Bill Text: NJ A3890 | 2020-2021 | Regular Session | Introduced


Bill Title: Requires annual reporting related to economic development and redevelopment activities in federal opportunity zones.

Spectrum: Partisan Bill (Democrat 3-0)

Status: (Introduced - Dead) 2020-03-23 - Introduced, Referred to Assembly Commerce and Economic Development Committee [A3890 Detail]

Download: New_Jersey-2020-A3890-Introduced.html

ASSEMBLY, No. 3890

STATE OF NEW JERSEY

219th LEGISLATURE

 

INTRODUCED MARCH 23, 2020

 


 

Sponsored by:

Assemblywoman  VERLINA REYNOLDS-JACKSON

District 15 (Hunterdon and Mercer)

Assemblyman  WILLIAM W. SPEARMAN

District 5 (Camden and Gloucester)

Assemblyman  GORDON M. JOHNSON

District 37 (Bergen)

 

 

 

 

SYNOPSIS

     Requires annual reporting related to economic development and redevelopment activities in federal opportunity zones.

 

CURRENT VERSION OF TEXT

     As introduced.

  


An Act requiring annual reporting related to economic development and redevelopment activities in federal opportunity zones, and supplementing P.L.1974, c.80 (C.34:1B-1 et seq.).

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    As used in P.L.    , c.    (C.        ) (pending before the Legislature as this bill):

     "Authority" means the New Jersey Economic Development Authority established pursuant to P.L.1974, c.80 (C.34:1B-1 et seq.);

     "Division" means the Division of Taxation in the Department of the Treasury.

     "Federal opportunity zone" means a federal census tract that has been designated as a qualified opportunity zone pursuant to 26 U.S.C. s.1400Z-1.

     "Economic development incentive" means a financial incentive, awarded by the New Jersey Economic Development Authority to a person or entity, or agreed by the authority and a person or entity, for the purpose of stimulating economic development or redevelopment in a federal opportunity zone in New Jersey, including, but not limited to, a bond, grant, loan, loan guarantee, matching fund, tax credit, tax deduction, tax abatement, or other tax expenditure.

     "Qualified opportunity fund" means an investment vehicle that meets the requirements of a qualified opportunity fund pursuant to 26 U.S.C. s.1400Z-2.

 

     2.    a.  Beginning the year next following the year in which P.L.    , c.   (C.        ) (pending before the Legislature as this bill) takes effect and annually thereafter, the New Jersey Economic Development Authority shall, in consultation with the Department of Community Affairs, the Department of Labor and Workforce Development, and the Department of the Treasury, prepare a report on the economic development and redevelopment activities taking place in each of the 169 designated federal opportunity zones that are located in this State, and submit the report to the Governor, and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature.  Each report required pursuant to this section shall include information related to racial demographics, employment, homeownership, affordable housing, minority-owned businesses, minority entrepreneurship, gentrification, sustainability, and economic development in each federal opportunity zone in this State.  Each report required pursuant to this section shall also include economic development and tax revenue information, including returns on investment, lost federal and State tax revenue, and deferred federal and State tax revenue, pertaining to persons or entities receiving both State economic development incentives and federal tax benefits by operation of 26 U.S.C. s.1400Z-1 and 26 U.S.C. s.1400Z-2.  The authority shall submit a final report, pursuant to this section, to the Governor, and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature, in the year after the authority determines that qualified opportunity funds are to no longer receive federal tax benefits by operation of 26 U.S.C. s.1400Z-1 and 26 U.S.C. s.1400Z-2.

     b.    Notwithstanding any provision of law, rule, or regulation to the contrary, the authority shall not, on or after the effective date of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), issue or approve the award of an economic development incentive to any person or entity for economic development or redevelopment activities to occur in a federal opportunity zone, unless the person or entity has entered into an economic development incentive agreement with the authority that requires the person or entity to regularly:

     (1)   disclose the source of all capital investments by any person or entity in the project receiving an economic development incentive, and whether any capital investment in the project has been or is to be made by a qualified opportunity fund;

     (2)   disclose the cumulative amount of capital committed by qualified opportunity fund investors into the project relative to the overall capital investments in the project, along with information on the management of any qualified opportunity fund making a capital investment in the project;

     (3)   disclose information related to performance-based earnings and carried interest, related to a project receiving an economic development incentive and information, if applicable, on the total number of jobs created or retained by the project, the average wages paid for jobs created or retained by the project, information related to housing affordability and demographics for any residential component of the project, and any other metrics the authority determines are relevant; and

     (4)   provide any other information necessary for the authority to carry out the purposes of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), as determined by the authority.

     c.     The division, the Department of Community Affairs, and the Department of Labor and Workforce Development shall provide the authority with the information or documents that the authority requests concerning a tax incentive agreement entered into pursuant to subsection b. of this section.

     d.    The authority, in consultation with the division, the Department of Community Affairs, and the Department of Labor and Workforce Development, shall adopt rules and regulations in accordance with the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) as are necessary to implement P.L.    , c.    (C.        ) (pending before the Legislature as this bill).

     3.    This act shall take effect on the first day of the fourth month next following the date of enactment and shall apply to all applicable tax incentives approved or issued on or after the effective date.

 

 

STATEMENT

 

     This bill requires the New Jersey Economic Development Authority (EDA) to prepare annual reports on the economic development and redevelopment activities taking place in each of the 169 designated federal opportunity zones located in New Jersey.  The federal opportunity zone law, 26 U.S.C. s.1400Z-1 and 26 U.S.C. s.1400Z-2., encourages investors to direct past capital gains into qualified funds that invest in opportunity zones in exchange for the reduction or elimination of certain tax liability for those invested capital gains. 

     The EDA is to consult with the Department of Community Affairs, the Department of Labor and Workforce Development, and the Department of the Treasury in preparation of the report, and submit the reports to the Governor and the Legislature.  Each report is required to include information related to racial demographics, employment, homeownership, affordable housing, minority-owned businesses, minority entrepreneurship, gentrification, sustainability, and economic development in each federal opportunity zone in this State.  Each report is also required to include economic development and tax revenue information, including returns on investment, lost federal and State tax revenue, and deferred federal and State tax revenue, pertaining to persons or entities receiving both State economic development incentives and federal tax benefits by operation of qualified opportunity fund tax treatment. 

     The bill also prohibits the EDA from issuing or approving the award of an economic development incentives to any person or entity for economic development or redevelopment activities in federal opportunity zones, unless the person or entity has entered into an economic development incentive agreement with the authority that requires the person or entity to disclose certain information to aid the EDA in preparation of the reports required by the bill.

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