New Jersey Administrative Code › Title 19 - OTHER AGENCIES › NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY › Chapter 31S - OFFSHORE WIND ECONOMIC DEVELOPMENT TAX CREDIT PROGRAM › Subchapter 1 - OFFSHORE WIND ECONOMIC DEVELOPMENT TAX CREDIT PROGRAM › Section 19:31S-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 Offshore Wind Economic Development Act,
					 P.L.
					 2010, c. 57, as
					 amended.
"Affiliate" means an entity that directly or indirectly
					 controls, is under common control with, or is controlled by the business, and
					 may include not-for-profit entities. Control exists in all cases in which the
					 entity is a member of a controlled group of corporations as defined pursuant to
					 Section 1563 of the Internal Revenue Code
					 of 1986 ( 26 U.S.C. § 1563 ) or the entity is an organization in a group
					 of organizations under common control as defined pursuant to subsection (b) or
					 (c) of section 414 of the Internal Revenue Code
					 of 1986 ( 26 U.S.C. § 414 ). A taxpayer may establish by clear and
					 convincing evidence, as determined by the Director of the Division of Taxation
					 in the Department of the Treasury, that control exists in situations involving
					 lesser percentages of ownership than required by those statutes. An affiliate
					 of a business may contribute to meeting either the qualified investment or
					 full-time employee requirements of a business that applies for a credit under
					 this Program.
"Approval letter" means the letter sent by the Authority
					 that sets forth the conditions to maintain the approval and to receive the tax
					 credit, the forecasted schedule for completion and occupancy of the project,
					 the date the eligibility period is scheduled to commence, the estimated amount
					 of tax credits, the process by which affiliates contributing employment or
					 capital investment may be added, the requirement for the project site to remain
					 a qualified wind energy facility, events that would trigger reduction and
					 forfeiture of tax credits, tax clearance certificate requirements, and other
					 such information that furthers the purposes of the Program. The letter also
					 requires the applicant to permit audit(s) from time to time, as the Authority
					 deems necessary, of the business's payroll records and any other evidence and
					 documentation supporting the certifications pursuant to
					 N.J.A.C.
					 19:31-20.7(f)  and the
					 annual reports pursuant to
					 N.J.A.C.
					 19:31-20.14. The approval letter will require
					 the applicant to submit progress information by a certain date in order to
					 preserve the approval of the tax credits.
"Authority" means the New Jersey Economic Development
					 Authority.
"Board" means the Board of the New Jersey Economic
					 Development Authority.
"Business" means a corporation that is subject to the tax
					 imposed pursuant to section 5 of P.L. 1945, c. 162 (N.J.S.A.
					 54:10A-5), a corporation that is subject to
					 the tax imposed pursuant to sections 2 and 3 of P.L. 1945, c. 132
					 (N.J.S.A.
					 54:18A-2 and
					 54:18A-3), section 1 of P.L. 1950,
					 c. 231 (N.J.S.A. 17:32-15) or
					 N.J.S.A.
					 17B:23-5, or is a partnership, an S
					 corporation, or a limited liability corporation. A business shall include an
					 affiliate of the business if that business applies for a credit based upon any
					 capital investment made by the affiliate or full-time employees of an
					 affiliate.
"Capital investment" in a qualified wind energy facility
					 means expenses incurred for the site preparation and construction, repair,
					 renovation, improvement, equipping, or furnishing of a building, structure,
					 facility, or improvement to real property, including associated soft costs,
					 provided soft costs shall not exceed 20 percent of all capital investment.
					 Capital investment includes obtaining and installing furnishings and machinery,
					 apparatus, or equipment for the operation of a business in a building,
					 structure, facility, or improvement to real property, site-related utility and
					 transportation infrastructure improvements, plantings, or other environmental
					 components required to attain the level of silver rating or above in the
					 LEED(R) building rating system, but only to the extent that such capital
					 investments have not received any grant financial assistance from any other
					 State funding source, including N.J.S.A. 52:27H-80et seq. (The United States
					 Green Building Council has developed the Leadership in Energy &
					 Environmental Design (LEED) Green Building Rating System for measuring the
					 energy efficiency and environmental sustainability of buildings. The LEED
					 Rating System is a third-party certification program and the nationally
					 accepted benchmark for the design, construction, and operation of
					 high-performance buildings.) Vehicles and heavy equipment not permanently
					 located in the building, structure, facility, or improvement shall not
					 constitute a capital investment. Also included is remediation of the qualified
					 wind energy facility site, but only to the extent that such remediation has not
					 received financial assistance from any other Federal, State, or local funding
					 source. To be included, the capital investment must be commenced after August
					 19, 2010, the effective date of the Act. For purposes of this subchapter,
					 "commenced" shall mean that the project consisting of construction of a new
					 building shall not have progressed beyond site preparation; the project
					 consisting of acquisition of an existing building shall not have closed title;
					 and the project consisting of renovation or reconstruction of an existing
					 building shall not have commenced construction.
"Complex of buildings" means buildings that are part of
					 the same financing plan and operational plan.
"Developer" means, with respect to a qualified wind energy
					 facility, a business that intends to construct and lease a wind energy
					 facility. A developer may seek to receive approval that the facility will
					 constitute a qualified wind energy facility conditioned upon identification of
					 tenants that will have qualifying employment and pro form as indicating that
					 the capital investment requirements will be met.
"Eligibility period" means the five-year period in which a
					 business may claim an offshore wind economic development tax credit, beginning
					 with the tax period in which the Authority accepts the certification of the
					 business that it has met the capital investment and employment qualifications
					 of the Program.
"Equipment supply coordination agreement" means an
					 agreement between a business and an equipment manufacturer, supplier,
					 installer, or operator that supports a qualified offshore wind project, or
					 other wind energy project as determined by the Authority, and that indicates
					 the number of new, full-time jobs to be created by the agreement participants
					 towards the employment requirement as set forth in
					 N.J.A.C.
					 19:31-20.3. "Equipment supply coordination
					 agreement" shall not include subcontracts or agreements between the equipment
					 manufacturer, supplier, installer, and operator and parties other than the
					 business that has applied for a credit under this Program..
"Full-time employee" means a person employed by the
					 business 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, as determined by the Authority, or a person who is employed by a
					 professional employer organization pursuant to an employee leasing agreement
					 between the business and the professional employer organization, in accordance
					 with P.L.
					 2001, c. 260 (N.J.S.A.
					 34:8-67et seq.), 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, as determined by the Authority, and whose wages are subject to
					 withholding as provided in the New Jersey Gross Income Tax Act, N.J.S.A.
					 54A:1-1et seq. A full-time employee is also a partner of a business 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 determined by
					 the Authority 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, N.J.S.A. 54A:1-1et seq. "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" shall not include an
					 employee who is a resident of another state and whose income is not subject to
					 the New Jersey Gross Income Tax Act, N.J.S.A. 54A:1-1et seq., unless that state
					 has entered into a reciprocity agreement with the State of New Jersey.
"Full-time employee at the qualified wind energy 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 facility, or who spends any other
					 period of time generally accepted by custom or practice as full-time employment
					 in New Jersey, as determined by the Authority.
"Leasable area" means rentable area of the building as
					 calculated pursuant to the measuring standards of the project. This standard
					 will be defined in the lease for tenant applicants. The rentable area measures
					 the tenant's pro rata portion of the entire office floor, including public
					 corridors, restrooms, janitor closets, utility closets, and machine rooms used
					 in common with other tenants, but excluding elements of the building that
					 penetrate through the floor to areas below. The rentable area of a floor is
					 fixed for the life of a building and is not affected by changes in corridor
					 sizes or configuration.
"Letter of compliance" means the letter issued annually by
					 the Authority pursuant to
					 N.J.A.C.
					 19:31-20.14(e)  that must
					 accompany the use of the tax credit certificate.
"Minimum number of new full-time employees" means:
1. For the first year, at least a cumulative 100 new
					 full-time employees compared to the number of full-time employees at the time
					 of application;
2. For a privilege period or taxable year following the
					 first year, at least a cumulative 150 new full-time employees compared to the
					 number of full-time employees at the time of application;
3. For a privilege period or taxable year following the
					 second year, at least a cumulative 200 new full-time employees compared to the
					 number of full-time employees at the time of application; and
4. For the fourth and fifth privilege period or taxable
					 year following the third and fourth year, respectively, at least a cumulative
					 300 new full-time employees compared to the number of full-time employees at
					 the time of application.
"Net leasable area" means the usable area or actual
					 occupiable area of a building, a floor, or an office suite. The amount of
					 usable area can vary over the life of a building as corridors expand and
					 contract and as floors are remodeled, and, thus, is not fixed for the life of a
					 building as would be the case with leasable area.
"New full-time employee" means a position that did not
					 previously exist in this State and that is created by the business and filled
					 by a full-time employee at the qualified wind energy facility. A new full-time
					 employee may also include new full-time employee resulting from an equipment
					 supply coordination agreement, provided that the employee spends at least 80
					 percent of his or her time in New Jersey, or any other period of time in New
					 Jersey generally accepted by custom or practice as full-time employment, as
					 determined by the Authority. New full-time employee resulting from an equipment
					 supply coordination agreement may include, but not be limited to, employees
					 that have been hired by way of a labor union hiring hall or its equivalent.
					 With regard to new full-time employees resulting from an equipment supply
					 coordination agreement, one "new full-time employee" means 35 hours of
					 employment per week dedicated to the work required under the agreement, or who
					 renders any other standard of service generally accepted by custom or practice
					 as determined by the Authority as full-time employment, regardless of whether
					 or not the hours of work were performed by one or more persons. New full-time
					 position shall also include new full-time positions that a business creates
					 after receipt of approval, pursuant to
					 N.J.A.C.
					 19:31-20.7, that are transferred to the
					 qualified wind energy facility upon completion thereof and meet the
					 requirements of this Program.
"Offshore wind economic development tax credit" means the
					 tax credit permitted under section 6 of the Act, which may be applied against
					 the tax liability otherwise due for corporation business tax or insurance
					 premiums tax pursuant to section 5 of P.L. 1945, c. 162 (N.J.S.A.
					 54:10A-5), sections 2 and 3 of P.L. 1945, c.
					 132 (N.J.S.A. 54:18A-2 and
					 54:18A-3), section 1 of P.L. 1950,
					 c. 231 (N.J.S.A. 17:32-15), or
					 N.J.S.A.
					 17B:23-5.
"Partnership" means an entity classified as a partnership
					 for Federal income tax purposes.
"Professional employer organization" means an employee
					 leasing company registered with the Department of Labor and Workforce
					 Development pursuant to
					 P.L.
					 2001, c. 260 (N.J.S.A.
					 34:8-67et seq.).
"Program" means the Offshore Wind Economic Development Tax
					 Credit Program created pursuant to section 6 of the Act and provided in this
					 subchapter.
"Progress information" means the information that must be
					 submitted pursuant to
					 N.J.A.C.
					 19:31-20.7(e).
"Project" means the employment and the capital investment
					 in a qualified wind energy facility that is at least the employment and capital
					 investment required by the Program.
"Prorated minimum number of new full-time employees" means
					 the minimum number of new full-time employees pursuant to
					 N.J.A.C.
					 19:31-20.9(a)  for a
					 business receiving a prorated award.
"Prorated annual minimum number of new full-time employees"
					 means for projects approved with less than 300 new full-time employees:
1. For the first year, at least a cumulative 100 new
					 full-time employees compared to the number of full-time employees at the time
					 of application;
2. For a privilege period or taxable year following the
					 first year, at least a cumulative 150 new full-time employees compared to the
					 number of full-time employees at the time of application;
3. For a privilege period or taxable year following the
					 second year, the lesser of 200 and the applicable prorated minimum number of
					 new full-time employees, compared to the number of full-time employees at the
					 time of application; and
4. For the fourth and fifth privilege period or taxable
					 year following the third year and fourth year, respectively, the applicable
					 prorated minimum number of new full-time employees compared to the number of
					 full-time employees at the time of application.
"Qualified offshore wind project" means the same as the
					 term is defined in
					 section
					 3 of
					 P.L.
					 1999, c. 23
					 (N.J.S.A.
					 48:3-51), which is a wind turbine electricity
					 generation facility in the Atlantic Ocean and connected to the electric
					 transmission system in this State, and includes the associated
					 transmission-related interconnection facilities and equipment, and approved by
					 the New Jersey Board of Public Utilities, or any successor entity, pursuant to
					 section
					 3 of
					 P.L.
					 2010, c. 57
					 (N.J.S.A.
					 48:3-87.1).
"Qualified wind energy facility" means any building,
					 complex of buildings, or structural components of buildings, including water
					 access infrastructure, and all machinery and equipment used in the
					 manufacturing, assembly, development, or administration of component parts that
					 is primarily used to support the development and operation of a qualified
					 offshore wind project, or other wind energy project as determined by the
					 Authority. To the extent a qualified wind energy facility requires improvements
					 to existing non-wind facilities, only the improvements shall be part of the
					 qualified wind energy facility.
"Soft costs" means all costs associated with financing,
					 design, engineering, legal, or real estate commissions, including, but not
					 limited to, architect fees, permit fees, loan origination and closing costs,
					 construction management, and freight and shipping delivery, but not including
					 early lease termination costs, air fare, mileage, tolls, gas, meals, packing
					 material, marketing, temporary signage, incentive consultant fees, Authority
					 fees, loan interest payments, escrows, or other similar costs.
"Tenant" means a business that is a lessee in a qualified
					 wind energy facility.