by Hoboken Strategy Group
For many of us, Fall means “Back to School.” Around the halls of Trenton it means “Back to Work!” The Legislature has returned from their summer recess with a number issues of importance to Hudson County Chamber of Commerce members. This Fall is shaping up to be an active one for the Legislature with committee hearings and voting sessions scheduled through the end of the year.
The looming Transportation Trust Fund (TTF) reauthorization will be a hot-button issue in Trenton through the coming months. As an update to our last edition, the Assembly Transportation & Independent Authorities Committee has started holding public hearings on the issue. On September 18, Governor Chris Christie named former DOT Commissioner Jamie Fox as his choice to be the department’s next commissioner. Fox has been lauded as a problem solver who can work with all parties to come up with a fair solution.
Taxes, the least popular word in the English language, has become a prime issue amongst the Christie administration and the Legislature. In recent years, our state has initiated numerous pro-business tax reform measures with the intent of becoming more business friendly. The corporate business tax structure has been reformed to allow companies to carry forward net operating losses, a reduction in the minimum tax on S-Corporations, changing to a single sales tax factor, and phasing out the Transitional Energy Facility Assessment (TEFA). However, there is still work to be done.
The Legislature is expected to consider a bill to phase out New Jersey’s estate tax. While the federal threshold of taxation is $5 million, New Jersey imposes estate and inheritance taxes on estates exceeding $675,000 in value. This is in comparison to states such as Florida which does not have an estate tax. The estate tax only generates 2% of state revenues. Proponents of this legislation believe that the loss in revenues will be exceeded by the increase the State will realize as a result of a greater number of citizens remaining in New Jersey to live and spend money.
Shop Local, we have all heard it. As the holidays approach, we will continue to hear it from mayors and local small business owners. Towns across the state have implemented shop local programs in towns such as Marlboro, Voorhees, West Orange, Glassboro, Highland Park and here in Hudson County-Bayonne. These programs reward shoppers who shop locally with each purchase at a participating store earning credits with a total amount printed on property tax bills. For example, Marlboro had approximately 50 local businesses participating last year with total sales of $1.1 million attributed to the program as well as 3,341 participating families saving $64,000 collectively. The issue is that current law restricts what a municipality may print on a property tax bill. A strict interpretation of the law could invalidate this program if it were to be challenged in court. As a result, Assemblyman Ron Dancer (R-12) has introduced A-2249 which permits municipalities to authorize property tax reward programs and validates the actions of municipalities that have created them. Assemblyman Dancer has called this legislation a “win-win” for local businesses and property taxpayers.
This Summer, the Legislature approved a resolution to place a question on the November ballot that could increase the dedicated portion of the Corporation Business Tax (CBT) from 4 to 6 percent. While this ballot question does not increase the amount of taxes paid by businesses, it would divert funding from general purposes to open space purposes. Supporters of the ballot question stress the need for funds to rebuild following Hurricane Sandy. The ballot question would dedicate this portion of the CBT towards purchasing and maintaining open space throughout the state. Opponents of the referendum focus their argument on New Jersey’s current business tax climate. According to the Tax Foundation, a nonprofit policy and research organization, New Jersey ranked 49th worst in business tax climate in 2013.
The Legislature is also expected to consider legislation to require New Jersey employers to provide paid sick leave to their workers. Currently only Newark, Jersey City and Passaic have adopted paid leave policies and New Jersey would be only the second state in the nation to enact a paid sick leave requirement if the bill is approved by the Legislature and signed into law by Governor Christie. Under the legislation, S-785/A-2354, each employer would be required to provide earned sick leave to each employee that it employs in the State. Workers would accrue one hour of paid sick leave for every 30 hours worked. In the Assembly, Speaker Vincent Prieto (D-32) has expressed his support for the legislation stressing his belief that “earned sick leave means stronger families, stronger workplaces and stronger communities.” Opponents of the legislation, including the New Jersey Business and Industry Association, believe that the measure would represent an expensive but unfunded state mandate.
The action is heating up in Trenton as these and other issues advance. It is never a dull day “From the Halls of Trenton!”
Hoboken Strategy Group is a boutique New Jersey government relations and business development firm made up of public affairs professionals with years of experience handling legislative and regulatory issues on the local, state and federal levels. Kay Elizabeth LiCausi, President of Hoboken Strategy Group, serves on the Government Affairs Committee for the Hudson County Chamber of Commerce. Michael J. Comba serves as Vice President of Hoboken Strategy Group. They can be reached online at www.hobokenstrategy.com and on Facebook at Hoboken Strategy Group.
Hudson County Chamber of Commerce 