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Urban Enterprise Renewal Not Dead Yet

Phil Gregory

Urban enterprise zones that allow businesses to charge a reduced sales tax expired in five New Jersey cities on December 31st, but legislation to renew them for two years isn't dead yet.

Governor Christie has until the end of the month to decide whether to sign the measure that would allow the UEZ’s in Newark, Camden, Trenton, Bridgeton, and Plainfield to continue and make the tax reduction retroactive to January 1st.

Michael Darcy, the executive director of the New Jersey League of Municipalities, says the uncertainty is tough on businesses located in those zones.

"They have to decide whether it may be more advantageous to relocate outside of the zone to an area that offers different benefits for their business. If these businesses do relocate, it then imposes a greater tax burden on other businesses and residents within the community as a whole."

Darcy is hoping the governor will sign the legislation.

“These are communities that have been designated in need of this special assistance. We think that they need to continue to receive that special urban enterprise designation, and if it needs to change and modernize that’s fine. But let’s figure out how to do that and keep these zones active while we’re figure out how to do that.”

Christie previously questioned the effectiveness of the state’s entire urban enterprise zone program and wants to look into whether something different is needed to help financially distressed communities.