NJ Session Produces Economic Development Shake-Up, Incentives for Wind Energy

A new state agency to promote innovation and job creation in New Jersey was established by Gov. Chris Christie earlier this year. Envisioned as a hub for all economic development activity, the New Jersey Partnership for Action consists of three interconnected organizations to promote the state's incentives and resources, develop pro-growth policies, and assist businesses in navigating government programs. The governor's promise of a more effective strategy for economic development activity comes at the same time of severe reductions to the state's technology-based initiatives, however. High-tech business tax credits are reduced by half in the upcoming year, and with no funding allocated for the New Jersey Commission on Science and Technology, the 25-year-old agency will close its doors this month.

Established in 1985, the commission administered grant programs focused on commercializing new technologies, developing early-stage growth companies and business incubators, and enhancing New Jersey's stem cell research capability. The enacted budget also reduces by half ($30 million) funds for high-tech business tax credits, a program that allows technology and biotechnology companies that have promise but currently are notrealizing a profit to turn net operating losses and R&D tax credits into capital.

As part of the economic development re-organization within the state, Gov. Christie also discontinued the InvestNJ program within the New Jersey Economic Development Authority (EDA) earlier this year, transferring $33 million of the $33.2 million FY10 appropriation into the general fund. The program provided grants to New Jersey businesses for new job creation and for qualifying capital investments.

The newly-created New Jersey Partnership for Action will be administered by EDA in partnership with Choose New Jersey, a privately funded nonprofit organization, and Government Process Solutions, a team of business liaison representatives. The Partnership will serve as a one-stop-shop to walk new companies through the regulatory process and assist with tax incentives, Gov. Christie said in an interview with The Metropolitan Corporate Counsel. EDA will continue its role as the financing component for New Jersey job growth.

The $29.4 billion FY11 budget signed into law by Gov. Christie closes an $11 billion deficit, according to the governor's office, and is available at: http://www.njleg.state.nj.us/2010/BILLS/S3000/3000_I1.pdf.

Lawmakers also passed the Offshore Wind Economic Development Act (S2036/A2873) during the session, providing $100 million in tax credits for companies to develop offshore wind power. The measure also sets a target of 1,100 megawatts of wind generation off the New Jersey Coast, reports The Star Ledger. The bill awaits action by Gov. Christie.