The New Jersey Economic Development Authority (NJEDA) has begun accepting applications for the Aspire program, a place-based economic development program created under the New Jersey Economic Recovery Act of 2020 (ERA). The Aspire program supports mixed-use, transit-oriented development by providing tax credits to commercial and residential real estate development projects that have financing gaps.
“The program will help to advance new housing and commercial development projects throughout the state, with a focus on communities that have long been overlooked,” said Gov. Phil Murphy. “New Jersey’s economy is rebounding, and housing is in high-demand. Our Administration has long prioritized transit-oriented development, affordable housing, and other projects of public interest, and we will continue to do so under the Aspire program.”
“Gov. Murphy’s economic development strategy is focused on attracting investment to underserved communities and revitalizing our urban centers and places served by transit,” said NJEDA Chief Executive Officer Tim Sullivan. “With the new Aspire program, we look forward to helping to catalyze a series of mixed-use, transit-oriented, mixed-income and affordable housing projects that advance important administration economic and social goals.”
“The Aspire program applicants with affordable housing components will also be eligible for Low-Income Housing Tax Credits, which are issued by the New Jersey Housing and Mortgage Finance Agency (NJHMFA). These two programs can be leveraged to advance the state’s priorities through the development of transformative mixed-income, mixed-use projects,” said NJHMFA Executive Director Melanie R. Walter.
The Aspire program encourages mixed- use, transit-oriented development in New Jersey by providing tax credits to commercial and residential development projects that have a financing gap. The amount of tax credits a project is eligible to receive is a percentage of the project’s eligible costs, subject to a cap that is determined by the project’s location, other financing available, and other aspects of the project. Most projects are eligible for tax credits up to $42 million, but projects that meet specific criteria may receive tax credits up to $60 million. Projects that meet certain parameters can qualify as “transformative projects,” which may receive tax credits up to $350 million.
Transformative projects must have eligible costs of at least $100 million and be at least 500,000 square feet or up to 250,000 square feet for film studio projects. Transformative projects must also demonstrate special economic importance to New Jersey and leverage New Jersey’s mass transit assets, higher education assets, and other economic development assets to attract or retain employers and skilled workers.
To be eligible for Aspire program tax credits, a project must be located in an eligible incentive location, which may include: Planning Area 1, Aviation District, Port District, or Planning Area 2 or other Designated Center that is within a half mile of a rail transit station or a high frequency bus stop. Film production projects may be located anywhere in the State.
Projects must also meet minimum size and cost thresholds. Commercial projects must include at least 100,000 square feet of retail or commercial space. Residential projects must have eligible project costs totaling $5 million to $17.5 million depending on location.
In addition to meeting these baseline eligibility requirements, the developer of a project seeking Aspire program tax credits must be in substantial good standing with the New Jersey Department of Labor and Workforce Development (DOL), the New Jersey Department of Environmental Protection (DEP), and the Department of the Treasury. Projects must also comply with environmental laws (including flood hazard requirements), meet green building requirements, and pay prevailing wages to construction workers and building service workers.
The Aspire program application, as well as complete rules, eligibility requirements, award sizes, and other information, are available at https://www.njeda.com/aspire.
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