Prieto, Mazzeo, Pintor Marin, Quijano & Schaer Bill to Boost Urban Enterprise Zones to Create Jobs & Economic Development Advanced by Assembly Panel

(TRENTON) – Legislation Assembly Democrats Speaker Vincent Prieto, Vince Mazzeo, Eliana Pintor Marin, Annette Quijano and Gary Schaer sponsored to restore a portion of sales tax revenue to municipalities with Urban Enterprise Zones to spur urban economic development and create jobs was released Monday by an Assembly panel.
The bill (A-3952) requires that, as of July 1, 30 percent of the reduced rate sales tax revenues collected by qualified businesses in urban enterprise zones (UEZs) will be deposited to the accounts held in the Enterprise Zone Assistance Fund in the name of the respective municipalities having UEZs. The remaining 70 percent of those revenues are to be deposited in the state’s general fund.
The sponsors said the change will help urban areas compete for shoppers, attract new businesses and prosper economically.
“The Urban Enterprise Zone initiative is one of our state’s most powerful economic drivers and this legislation would be a strong step toward once again revving the program up and helping our urban areas be more competitive,” said Prieto (D-Hudson/Bergen), who represents UEZ communities Guttenberg, Kearny, North Bergen and West New York. “”Our urban areas cannot succeed economically if we do not provide the proper investments into them, and the UEZ program is the single best way we can help these cities and their residents and businesses prosper.””
“This is all about creating jobs and economic growth,” said Mazzeo (D-Atlantic), who represents UEZ municipality Pleasantville and has proposed adding Atlantic City to the program. “This bill would put new life into these programs, and that can only mean good things for the businesses that create sorely needed jobs in these communities.”
“The UEZ program fosters a positive economic climate that revitalizes urban communities by encouraging businesses to create private sector jobs through public and private investment,” said Pintor Marin (D-Essex), who represents UEZ municipality Newark. “But we can do more to make it successful, and this bill accomplishes that goal to everyone’s benefit.”
“The UEZ program is a proven winner, but we can make it better,” said Quijano (D-Union), who represent UEZ municipalities Elizabeth, Hillside and Roselle. “With these simple, common sense changes, we’ll be doing more to boost economic development and create jobs in the places that need it most.”
“This bill will make a significant difference when it comes to bringing economic development and jobs to areas that need the boost,” said Schaer (D-Bergen/Passaic), who represents UEZ community Passaic. “With just this simple change, we’ll be doing a lot to create jobs and boost economic growth in communities throughout New Jersey.”
Created in the early 1980s, the UEZ program reduces sales tax in participating businesses within the state’s 37 zones to 3.5 percent while also including several incentives designed to promote hiring and investment in urban communities.
Originally the program also sent sales tax revenue back to the municipalities to pay for needed services such as police presence and public works, as well as marketing, promotional and support services for businesses and other beneficial items. However, that aspect of the program was removed in the 2011 state budget, leaving only the reduced sales tax.
This bill would restore roughly one third of the original sales tax revenue to the municipalities – a total of $27 million in direct state investment in the UEZ program – while also preserving the 3.5 percent sales tax rate.
The bill includes safeguards to ensure that the sales tax revenue is spent only on approved measures, and municipalities would have to justify expenditures to the Department of Community Affairs. The funding would provide direct property tax relief to these municipalities by funding items such as police presence in UEZs and landscaping and maintenance costs to beautify shopping areas, making them more attractive to consumers.
The bill was released by the Assembly Budget Committee chaired by Schaer.