New Jersey A 1445: Requires certain economic incentive recipients to pay penalty for nonperformance.

Bill Text

ASSEMBLY, No. 1445

STATE OF NEW JERSEY
221st LEGISLATURE

PRE-FILED FOR INTRODUCTION IN THE 2024 SESSION

Sponsored by:
Assemblyman ROBERT J. KARABINCHAK
District 18 (Middlesex)
Assemblyman STERLEY S. STANLEY
District 18 (Middlesex)

SYNOPSIS
Requires certain economic incentive recipients to pay penalty for
nonperformance.

CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.

A1445 KARABINCHAK, STANLEY
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AN ACT requiring certain economic incentive recipients to pay a 1
penalty for nonperformance and supplementing P.L.1974, c.80 2
(C.34:1B-1 et seq.). 3
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BE IT ENACTED by the Senate and General Assembly of the State 5
of New Jersey: 6
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1. As used in P.L. , c. (C. ) (pending before the 8
Legislature as this bill): 9
“Benefit or incentive” means a financial incentive awarded by 10
the authority to a person or agreed between the authority and a 11
person under an economic incentive program administered by the 12
authority for the purpose of stimulating economic development or 13
redevelopment in New Jersey, including but not limited to a bond, 14
grant, loan, loan guarantee, matching fund, tax credit, or other tax 15
expenditure. 16
“Economic incentive program” means any program administered 17
by the authority that offers a benefit or incentive. 18
“Incentive agreement” means an agreement entered into by the 19
authority and a person to establish rights and duties of both parties 20
through which the person is entitled to receive a benefit or incentive 21
under an economic incentive program. 22
“Project” means any acquisition, construction, reconstruction, 23
repair, alteration, improvement or extension of any building, 24
structure, facility, or other improvement completed pursuant to a 25
capital investment requirement of an incentive agreement. 26
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2. a. The New Jersey Economic Development Authority, 28
pursuant to the "Administrative Procedure Act," P.L.1968, c.410 29
(C.52:14B-1 et seq.), shall, in consultation with the Department of 30
Labor and Workforce Development, the Office of the State 31
Comptroller, and the Division of Taxation in the Department of the 32
Treasury, adopt rules and regulations to establish minimum 33
standards for the administration of economic incentive programs to 34
verify whether each benefit or incentive recipient has performed to 35
all requirements under any applicable economic incentive program 36
or incentive agreement. 37
b. For an award of a benefit or incentive made after the 38
effective date of P.L. , c. (C. ) (pending before the 39
Legislature as this bill), the authority shall annually determine 40
whether each benefit or incentive recipient has performed to all 41
requirements under any applicable economic incentive program or 42
incentive agreement. The authority shall notify the Director of the 43
Division of Taxation in the Department of the Treasury of each 44
benefit or incentive recipient that has not performed to a 45
requirement under an applicable economic incentive program or 46
incentive agreement, as determined by the authority. 47

A1445 KARABINCHAK, STANLEY
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c. A benefit or incentive recipient that has not performed to a 1
requirement under an applicable economic incentive program or 2
incentive agreement shall, as a penalty for nonperformance, pay to 3
the Treasurer of the State of New Jersey, for deposit in the General 4
Fund, an amount equal to the product of: 1) the applicable tax rate 5
for the recipient in the privilege period or taxable year in which the 6
authority has made a determination of nonperformance; multiplied 7
by 2) the total value of the respective benefit or incentive received 8
up to that privilege period or taxable year. 9
d. The value of a benefit or incentive included in a previous 10
calculation of a penalty shall not be included in the calculation of a 11
penalty for a subsequent determination of nonperformance. 12
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3. a. The rules and regulations adopted by the authority 14
pursuant to section 2 of P.L. , c. (C. ) (pending before the 15
Legislature as this bill), shall not diminish the existing contractual 16
rights of a benefit or incentive recipient under an incentive 17
agreement that is in effect as of the effective date of P.L. , 18
c. (C. ) (pending before the Legislature as this bill). 19
b. The authority shall not apply the rules and regulations 20
adopted by the authority pursuant to section 2 P.L. , c. (C. ) 21
(pending before the Legislature as this bill), in a manner that 22
diminishes the existing contractual rights of a benefit or incentive 23
recipient under an incentive agreement that is in effect as of the 24
effective date of P.L. , c. (C. ) (pending before the 25
Legislature as this bill). 26
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4. This act shall take effect 90 days after enactment but the 28
authority may take administrative actions in advance to effectuate 29
the purposes of this act. 30
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STATEMENT 33
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This bill requires that a recipient of a New Jersey Economic 35
Development Authority (