$500 Million Next New Jersey Manufacturing Program Opens Applications for New Tax Credit

The Next New Jersey Manufacturing Program Act, a bipartisan bill signed into lawin August by New Jersey Governor Phil Murphy, has created a tax credit initiative designed to attract wide capital investment, high-quality manufacturing jobs that lead to careers and solidified clean-energy supply chains as permanent fixtures in the New Jersey economy.

The bill(A5687/S4407) requires the New Jersey Economic Development Authority (NJEDA) to administer the program, which will befunded by $500 millionintax credits. The maximumaward amount will be $150 millionper eligible applicant, with no minimumawardamount, and it can award up to 25% of a project's total capital investment.

When reviewing applications, NJEDA will considerthe number of new jobs created (minimum 20), wherethe jobs are primarily located(80% in-state), and prevailing wage requirements.Successful projects will have a contractual agreement with at least one NJ-based partner investing at least $10 million atan eligible participant facility. Examples include a public/private college or high school, workforce development organization, vocational/technical school, labor organization, employer association, or nonprofit that provides training/apprenticeships.

NJEDA opened applications last week on September 25th, and applications will remain open until the funds are fully committed. Priority industries include:

• Energy/clean energy:components for offshore wind, energy storage, and electrification equipment that can help companies in the energy supply chain locateor scale in New Jersey.
• Construction and equipment manufacturers:large projects requiring significant capital investment and construction activity, such asnew facilities and expansions, will generate demand for construction trades, materials suppliers, and equipment manufacturers.
• Agriculture: although the program excludes primary agriculture operations, non-retail food andbeverage manufacturers are eligible. These investments will strengthen the local agricultural processing and supply chains, increasing demand for processing and productionequipment.

NJEDAis accepting applications through its mainportal (https://www.njeda.gov/nextnjai/),and applicants are encouraged to complete required forms and submitthe documentation listed with a detailed capital budget, job projections, wage schedules, evidence of the required collaborative relationship, environmental and labor compliance documentation, and a project timeline. The link provided abovealso includes a sample packet that can be used to help streamlineand clarifythe process.

According to the New JerseyDepartment of Labor, 10,000 manufacturing establishmentsare currently locatedin the state, employing roughly 236,000 workers, addan estimated $50-$54 billionto New Jersey'sGDP. The Next New Jersey Manufacturing program builds directly on this strengthand could serve as model legislation for other states looking to attract manufacturing jobs.

To learn more about state-level incentives in other states or to get involved in AEM's advocacy efforts, please reach out to the AEM Advocacy Team at [email protected].