New Jersey lawmakers want to give more tax credits to businesses that agree to move to areas around the state's colleges and universities.
The bill was first introduced in 2005 and has been reintroduced every session since. On Thursday, it was approved by the Assembly. Since the Senate passed it last week, it now goes to Gov. Christie's desk.
It would create "innovation zones" in areas around campuses, giving tax incentives to companies that move there. Advisory boards would decide what types of industry to support in each zone.
"This was something that I thought would help in terms of serving as a magnet to attract more businesses, particularly those high-tech and research companies," said State Sen. Shirley K. Turner (D., Mercer), who sponsored the bill. "I think we're going to have another Silicon Valley before it's all over - I hope, anyway."
The idea came from an executive order signed by Gov. James E. McGreevey in September 2004. It would have created areas around Camden, Newark, and New Brunswick where the Economic Development Authority would "give bonuses or other enhanced incentives to businesses that locate in innovation zones."
McGreevey resigned two months later, and nothing happened with the innovation zones, Turner said.
Now, the innovation zones would still be centered on the "Greater Camden," "Greater Newark," and "Greater New Brunswick" regions - one for each region of the state. The Greater Camden region, for example, includes not only the city but Rowan University's home of Glassboro and Stockton University's home in Galloway.
"It's watered down," Turner said, because lawmakers asked for their own districts to be included. The danger of that move, she said, was that "it loses its real effect when everybody is considered part of an innovation zone."
Using tax incentives to persuade companies to move has also been criticized, especially as state programs grant millions of dollars in breaks to companies relocating to Camden, sometimes from as close as Cherry Hill.
"They're there with the intention, for many reasons, for the tax incentives that it brings to them, but it doesn't always utilize the resources that are all around them," said Pamela R. Lampitt (D., Camden), an assemblywoman sponsoring the bill.
The difference with the innovation zones is the creation of the advisory boards to ensure that the right businesses move to the areas, Lampitt said, and that they work with the colleges and universities for research, internships, and other partnerships.
Tax incentives would help move businesses, but the boards have to make sure the businesses actually work with the schools.
"We're not creating pathways, we're not creating internships, we're not utilizing the physical resources of some of our universities the way that we should, so that's why the innovation zone creates a multi-layer kind of approach," Lampitt said.
"We've got these great minds, these great youths, this great energy, they're being educated, but they don't have the internships, they don't have the doors open to them."
Turner, who has criticized existing programs used to attract companies to Camden, said she was more focused on bringing smaller companies to work with schools, unlike some of the large corporations - Subaru, Lockheed Martin, Holtec - that are moving to Camden.
"That's one of the concerns that I have with our tax incentives as they exist now, is we're not doing enough to provide those tax incentives to those smaller companies that would be involved in research and high technology," Turner said.
The College of New Jersey, in Turner's district, would benefit from having companies around as it opens a new science, technology, engineering, and math building, she said.
Rowan is also hoping to benefit from the legislation, said Steven Weinstein, executive vice president for policy and external partnerships.
"This gives us the opportunity, and another tool, to be able to attract development. For us, it will mean a lot for our [South Jersey Technology Park] and west campus," Weinstein said.
Weinstein said the university has been interested in the bill because it "equalizes the available tax credits" for Rutgers, Rowan, and the New Jersey Institute of Technology.
As Rowan is working on partnerships with multiple companies, especially on the research side, Weinstein said, the innovation zone credits could help them close the deal.
"It's not automatic, but it increases the opportunity for tax credits," Weinstein said. "For a company that may be looking at our tech park, they may be looking at one in other places in the state that have the level of tax credits that, if we didn't get the bill, we wouldn't have. So we would be at a potential disadvantage."
Some business assistance programs could be modified if the bill becomes law, expanding them in the innovation zones.
"We need every tool we can get to try to bring them," Weinstein said. "So that's a great opportunity for us as well as the other research institutions."