Some on the Fence Over NJ Tax Credits
The credits are awarded under the urban transit tax creditâ€”first passed in 2007 and broadened in 2009â€”and instituted to spark development in struggling central business districts. To qualify, property owners have to make at least $50 million worth of capital investments in a facility within a half-mile of a rail station, in one of nine cities, and support 250 full-time employees.
Beneficiaries include Panasonic with a $102 million subsidy awarded from its move from Secaucus to Newark and the Gateway Transit Village, where New Brunswick Development and Pennrose Properties are building a $150 million mixed-use residential center. Condos will start at $250,000 and go up to $440,000, according to Christopher Paladino, president of Devco. Rentals will go for $1,400 to $2,800 per month.
â€śThese nine cities are distressed,â€ť says Tim Lizura, senior vice president at the Authority. â€śThis program was designed to turn the tide and create a mechanism to allow corporations to invest in central business districts.â€ť
The EDA claims the initiative will prove its value as it helps the stateâ€™s central business districts recover from years of neglect and the recent downturn. However, some question the authorityâ€™s power to grant the tax credits and others have voiced concern over using so much taxpayer money to subsidize the relocation of a global powerhouse company like Panasonic.