and Emerge programs
- Eligible businesses must invest $10 million and create 20 full-time jobs
- Clean energy manufacturers reserved $100 million in credits in first two years
Businesses approved under the program would be required to obtain site plan approval, secure financing, and enter into a project agreement with the EDA before receiving any credits. If businesses fail to meet job creation or retention targets, the EDA would be authorized to recapture or revoke the credits.
Tax credit awards are capped at the lesser of $150 million per project, 25 percent of the total capital investment, or 0.1 percent of the capital investment multiplied by the number of new full-time jobs. Bonus credits may be granted at the discretion of the EDA, pending the adoption of rules and regulations.
Companies may sell or assign the credits to other taxpayers for no less than 85 percent of face value, provided the amount transferred is at least $25,000 and done within three years of issuance. Unused credits may be carried forward for up to 10 years.
