Summary#
A-5709 would amend New Jersey’s Cultural Arts Incentives Program law, P.L.2023, c.197; it would not create a separate program. Its goal is to let certain large convention centers qualify for projects that may receive program tax credits.
- A convention center would meet the new definition only if it has at least 400,000 square feet used for conventions or similar events and is in a municipality subject to the Municipal Stabilization and Recovery Act on the bill’s effective date. The bill’s statement identifies the Atlantic City Convention Center as an example.
- A qualifying facility would still need an eligible cultural arts institution as applicant. A project must involve at least $5 million in capital investment, and the New Jersey Economic Development Authority (EDA) must award credits under the program’s scoring and other requirements. Eligibility would not guarantee an award.
- The EDA would have to review applications on a rolling basis. The bill removes its current option, described in the text, to switch to a competitive application process when demand is likely to exceed available credits.
- The EDA chief executive officer must adopt any rules the officer deems necessary to carry out the bill. Those rules may take effect when filed, for up to 365 days, before they must be amended, adopted or readopted under the usual rulemaking process.
What it means for you#
- Convention centers and applicants: A qualifying center could be included among facilities for which an eligible cultural arts institution seeks tax credits. The bill does not require a center to apply or guarantee that a project will receive credits.
- Cultural arts institutions: Applications would be reviewed on a rolling basis, but the program’s minimum score, project requirements and other award conditions still apply.
- The public: The bill does not directly change taxes paid by individuals, create a public service, or require a convention center to be built or improved.
Money#
No cost information is in the available material.
- The bill could make qualifying convention-center projects eligible to seek tax credits under the existing program; it does not state a new tax-credit allocation or estimate the value of credits that may be awarded.
- The EDA would have to review applications on a rolling basis and its chief executive officer would have to adopt necessary rules. The bill gives no estimate of staffing or administrative costs.
What is unclear#
- The parent Act is not supplied, so the bill’s description of current law and the exact changes against the law now in force could not be independently verified.
- The bill does not set out how the EDA would decide when to review an application or how rolling review would work in practice.
- It does not say how many convention centers or projects might qualify, or how many credits would be available when applications compete for limited credits.
- The bill is introduced and is not law. It would take effect immediately if enacted, but passage is uncertain.
Case for#
- A possible argument for the bill is that it would allow a large convention center in a municipality under state financial restrictions to seek tax-credit support for a major capital project.
- Rolling review may let the EDA assess applications as they come in, rather than switching to a single competitive process when demand is expected to be high.
- The program’s scoring, minimum-score rule and existing project requirements would still apply to applicants.
Case against#
- One concern is that tax credits could be awarded to a convention-center project without the bill stating how much public revenue might be forgone.
- The bill removes the EDA’s option to use a competitive application process when demand may exceed available credits. It does not explain how timing and limited credit availability would affect applicants under rolling review.
- The bill does not guarantee that a qualifying project would improve local conditions or produce particular economic results.