Assembly Commerce Committee Chairman Albert Coutinho told an audience of officials and professionals Tuesday that the embattled Urban Enterprise Zone program needs to be saved, and may have to go through some adjustments in order to survive.
Urban Enterprise Zones, a tool to revitalize distressed business sectors but a target of the Christie administration over concerns that the funds they generate are not being used for their intended purpose, was the subject of a panel discussion Tuesday at Thomas Edison State College.
Coutinho said that “I very much believe in the UEZ program, and its success has been well documented.”
But he told the audience that “If the governor had complete control of the Legislature, he would wipe the program out altogether.”
Mayors Jesse Tweedle Sr. of Pleasantville and Chris Bollwage of Elizabeth as well as Coutinho, (D-29), Newark, were scheduled to share their concerns with an audience of approximately 50 professionals and elected officials involved in UEZ planning.
The 28-year-old program permits some urban areas to assess a 3.5 percent sales tax with the money returning to the UEZs to fund other things such as low-interest loans to businesses.
Gov. Chris Christie suspended the program last year, and this year he has proposed ending it by the end of 2012.
Coutinho said one of the critical things UEZ supporters must do is make sure mayors and councils do not take the carrot Christie put out. The Department of Community Affairs has sent or will send a letter basically telling the towns that they can use unencumbered UEZ balances as additional municipal aid. Christie has drastically cut such aid by 75 percent, according to Coutinho.
Municipalities are feeling the stress and there is a temptation to use that money, Coutinho said. “As we fight for this now to restore funding, make sure they don’t cave in to this pressure” and use those dollars, he told the audience.
If that money is spent, and the program resumes, those towns will be essentially starting from scratch. Coutinho said his committee will hold a hearing into UEZ on May 19.
Coutinho said he is working with Legislative leadership to develop a plan to preserve the program, but he told the audience to be prepared to have the program undergo changes and adjustments so that it can go forward. “Let’s not throw the baby out with the bathwater,’’ he said.
He also pointed out that supporters must get businesses engaged. He said last year business owners wrote to legislators on behalf of the program, but this year even though he said the threat is greater, he does not see business owners writing or contacting their legislators as much.