Assembly Committee passes UEZ bill for AC as Christie vetoes returning revenues to UEZs

stateh

TRENTON — In small twist of irony not uncommon to New Jersey statehouse politics, an Assembly committee passed a bill today creating an Urban Enterprise Zone for a beleaguered Atlantic City just as Gov. Chris Christie vetoed a separate piece of legislation that would have returned millions of dollars in state sales tax revenue to such zones.

The Assembly bill (A-3920), aimed at creating jobs and spurring economic development in the embattled seaside city by designating it an UEZ, was passed along party lines this afternoon by the Assembly Commerce and Economic Development Committee. Members engaged in minor debate before releasing the bill, with the committee’s six Democrats getting behind the legislation and its three Republicans opposing it.

Assemblywoman Nancy Munoz (R-21) questioned the economic effectiveness of UEZs in the state and held out hope for a “more comprehensive” plan to save the city, currently mired in financial hardship as its casino industry continues to spiral out of control.

Committee chair and Assemblyman Gordon Johnson (D-37), however, told PolitickerNJ following the hearing that the bill is a “good first step” for a city having “major fiscal issues,” adding that having a reduced sales tax, one of the benefits of UEZs, will give residents a break.

Designated the “Atlantic City Urban Enterprise Zone and Property Tax Relief Act,” the bill authorizes the creation of an Urban Enterprise Zone in Atlantic City for a one-time term of 10 years and would allocate a significant portion of the sales and use tax collected during that time to go directly back to the city for property tax relief.

“This is a common sense step to create economic growth that will help revitalize Atlantic City by encouraging businesses to develop and create private sector jobs through public and private investment,” said Assemblyman Vince Mazzeo (D-3), the bill’s primary sponsor and sponsor of a number of similarly-geared bills meant to shore up the financially-strapped city — not to mention strengthen his political standing ahead of a potential LD3 dogfight in November.

And yet, it’s unclear how much of an impact the bill will have given another legislative development in Trenton this morning. Back from his three day junket abroad, Gov. Chris Christie returned to the statehouse today to veto a number of bills the legislature has delivered to his desk in recent months — including a bill that would have returned more than $80 million in state sales tax revenue to New Jersey’s UEZs, began under a program in 1983 to help revitalize urban communities.

In his veto message, Christie indicated that the state could not afford to lose the $82 million in revenue needed for the state’s 2016 budget.

“The changes proposed by this bill, and the impact on state resources, are best evaluated as part of the annual process,” the governor wrote. “By considering these changes through the annual budget process, I believe that important new policies concerning the UEZ program can be thoughtfully constructed.”

Committee members at today’s hearings noted that veto could all but neuter Mazzeo’s bill, preventing the state from returning revenue collected from sales tax back to the city to help finance local improvements and provide low-interest loans.

Atlantic City would be New Jersey’s 33rd Urban Enterprise Zone.

“We’ll see what happens,” Johnson said.

The second bill (A-3578) passed through committee, which was also sponsored by Mazzeo, would try to provide broader property tax relief to Atlantic County through the consolidation of school district operations.

Assembly Committee passes UEZ bill for AC as Christie vetoes returning revenues to UEZs