Bill, which passed Assembly, would let homeowners, developers write off 25 percent of what it costs to rehab the homes on income, corporate taxes Watch video
TRENTON — Developers and homeowners who rehabilitate historic buildings would be eligible for major tax breaks under a bill approved by the Senate Judiciary Committee today.
The bill (S659), which passed the Assembly last month, would let the homeowners and developers write off 25 percent of what it costs to rehab the homes on their income or corporate taxes. For homeowners, the credits would be limited to $25,000 for a 10-year period. Developers would have no limit.
The federal government provides a 20 percent tax credit for rehab, and 31 states have their own tax credit programs.
"Those states that have done this and have actually measured the fiscal impact ... have actually seen significant and measurable impacts on neighborhood revitalization (and) jobs creation," said state Sen. Barbara Buono (D-Middlesex), a sponsor.
The bill, which was approved 10-0, would authorize up to $130 million in credits over the next four years, and $50 million per year after that.
Buono stressed the building must be recognized as historical. "It’s not just anyone who has an old house," she said.
David Henderson, a developer who renovates old buildings in Trenton, said his company would begin work on several new projects if the credit is enacted. "I couldn’t speak more enthusiastically about this," he said. "With this credit many, many more developments could go forward."
But state Sen. Michael Doherty (R-Warren) said he suspected some would try to game the system through political connections. "I’ve seen people pitching preserving historic buildings that are 100 years old that frankly they should take a wrecking ball to," he said.
The committee also advanced several other bills that would cut businesses major tax breaks:
• A tax credit for film and television studios to shoot in New Jersey, which was suspended this year, would be increased from $10 million to $50 million, while the credit for digital media production would grow from $5 million to $10 million.
"Within weeks of this bill being passed, this is what I can assure you: there will be New Jersey jobs for New Jersey residents," said Brian O’Leary, a senior vice president at NBC/Universal.
• Limousine service companies would no longer have to charge sales tax, which currently applies only for in-state rides.
• Workers in occupations with a labor shortage in New Jersey would be able to write off portions of their students loans.
The committee also approved a bill that would allow companies to register as "benefit corporations," which can be for-profit but are intended to also provide a benefit to the community.
Andrew Kassoy, co-founder of B-Lab, which promotes the idea, said for-profit corporations usually only worry about making shareholders happy, while not-for-profits have a hard time attracting capital and talent. Benefit corporations, he said, can attract investment and turn a profit while not having to focus on simply making money for shareholders.
Previous coverage:
• Surplus of N.J. tax revenue may be byproduct of income shifting to avoid federal tax hike
• Gov. Chris Christie may propose business, income tax cuts by next month
• N.J. revenue is enough to meet budget projections, treasurer says
• N.J.'s $1.6B revenue last month meets budget projections
• N.J. Assembly committee to discuss $10.5B budget deficit
• N.J. Gov. Christie is not expected to raise taxes to close $10.5B budget shortfall
• N.J. faces $10.5B budget deficit heading into next year
• N.J. official says revenue from income tax could 'fall significantly below' budget projections