New Jersey Administrative Code › Title 19 - OTHER AGENCIES › NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY › Chapter 31I - BUSINESS EMPLOYMENT INCENTIVE PROGRAM › Subchapter 1 - BUSINESS EMPLOYMENT INCENTIVE PROGRAM › Section 19:31I-1.2 - Definitions

Current through Register Vol. 56, No. 14, July 15, 2024
The following words and terms, when used in this
					 subchapter, shall have the following meanings, unless the context clearly
					 indicates otherwise:
"Act" means the New Jersey Economic Development Authority
					 Act, 34:1B-1 et seq. as amended and supplemented.
"Advanced computing" means a technology used in the
					 designing and developing of computing hardware and software, including
					 innovations in designing the full spectrum of hardware from hand-held
					 calculators to super computers, and peripheral equipment.
"Advanced computing company" means a person, whose
					 headquarters or base of operations is located in New Jersey, engaged in the
					 research, development, production, or provision of advanced computing for the
					 purpose of developing or providing products or processes for specific
					 commercial or public purposes.
"Advanced materials" means materials with engineered
					 properties created through the development of specialized processing and
					 synthesis technology, including ceramics, high value-added metals, electronic
					 materials, composites, polymers, and biomaterials.
"Advanced materials company" means a person, whose
					 headquarters or base of operations is located in New Jersey, engaged in the
					 research, development, production, or provision of advanced materials for the
					 purpose of developing or providing products or processes for specific
					 commercial or public purposes.
"Authority" means the New Jersey Economic Development
					 Authority.
"Base employment number" shall mean the number of full-time
					 employees the business has employed in the State of New Jersey at the time of
					 application for the grant, including all full-time employees at entities under
					 the business's direct control, defined as 50 percent or greater ownership, and
					 excluding employees of any related affiliate(s) and parent business and
					 employees at any point-of-final purchase retail facilities.
"Base years" means the first two complete calendar years
					 following the effective date of an agreement, except that in those instances
					 where significant construction/renovation of the project requires a certificate
					 of occupancy to be awarded prior to occupancy of the project site, the base
					 years will commence upon the issuance of a certificate of occupancy by the
					 municipality.
"Biotechnology" means the continually expanding body of
					 fundamental knowledge about the functioning of biological systems from the
					 macro level to the molecular and subatomic levels, as well as novel products,
					 services, technologies and sub-technologies developed as a result of insights
					 gained from research advances which add to that body of fundamental
					 knowledge.
"Biotechnology company" means a person, whose headquarters
					 or base of operations is located in New Jersey, engaged in the research,
					 development, production, or provision of biotechnology for the purpose of
					 developing or providing products or processes for specific commercial or public
					 purposes, including, but not limited to, medical, pharmaceutical, nutritional,
					 and other health-related purposes, agricultural purposes, and environmental
					 purposes, or a person, whose headquarters or base of operations is located in
					 New Jersey, engaged in providing services or products necessary for such
					 research, development, production, or provision.
"Bonds" means bonds, notes, or other obligations issued by
					 the Authority pursuant to the Act.
"Business" means a corporation, sole proprietorship;
					 partnership, corporation that has made an election under Subchapter S
					 corporation, or any other business entity through which income flows as a
					 distributive share to its owners; limited liability company; a nonprofit
					 corporation; or any other form of business organization located within or
					 outside this State. A grant received by a partnership, Subchapter S
					 corporation, or other such business entity shall be apportioned among the
					 persons to whom the income or profit of the partnership, Subchapter S
					 corporation, or other entity is distributed, in the same proportions as those
					 in which the income or profit is distributed. Business shall also include
					 co-employers pursuant to an employer leasing agreement in accordance with
					 34:8-67 et seq., between an entity that qualifies as a business hereunder and a
					 professional employment organization; provided, however, that for purposes of
					 paying the grant, payment shall be made solely to the entity and not to the
					 professional employment organization.
"Business Employment Incentive Commitment Letter" or
					 "Commitment Letter" means the written commitment issued by the Authority which
					 sets forth the terms and conditions that must be met by the business in order
					 to receive the grant.
"Commitment duration" means 1.5 times the term of the
					 grant.
"Consumer Price Index" means the consumer price index
					 developed by the United States Bureau of Labor Statistics for Urban Wage
					 Earners and Clerical Workers using the Metropolitan Statistical Area (MSA) by
					 county as developed by the United States Census Bureau in its most recent
					 census. The MSA by county for New Jersey divides the State into northern and
					 southern areas. If the project is located in an area designated as a northern
					 county, the northern index shall be used and if the project location is in an
					 area designated as a southern county, the southern index shall be used.
"Department" means the Department of Commerce and Economic
					 Development.
"Designated industry" means a business engaged in the field
					 of biotechnology, pharmaceuticals, financial services, transportation and
					 logistics, advanced computing, advanced materials, electronic device
					 technology, environmental technology or medical device technology.
"Director" means the Director of the Division of Taxation
					 in the Department of Treasury.
"Division" means the Division of Taxation in the Department
					 of Treasury.
"Effective date" means the date of approval of the grant by
					 the Authority's governing board.
"Electronic device technology" means a technology involving
					 microelectronics, semiconductors, electronic equipment and instrumentation,
					 radio frequency, microwave and millimeter electronics, and optical and
					 optic-related electrical devices, or data and digital communications and
					 imaging devices.
"Electronic device technology company" means a person,
					 whose headquarters or base of operations is located in New Jersey, engaged in
					 the research, development, production, or provision of electronic device
					 technology for the purpose of developing or providing products or processes for
					 specific commercial or public purposes.
"Eligible partnership" means a partnership or limited
					 liability company that is qualified to receive a grant as established in the
					 Act.
"Eligible position" means a new full-time position created
					 by a business in New Jersey or transferred from another state by the business
					 during the base years or subsequent years of a grant. For grants awarded on or
					 after July 1, 2003, eligible position includes only a position for which a
					 business provides employee health benefits under a group health plan as defined
					 under section 14 of
					 P.L.
					 1997, c. 146 (17B:27-54
					 ), a health benefits plan as defined under section 1 of P.L. 1992, c.162
					 (17B:27A-17 ), or a policy or contract of health insurance covering more than
					 one person issued pursuant to Article 2 of Title 17B of the New Jersey
					 Statutes."Eligible position" also includes all current and future partners or
					 members of a partnership or limited liability company created by a business in
					 New Jersey or transferred from another state by the business pursuant to the
					 conditions set forth in the act during the base years or in subsequent years of
					 a grant. An "eligible position" shall also include a position occupied by a
					 resident of this State whose position is relocated to this State from another
					 state but who does not qualify as a "new employee" because prior to relocation
					 his or her wages or his or her distributive share of income from a gain, from a
					 loss or deduction, or his or her guaranteed payments or any combination
					 thereof, prior to relocation, were not subject to income taxes imposed by the
					 state or municipality in which the position was previously located. An
					 "eligible position" shall also include a position occupied by a resident of
					 another state whose position is relocated to this State but whose income is not
					 subject to the New Jersey gross income tax pursuant to 54A:1-1 et seq. An
					 "eligible position" shall not include any position located within New Jersey,
					 which, within a period either three months prior to the business' application
					 for a grant under the Act or six months after the date of application, ceases
					 to exist or to be located within New Jersey.
"Employment incentive" means the percentage and term of a
					 grant.
"Environmental technology" means assessment and prevention
					 of threats or damage to human health or the environment, environmental cleanup,
					 or the development of alternative energy sources.
"Environmental technology company" means a person, whose
					 headquarters or base of operations is located in New Jersey, engaged in the
					 research, development, production, or provision of environmental technology for
					 the purpose of developing or providing products or processes for specific
					 commercial or public purposes.
"Estimated tax" means an amount calculated for a partner in
					 an eligible position equal to 6.37 percent of the lesser of:
1. The amount of the partner's net income from the eligible
					 partnership that is sourced to New Jersey as reflected in Column B of the
					 partner's Schedule NJK-1 of the application year less the amount of the
					 partner's net income from the eligible partnership that is sourced to New
					 Jersey as reflected in Column B of the partner's Schedule NJK-1 in the
					 foundation year; or
2. The net of all items of partnership income upon which
					 tax has been paid as reflected on the partner's New Jersey Gross Income Tax
					 return in the application year.
"Foundation year" means the year immediately prior to the
					 creation of the eligible position.
"Full-time employee" means a person who is employed for
					 consideration for at least 35 hours a week, or who renders any other standard
					 of service generally accepted by custom or practice as full-time employment,
					 whose wages is subject to withholding as provided in the New Jersey Gross
					 Income Tax Act (54A:1-1 et seq.) or who is a partner of an eligible
					 partnership, who works for the partnership for at least 35 hours a week, or who
					 renders any other standard of service generally accepted by custom or practice
					 as full-time employment, and whose distributive share of income, gain, loss or
					 deduction, or whose guaranteed payments, or any combination thereof, is subject
					 to the payment of estimated taxes, as provided in the New Jersey Gross Income
					 Tax Act, 54A:1-1 et seq., and who is certified by the applicant to be employed
					 in a permanent position. "Full-time employee" shall not include any person who
					 works as an independent contractor or on a consulting basis for the
					 business.
"Full-time employee at the qualified business facility"
					 means a full-time employee whose primary office is at the site and who spends
					 at least 80 percent of his or her time at the site, or who spends any other
					 period of time generally accepted by custom or practice as full-time employment
					 at the site, as determined by the Authority.
"Grant" means a business employment incentive grant
					 provided by the Authority to eligible businesses based on the withholdings of
					 the New Jersey Gross Income Tax collected by that business annually resulting
					 from eligible positions for new employees.
"Medical device technology" means a technology involving
					 any medical equipment or product (other than a pharmaceutical product) that has
					 therapeutic value, diagnostic value, or both, and is regulated by the Federal
					 Food and Drug Administration.
"Medical device technology company" means a person, whose
					 headquarters or base of operations is located in New Jersey, engaged in the
					 research, development, production, or provision of medical device technology
					 for the purpose of developing or providing products or processes for specific
					 commercial or public purposes.
"Net income" means the net combination of a partner's
					 distributive share of the eligible partnership's income, gain, loss, deduction,
					 or guaranteed payments.
"Net income from the eligible partnership" means the net
					 combination of a partner's distributive share of the eligible partnership's
					 income, gain, loss, deduction, or guaranteed payments.
"New employee" means a full-time employee first employed in
					 an eligible position by a business at the project which is the subject of an
					 Agreement or who is a partner of an eligible partnership, who works for the
					 partnership for at least 35 hours a week, or who renders any other standard of
					 service generally accepted by custom or practice as full-time employment, and
					 whose distributive share of income, gain, loss, or deduction, or whose
					 guaranteed payments, or any combination thereof, is subject to the payment of
					 estimated taxes, as provided in the New Jersey Gross Income Tax Act, (54A:1-1
					 et seq.); except that such a New Jersey resident whose position is relocated to
					 this State shall not be classified as a "new employee" unless his or her wages,
					 or his or her distributive share of income from a gain, from a loss or
					 deduction, or his or her guaranteed payments or any combination thereof, prior
					 to the relocation, were subject to income taxes imposed by the State or
					 municipality in which the position was previously located. "New employee" also
					 may include an employee rehired or called back from a bona fide layoff during
					 or following the base years to a vacant position previously held by that
					 employee or to a new position established during or following the base years.
					 "New employee" shall not include: any person who was previously employed in New
					 Jersey by the business or by a related person as defined in 54:10A-5.5 if the
					 employee is transferred to the business which is the subject of an Agreement
					 unless the employee's position at his or her previous employer is filled by a
					 new employee. "New employee" shall also not include a child, grandchild,
					 parent, or spouse of an individual associated with the business who has direct
					 or indirect ownership of at least 15 percent of the profits, capital or value
					 of the business, provided, however, that "new employee shall include any person
					 who was previously co-employed in New Jersey by a professional employment
					 organization and a business if the employee is co-employed by the same
					 professional employment organization and a different business. "New employee"
					 shall also include an employee whose position is relocated to this State but
					 whose income is not subject to the New Jersey gross income tax pursuant to
					 54A:1-1 et seq. In addition, if a business receiving a grant merges,
					 consolidates, or otherwise combines with another business entity and the
					 resulting company employs former employees in eligible positions on the
					 project, then such employees shall be deemed new employees, except for any
					 employee who was employed by a business entity or entities merging, combining
					 or consolidating with the business receiving a grant who would have not
					 qualified as a new employee if the merging, combining or consolidating business
					 entity had applied for a grant.
"New employment commitment" shall mean the number of new
					 employees projected at the time of application or if this projected number has
					 not been reached by the end of the base years, the number of employees actually
					 hired at the end of the base years but in no case shall it exceed the number of
					 new employees which the business has represented at application that it will
					 employ and maintain during and throughout the commitment duration. New
					 employment commitment shall also have the meanings set forth at N.J.A.C.
					 19:31I-1.5(c) and (d).
"Non-resident New Jersey employee" means a new employee who
					 lives outside New Jersey and who is not subject to any withholding tax under
					 the laws of the State of New Jersey, such that the withholding for such
					 employee must be computed pursuant to 18:35-7.8 as the hypothetical amount of
					 withholding that would occur if the employee were to move to New Jersey.
"Partner" means a person who is entitled to either a
					 distributive share of a partnership's income, gain, loss or deduction or
					 guaranteed payments, or any combination thereof, by virtue of holding an
					 interest in the partnership. Partner also includes a person who is a member of
					 a limited liability company which is treated as a partnership, as provided in
					 the New Jersey Gross Income Tax Act, 54:1-1 et seq.
"Point-of-purchase retail facility" means a business
					 wherein the normal and customary method of patronizing the business conducted
					 at the facility requires the retail consumer to travel to the location to
					 purchase the goods or professional or consumer services of that business.
					 "Point-of-purchase retail facilities" shall not include catalog distribution
					 centers for the purposes of this program.
"Professional employment organization" means an employee
					 leasing company registered with the Department of Labor and Workforce
					 Development pursuant to 34:8-67 et seq.
"Project" means the relocation and/or expansion of a
					 business in New Jersey that is creating new employment opportunities; the wages
					 of which are subject to the provisions of the New Jersey Gross Income Tax Act
					 (N.J.S.A. 54A:1-1 et seq.).
					 Project may constitute multiple locations of a business within New Jersey, but
					 each location must meet the requirements of N.J.A.C. 19:31I-1.3.
"Residual withholdings" means for any period of time, the
					 excess of the estimated cumulative withholdings for all executed agreements
					 eligible for payments under the Act over the cumulative anticipated grant
					 amounts.
"Schedule NJK-1" means Schedule NJK-1 as the form existed
					 for taxable year 1997.
"Targeted industry" means a business engaged in the field
					 of advanced computing, advanced materials, biotechnology, electronic device
					 technology, environmental technology or medical device technology.
"Withholdings" means the amount withheld by a business from
					 the wages of new employees or estimated taxes paid by, or on behalf of,
					 partners that are new employees, or any combination thereof, pursuant to the
					 "New Jersey Gross Income Tax Act," 54A:1-1 et seq., and, if the new employee is
					 an employee whose position has moved to New Jersey but whose income is not
					 subject to the New Jersey gross income tax pursuant to 54A:1-1 et seq., the
					 amount of withholding that would occur if the employee were to move to New
					 Jersey. Withholdings shall not include amounts withheld by a business from
					 stock options, money or other payments given to a new employee pursuant to the
					 termination of employment of the new employee. Withholdings shall include
					 amounts withheld by a business from stock options, money or other payments
					 given to a new employee pursuant to a bonus for commencing employment or for
					 services rendered by the new employee.