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Dec. 16, 2008 - Tracking Legislation Important to the New Jersey Business Community

The members of the legislature will not be in session for the rest of the year. They will return on Jan. 13 for the Governor’s State of the State address.


UEZ Sales Tax Exemptions for Small Business – A-2720 (Vas/D-19; Burzichelli/D-3; Pou/D-35; Evans/D-35; Stack/D-33; Turner/D-15): Assembly passed 70-5, Senate passed 36-0, sent to the Governor. Expands the number of businesses who qualify for sales tax free purchases within an Urban Enterprise Zone (UEZ) at the point of purchase. This bill would allow businesses with annual gross receipts of less than $10 million (up from $3 million) to obtain a sales tax exemption at the time of purchase. Currently those businesses are required to pay sales tax and submit receipts to the state for a tax refund.

New Main Street Program – A-3377 (Schaer/D-36; Fisher/D-3; Spencer/D-29; Conners/D-7; Watson Coleman/D-15; Pou/D-35) Senate passed 37-3, Assembly passed 59-17, Governor signed into law on Dec. 16. Appropriates $50 million to the NJ Economic Development Authority to provide guarantees and loans to small and mid-sized businesses and not-for-profit corporations on an expedited basis to stimulate the economy.

Senate Budget and Appropriations Committee

Expanding the Urban Transit Hub Credit – S-2379 (Cunningham/D-31; Ruiz/D-29): Committee passed. Expands the eligibility and clarifies certain provisions of the Urban Transit Hub Tax Credit Program, which provides tax credits of up to 100 percent of qualified capital investments made in an urban transit hub. The bill lowers the capital investment threshold from $75 million to $50 million, revises forfeiture requirements, allows the tax credits to be carried forward for 20 years, and allows unused credits to be sold.


Senate Budget and Appropriations Committee

Authorizing Grants for Energy Programs and Projects – A-2507/S-1932 (Chivukula/D-17; Ruiz/D-29; Gordon/D-38): Committee passed. Authorizes the state Board of Public Utilities to use revenue from the Retail Margin Fund to provide grants for the development of combined heat and power, energy efficiency and demand response projects by non-residential customers with high levels of peak energy load usage. This legislation will assist large energy users with their energy costs.

Senate Economic Growth and Senate Environment Committees

Formula Based Rates for Utilities – S-2428 (Lesniak/D-20): Committee received testimony only. This bill authorizes electric or gas public utilities to implement formula based rates. This legislation is designed to start the discussion in regards to bringing predictability to the rate setting process and to stabilize rates. The State Chamber supports efforts that will result in additional capital expenditures for New Jersey and the jobs that spending will create, but we are concerned about statements made during the hearing that this bill will increase energy costs for the employer community. The State Legislature should explore any and all opportunities to ease the credit crisis and increase private sector capital spending.

Testimony Before the Senate Economic Growth Committee and the Senate Environment Committee

NJ Global Warming Emissions Plan Released – The Corzine Administration yesterday unveiled a draft of their Global Warming Response Act Recommendation Report. Through a combination of the Energy Master Plan and the Regional Greenhouse Gas Initiative (RGGI), the plan highlights additional measures the state will need to implement in order to reach the 2020 goal of reducing greenhouse gas emissions to 1990 levels. The plan is not final – it is being put forth for public review and comment. There will be six stakeholder input meetings scheduled for early January covering areas such as industry, green buildings, agriculture, transportation, and land use.


Senate Budget and Appropriations Committee Incentives For Nursing Faculty – S-626 (Vitale/D-19; Buono/D-18): Committee passed. Proposes a loan forgiveness program that will allow recent graduates of approved masters or doctoral programs who have been hired to be faculty in accredited nursing schools in New Jersey to have a portion of their loans forgiven. The exact amount of the loan forgiveness program will be determined within the regulations. This program will serve as a marketing tool for New Jersey's schools of nursing to recruit potential faculty hires to pursue a career as a nurse faculty member at their institution.

Hearing Aid Mandate – S-467 (Buono/D-18; Lance/R-23; Roberts/D-5; Conaway/D-7): Assembly passed 72-3, sent to the Governor. Requires health insurers to cover the cost of hearing aids for individuals 15 years of age and younger. Continuing to mandate benefits severely restricts the ability of insurance companies to control costs, which in turn increases health insurance premiums for employers.


Protecting the UI Fund – SCR-60 (Sweeney/D-3; Kean, T./R-21): Senate passed 38-0. Proposes an amendment to the New Jersey Constitution that prohibits the state from collecting contributions from employers or employees by means of assessment on wages for any purpose other than to provide employee benefits. The State Chamber believes that this concurrent resolution will assist both employers and employees by keeping our Unemployment Insurance Trust Fund (UI) and Temporary Disability Insurance Benefit Fund (TDI) and various workers’ compensation funds solvent.

Worker Compensation Reform – S-1918 (Sarlo/D-36; Madden/D-4; Egan/D-17; Cohen/D-20; Giblin/D-34; Barnes/D-18): Assembly passed 77-0, sent to Governor. Authorizes the Insurance Fraud Prosecutor to investigate, and if warranted, prosecute, cases of failure to provide workers’ compensation insurance coverage. Amendments to the bill stipulate that this may only occur after the employer has been given a reasonable opportunity to obtain that coverage. This bill is part of a package that implements steps towards reforming the state’s worker compensation system.


Corporate Business Tax Reform – A-2722 (Vas/D-19; Greenwald/D-6; Coutinho/D-29): Assembly passed 77-0, sent to Governor. Repeals two CBT provisions, the “throwout” rule and the “regular place of business” requirement. The throwout rule requires a New Jersey company, when calculating its corporate business tax liability, to include income earned in another state if that state chooses not to tax or is unable to tax the income. New Jersey is one of only two states that utilize this onerous provision. The regular place of business provision requires a multi-state corporation to maintain an office with at least one employee outside the state in order to allocate its income on the same basis as corporations with multiple business locations. New Jersey is the only state with this requirement. Our business tax policies impact the way that our state is perceived in the national and global marketplace. Reforming our business tax climate is vital to retaining and attracting businesses. (This is an initiative recommended in the Chamber Corporate Business Tax Package.)

Senate Budget and Appropriations Committee

Streamlining Tax Collection – A-3111/S-1418 (Greenwald/D-6; Pou/D-35; Chivukula/D-17): Committee passed, Senate passed 23-15, sent to Governor. Revises the State’s sales and use tax to conform with various provisions of the multi-state Streamlined Sales and Use Tax Agreement (SSUTA). The bill incorporates technical and substantive changes, including changes to telecommunications definitions, which have been adopted by the Streamlined Sales Tax Governing Board since New Jersey first entered the agreement in 2005. The changes are intended to simplify and modernize the state’s tax collection and administrative procedures, and to ensure New Jersey remains compliant with the provisions of the SSUTA.

Improving NJ’s Corporate Governance Laws – A-2883 (DeAngelo/D-14; Chivukula/D-17; Coutinho/D-29; Diegnan/D-18; Vas/D-19; Watson Coleman/D-15; Lampitt/D-6); A-2881 (Vas/D-19; Coutinho/D-29; Diegnan/D-18; Watson Coleman/D-15; Lampitt/D-6): Senate passed both bills 37-0, sent to Governor. These bills are designed to update New Jersey's corporate governance laws to make it easier for corporations to conduct business in our state. Many of the legislative changes proposed are modeled on Delaware General Corporation Law.