New Jersey Administrative Code › Title 19 - OTHER AGENCIES › NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY › Chapter 31U - EMERGE › Subchapter 1 - EMERGE › Section 19:31U-1.3 - Eligibility criteria

Current through Register Vol. 56, No. 14, July 15, 2024
(a) A
				  business eligible pursuant to this section may submit an application to the
				  Authority in accordance with the provisions of section 72 at
				  P.L.
				  2020, c. 156 and
				  N.J.A.C. 19:31U-1.5 on or after May 20, 2021, the effective date of this
				  subchapter, but prior to March 1, 2027.
(b) The Authority shall make the
				  determination that an applicant has met the criteria for eligibility for a tax
				  award and shall determine the amount of the award. In order for a business to
				  be eligible for tax credits under the program, the chief executive officer of
				  the business or an equivalent officer shall demonstrate to the Authority at the
				  time of application that:
1. The business
				  will make, acquire, or lease a capital investment at the qualified business
				  facility equal to or greater than the applicable amount set forth at (c)
				  below;
2. The business will create
				  or retain new and retained full-time jobs in the State in an amount equal to or
				  greater than the applicable minimum number of new or retained full-time jobs
				  required to be eligible as set forth at (d) below. To qualify as an eligible
				  position or full-time job, the business must demonstrate to the Authority's
				  satisfaction that the employee spends at least 80 percent of the individual's
				  work time in this State and that the eligible position requires an employee to
				  have the individual's primary place of work in this State;
3. The qualified business facility is located
				  in a qualified incentive area;
4.
				  The award of tax credits will be a material factor in the business's decision
				  to create or retain the number of new and retained full-time jobs set forth in
				  its application, except that:
i. The award of
				  tax credits shall not be considered a material factor in the creation or
				  retention of full-time jobs filled by employees providing professional
				  services, as defined at
				  N.J.S.A.
				  14A:17-3(1), and their
				  direct administrative support staff, unless as of the date of the business's
				  application, the full-time job is filled by an employee whose primary business
				  office is located outside of the State. Direct administrative support staff
				  shall not include employees in information technology, human resources, or
				  employee relations positions; and
ii. In determining whether a position
				  provides professional services subject to (b)4i above, the Authority shall
				  consider several factors, including, but not limited to, whether the business
				  is a small business or whether the preponderance of its customer base is
				  located within this State;
5. The award of tax credits, the capital
				  investment resultant from the award of tax credits, and the resultant creation
				  and retention of new and retained full-time jobs will yield a net positive
				  economic benefit, as calculated by the Authority, to the State equaling at
				  least 400 percent of the requested tax credit allocation amount except as
				  listed at (b)5i and ii below. For a phased project, the requested tax credit
				  allocation amount for the initial phase shall equal at least 400 percent of the
				  requested tax credit allocation amount except as listed at (b)5i and ii below,
				  and, for each phase thereafter, the cumulative net positive economic benefit
				  shall equal at least 400 percent of the requested tax credit allocation amount
				  except as listed at (b)5i and ii below. The net positive economic benefit
				  determination shall be calculated prior to considering the value of the
				  requested tax credit under the program and shall be based on the benefits
				  generated during the period of time from approval through the end of the
				  commitment period. The net positive economic benefit may be based on the
				  benefits generated through the end of the longer period of extended commitment
				  that the business may elect for purposes of receiving credit for benefits
				  projected to occur after the expiration of the commitment period, pursuant to
				  (b)5iv below.
i. An award of tax credits to a
				  business for a qualified business facility located in a distressed municipality
				  or an enhanced area shall yield a net economic positive benefit to the State,
				  based on the benefits generated during the period of time from approval through
				  the end of the commitment period, that equals at least 300 percent of the
				  requested tax credit amount.
ii. An
				  award of tax credits to a business for a qualified business facility located in
				  a government-restricted municipality, or for a mega project, shall yield a net
				  positive economic benefit to the State, based on the benefits generated during
				  the period of time from approval through the end of the commitment period, that
				  equals at least 200 percent of the requested tax credit amount.
iii. The net positive economic benefits
				  calculated for all projects shall be evaluated by the Authority on a present
				  value basis with the requested tax credit allocation amount discounted to
				  present value at the same discount rate as the benefits from capital investment
				  resultant from the award of tax credits and the resultant retention and
				  creation of full-time jobs as provided at (b)5iv below.
iv. A business may elect a period of extended
				  commitment beyond the commitment period for which time the economic benefits
				  shall be creditable by the Authority to the determination of the net positive
				  economic benefit of the project. In no event, shall the period for which the
				  net positive economic benefit be determined, including any extended commitment
				  period, exceed 20 years. A business electing a period of extended commitment
				  and failing to maintain the project through the expiration of that extended
				  commitment period shall be obligated to repay a proportion of the incremental
				  benefits received on account of having extended the commitment period, taking
				  into consideration the number of years of extended commitment during which the
				  business maintained the project.
v.
				  If, during the term of the program, the methodology used by the Authority in
				  projecting the net positive economic benefits of a project in making the
				  determination required pursuant to this paragraph is modified, the Authority
				  may adjust, prospectively, the respective percentage thresholds by which the
				  benefits must exceed the requested tax credit allocation amount set forth
				  pursuant to this paragraph to ensure consistent application of the respective
				  percentage thresholds. Any modification to the methodology shall be applied
				  prospectively. Prospective application means using the modified methodology or
				  respective percentages to pending applications and to projects that have been
				  previously approved if the business requests a modification, or this subchapter
				  or the commitment agreement requires or authorizes the Authority to conduct a
				  reevaluation of the net positive economic benefit;
6. The qualified business facility shall be
				  in compliance with minimum environmental and sustainability standards upon
				  completion of the project;
7. The
				  project shall comply with the Authority's affirmative action requirements,
				  adopted pursuant to section 4 at P.L. 1979, c. 303 (N.J.S.A.
				  34:1B-5.4) and N.J.A.C. 19:30-3;
				  and
8. Each worker employed to
				  perform construction work or building services work at the qualified business
				  facility shall be paid not less than the prevailing wage rate for the worker's
				  craft or trade, as determined by the Commissioner of the Department of Labor
				  and Workforce Development pursuant to P.L. 1963, c. 150 (N.J.S.A 34:11-56.25 et
				  seq.) and P.L. 2005, c.
				  379 (N.J.S.A. 34:11-56.58
				  et seq.).
i. The payment of prevailing wage
				  pursuant to this paragraph shall not apply if:
(1) The work performed under the contract is
				  performed at a qualified business facility owned by a landlord that is not a
				  business receiving Authority assistance;
(2) The landlord is a party to the
				  construction contract, building services contract, or both; and
(3) The qualified business facility
				  constitutes a lease of less than 35 percent of the entire facility at the time
				  of contract and under any agreement to subsequently lease the qualified
				  business facility.
ii.
				  In accordance with section 1 at P.L. 1979, c. 303 (N.J.S.A.
				  34:1B-5.1), nothing in this paragraph shall
				  be construed as requiring the payment of prevailing wage for construction
				  commencing more than two years after the Authority has issued the first
				  certificate of compliance pursuant to paragraph (2) of subsection a. of section
				  77 at P.L.
				  2020, c. 156 and
				  N.J.A.C. 19:31U-1.10(d).
iii. The
				  payment of prevailing wages for building services work shall apply for the
				  duration of the commitment period.