BUSINESS & ECONOMY

Bill Would Give Sales Tax Revenue to Urban Enterprise Zones

By Candace Kelley
Correspondent

“This is an area that was a blighted area. It was abandoned warehouses, it was landfills,” said Assembly Speaker Vincent Prieto.

But now shoppers pack the Walmart and BJ’s at the Walmart Shopping Center in North Bergen. Prieto says these shoppers wouldn’t have a place to go if it wasn’t for the Urban Enterprise Zone project. And now he’s sponsoring a bill that would give back a portion of sales tax revenue to municipalities with Urban Enterprise Zones. The monies were taken away in the 2011 state budget.

This morning 12 mayors from various cities including Jersey City, Newark, Paterson and Elizabeth gathered to support the legislation.

“When you look at unemployment rate in the state of New Jersey and you wonder why it’s so high, you can correlate that with Urban Enterprise Zone dollars that have been taken away,” said Elizabeth Mayor Chris Bollwage.

If the bill is passed, it would mean that $27 million would go to the Urban Enterprise Zone Loan Program. But those monies would only be spent on certain approved measures.

Assemblyman Prieto says the $27 million is actually just 30 percent of what was originally taken away from municipalities, so he says the bill is a good compromise.

But past criticism of the Urban Enterprise Zones is that cities have used the money from the program to pay for things other than businesses, including salaries and benefits. But Assemblyman Prieto says municipalities will have to justify their spending with the Department of Community affairs. And he says the Urban Enterprise Zone Sales Tax Revenue Restoration Bill provides specific guidelines to make certain the money is spent properly on things including police, business support and landscaping.

“It’s about our economy. You have to invest in it. And again, it’s only a portion of what was normally going to the UEZ’s,” Prieto said.

These mayors say they have been able to transform shopping areas thanks to the Urban Enterprise Zone program, through benefits like reducing sales tax to 3.5 percent for participating businesses and providing access to low interest loans. Now they say they want to do all they can to keep businesses in these areas and that takes money.

“If you think about Jersey City overall over the past two decades, it’s really been an example of urban revitalization, and that is in no small part because of the UEZ,” said Mayor Steven Fulop.

The Assembly speaker says he plans to introduce the bill within the next week and has aggressive plans to get it to the governor’s desk by the holidays. He says it’s a priority for municipalities in the state to get back the millions that once belonged to them.