ASSEMBLY, No. 2576

STATE OF NEW JERSEY

217th LEGISLATURE

INTRODUCED FEBRUARY 8, 2016

 


 

Sponsored by:

Assemblyman  REED GUSCIORA

District 15 (Hunterdon and Mercer)

Assemblywoman  ELIZABETH MAHER MUOIO

District 15 (Hunterdon and Mercer)

Assemblyman  RALPH R. CAPUTO

District 28 (Essex)

Assemblyman  RAJ MUKHERJI

District 33 (Hudson)

 

 

 

 

SYNOPSIS

     Extends urban enterprise zone designation in all qualifying municipalities for additional 10 years.

 

CURRENT VERSION OF TEXT

     As introduced.

 


An Act concerning the extension of urban enterprise zone designations and amending P.L.2001, c.347 and P.L.1983, c.303 and supplementing Title 52 of the Revised Statutes.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    Section 7 of P.L.1983, c.303 (C.52:27H-66) is amended to read as follows:

     7.    The authority shall designate enterprise zones from among those areas of qualifying municipalities determined to be eligible pursuant to P.L.1983, s.303 (C.52:27H-60 et al.). No more than 32 enterprise zones shall be in effect at any one time.  No more than one enterprise zone shall be designated in any one municipality.  Except as otherwise provided by section 11 of P.L.2001, c.347 (C.52:27H-66.6) and section 3 of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), any designation granted shall be for a period of 20 years, beginning with the year in which a zone is eligible for an exemption to the extent of [50%] 50 percent of the tax imposed under the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.), and shall not be renewed at the end of that period.  In designating enterprise zones the authority shall seek to avoid excessive geographic concentration of zones in any particular region of the State.  At least six of the 10 additional enterprise zones authorized pursuant to section 3 of P.L.1993, c.367 shall be located in counties in which enterprise zones have not previously been designated and shall be designated within 90 days of the date of the submittal of an application and zone development plan. The authority shall accept applications within 90 days of the effective date of P.L.1993, c.367. Notwithstanding the provisions of P.L.1983, c.303 (C.52:27H-60 et [seq.] al.) to the contrary, the six additional enterprise zones to be designated by the authority pursuant to the criteria for priority consideration in this section shall be entitled to an exemption to the extent of 50% of the tax imposed under the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.).  The following criteria shall be utilized in according priority consideration for designation of these zones by the authority:

     a.     One zone shall be located in a county of the second class with a population greater than 595,000 and less than 675,000 according to the latest federal decennial census and shall be located in the qualifying municipality in that county with the highest annual average number of unemployed persons and the highest average annual unemployment rate for the 1992 calendar year according to the estimate by the State Department of Labor and Workforce Development;

     b.    Two zones shall be located in a county of the second class with a population greater than 445,000 and less than 455,000 according to the latest federal decennial census, one of which shall be located in the qualifying municipality in that county with the highest annual average number of unemployed persons and the highest average annual unemployment rate for the 1992 calendar year according to the estimate by the State Department of Labor and Workforce Development, and one of which shall be located in the qualifying municipality in that county with the second highest annual average number of unemployed persons and the second highest average annual unemployment rate for the 1992 calendar year according to the estimate by the State Department of Labor and Workforce Development;

     c.     One zone shall be located in a county of the third class with a population greater than 84,000 and less than 92,000 according to the latest federal decennial census and shall be located in the qualifying municipality in that county with the highest annual average number of unemployed persons and the highest average annual unemployment rate for the 1992 calendar year according to the estimate by the State Department of Labor and Workforce Development;

     d.    One zone shall be located within two noncontiguous qualifying municipalities but comprised of not more than two noncontiguous areas each having a continuous border, if:

     (1)   both municipalities are located in the same county which shall be a county of the fifth class with a population greater than 500,000 and less than 555,000 according to the latest federal decennial census;

     (2)   the two municipalities submit a joint application and zone development plan; and

     (3)   each of the municipalities has a population greater than 16,000 and less than 30,000 and a population density of more than 5,000 persons per square mile, according to the latest federal decennial census; and

     e.     One zone shall be located within a municipality having a population greater than 38,000 and less than 46,000 according to the latest federal decennial census if the municipality is located within a county of the fifth class with a population greater than 340,000 and less than 440,000 according to the latest federal decennial census.

(cf: P.L.2004, c.75, s.2)

 

     2.    Section 11 of P.L.2001, c.347 (C.52:27H-66.6) is amended to read as follows:

     11.  a. Notwithstanding the provisions of any law, rule, regulation, or order to the contrary, the designation of an enterprise zone by the authority pursuant to P.L.1983, c.303 [(C.52:27H-60 et seq.)] (C.52:27H-60 et al.), which is located in a municipality in which the annual average of unemployed persons is equal to or greater than 2,000, or the municipal average annual unemployment rate exceeds the State average annual unemployment rate, or an enterprise zone which is located in a municipality contiguous to a municipality in which an enterprise zone is designated pursuant to P.L.1983, c.303 [(C.52:27H-60 et seq.)] (C.52:27H-60 et al.) and in which the annual average of unemployed persons is equal to or greater than 2,000 or the municipal average annual unemployment rate exceeds the State average annual unemployment rate, shall, following the expiration of the third five-year period during which the State shall have collected reduced rate revenues within the zone as provided in subsection c. of section 21 of P.L.1983, c.303 (C.52:27H-80), be extended by the authority, on a one-time basis, except as provided in section 2 of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), for a period of 16 years, within 90 days after the effective date of P.L.2001, c.347 (C.52:27H-66.2 et al.), or within 90 days after the expiration of that third five-year period, whichever is later.

     b.    During the 90-day period provided for in subsection a. of this section, the authority shall notify all qualified businesses in the enterprise zone that the benefits authorized by sections 16 through 20 of P.L.1983, c.303 (C.52:27H-75 through C.52:27H-79) shall be extended to qualified businesses in the enterprise zone commencing with the designation of the extended enterprise zone and continuing as long as a zone retains its designation as an extended enterprise zone.

     c.     Notwithstanding [any other] the provisions of any law, rule, or regulation to the contrary, 90 days after the expiration of the period provided for in subsection c. of section 21 of P.L.1983, c.303 (C.52:27H-80), except as provided in subsection b. of section 6 of P.L.1996, c.124 (C.13:1E-116.6) and, and after first depositing 10 percent of the gross amount of all revenues received from the taxation of retail sales made by certified vendors from business locations in an extended enterprise zone designated pursuant to subsection a. of this section, to which this exemption shall apply, into the account created in the name of the authority in the enterprise zone assistance fund established pursuant to section 29 of P.L.1983, c.303 (C.52:27H-88), the remaining 90 percent shall be deposited immediately upon collection by the Department of the Treasury, as follows:

     (1)   In the first five-year period, during which the State shall have collected reduced rate revenues within the extended enterprise zone, [all such] those revenues shall be deposited in the enterprise zone assistance fund [created pursuant to section 29 of P.L.1983, c.303 (C.52:27H-88)];

     (2)   In the second five-year period during which the State shall have collected reduced rate revenues within the extended enterprise zone, 66 [2/3%] and 2/3 percent of [all] those revenues shall be deposited in the enterprise zone assistance fund, and 33 [1/3%] and 1/3 percent shall be deposited in the General Fund;

     (3)   In the third five-year period during which the State shall have collected reduced rate revenues within the extended enterprise zone, 33 [1/3%] and 1/3 percent of [all] those revenues shall be deposited in the enterprise zone assistance fund, and 66 [2/3%] and 2/3 percent shall be deposited in the General Fund;

     (4)   In the [final] sixteenth year during which the State shall have collected reduced rate revenues within the extended enterprise zone, but not to exceed the life of the enterprise zone, [all] those revenues shall be deposited in the General Fund.

     The revenues required to be deposited in the enterprise zone assistance fund [under] pursuant to this section shall be used for the purposes of [that] the enterprise zone assistance fund and for the uses prescribed in section 29 of P.L.1983, c.303 (C.52:27H-88), subject to annual appropriations being made for those purposes and uses.

     d.    The designation as an extended enterprise zone pursuant to this section shall terminate if the authority determines that the municipality in which the zone is located fails to meet the criteria of subsection a. of this section for three consecutive years.  Any enterprise zone which loses its designation as an extended enterprise zone pursuant to this subsection shall be eligible to re-apply to the authority for designation as an extended enterprise zone pursuant to the provisions of P.L.1983, c.303 [(C.52:27H-60 et seq.)] (C.52:27H-60 et al.).  If the authority approves its application, an urban enterprise zone designation may be extended to the applicant in accordance with the schedules set forth in P.L.1983, c.303 [(C.52:27H-60 et seq.)] (C.52:27H-60 et al.), beginning at the point where the enterprise zone was located on [such] those schedules on the effective date of P.L.2001, c.347 (C.52:27H-66.2 et al.).

(cf: P.L.2001, c.347, s.11)

 

     3.    (New section) a. Notwithstanding the provisions of any law, rule, or regulation to the contrary, the designation of an enterprise zone by the authority in all qualifying municipalities that have been designated as enterprise zones as of the operative date of P.L.    , c.    (pending before the Legislature as this bill), shall be extended by the authority, on a one-time basis, for a period of 10 additional years beyond the date of expiration of such designation as of the operative date of P.L.    , c.    (pending before the Legislature as this bill), within 90 days after such expiration.  This extension shall be in addition to the one-time extension for a period of 16 years as provided for in section 11 of P.L.2001, c.347 (C.52:27H-66.6).

     b.    During the 90-day period provided for in subsection a. of this section, the authority shall notify all qualified businesses in the enterprise zones extended pursuant to subsection a. of this section, that the benefits authorized by sections 16 through 20 of P.L.1983, c.303 (C.52:27H-75 through C.52:27H-79) shall be extended to qualified businesses in the enterprise zones commencing with the designation of the extended enterprise zones and continuing as long as an enterprise zone retains its designation as an extended enterprise zone.

     c.     Notwithstanding the provisions of any law, rule, or regulation to the contrary, 90 days after the expiration of the fifteenth year provided for in paragraph (3) of subsection c. of section 11 of P.L.2001, c.347 (C.52:27H-66.6), except as provided in subsection b. of section 6 of P.L.1996, c.124 (C.13:1E-116.6) and, and after first depositing 10 percent of the gross amount of all revenues received from the taxation of retail sales made by qualified businesses from business locations in enterprise zones extended pursuant to subsection a. of this section, to which this exemption shall apply, into the account created in the name of the authority in the enterprise zone assistance fund established pursuant to section 29 of P.L.1983, c.303 (C.52:27H-88), the remaining 90 percent shall be deposited immediately upon collection by the Department of the Treasury, as follows:

     (1)   In the first three-year period during which the State shall have collected reduced rate revenues within the enterprise zones extended pursuant to subsection a. of this section, those revenues shall be deposited in the enterprise zone assistance fund;

     (2)   In the second three-year period during which the State shall have collected reduced rate revenues within the enterprise zones extended pursuant to subsection a. of this section, 66 and 2/3 percent of those revenues shall be deposited in the enterprise zone assistance fund, and 33 and 1/3 percent shall be deposited in the General Fund;

     (3)   In the third three-year period during which the State shall have collected reduced rate revenues within the enterprise zones extended pursuant to subsection a. of this section, 33 and 1/3 percent of those revenues shall be deposited in the enterprise zone assistance fund, and 66 and 2/3 percent shall be deposited in the General Fund; and

     (4)   In the final year during which the State shall have collected reduced rate revenues within the enterprise zones extended pursuant to subsection a. of this section, but not to exceed the life of the enterprise zones, those revenues shall be deposited in the General Fund.

     d.    The revenues required to be deposited in the enterprise zone assistance fund pursuant to subsection c. of this section shall be used for the purposes of the assistance fund and for the uses prescribed in section 29 of P.L.1983, c.303 (C.52:27H-88), subject to annual appropriations being made for those purposes and uses.

 

     4.    This act shall take effect immediately, but shall remain inoperative until January 1, 2016.

STATEMENT

 

     This bill extends the designation of all previously designated urban enterprise zones (UEZs) for a one-time period of 10 years, thus continuing their participation in the Urban Enterprise Zone Program.  The bill specifies that the 10-year extension of these UEZs be designated within 90 days of the date of expiration of their previous designation as UEZs.  The bill authorizes qualifying retail businesses in the UEZs to charge and collect the State’s sales and use tax (SUT) at one half of the normal rate.

     The bill provides that, after dedicating 10 percent of the reduced-rate SUT revenues to the New Jersey Urban Enterprise Zone Authority: 1) during the first three-year extension period, the remaining revenues collected will be appropriated for use by the UEZs in these cities; 2) during the second three-year extension period, 66 and 2/3 percent of the remaining revenues collected will be appropriated for use by the UEZs in these cities and the remaining 33 and 1/3 percent will be deposited in the General Fund; 3) during the third three-year extension period, 33 and 1/3 percent of the remaining revenues collected will be appropriated for use by the UEZs in these cities and the remaining 66 and 2/3 percent will be deposited in the General Fund; and 4) in the final year, all remaining revenues will be deposited in the General Fund.