NJEDA Accepting Applications for Aspire Developmental Tax Credit Program
January 20, 2022
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 and transit-oriented development by providing tax credits to commercial and residential real estate development projects that have funding shortfalls.
“The program will help advance new housing and commercial development projects across the state, with a focus on communities that have long been neglected,” Governor Phil Murphy said. “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 benefit, and we will continue to do so through the Aspire program.
“Governor. Murphy’s economic development strategy is aimed at attracting investment to underserved communities and revitalizing our urban centers and places served by public transit,” said NJEDA Executive Director Tim Sullivan. the new Aspire program, we look forward to helping catalyze a series of mixed-use, transit-oriented, mixed-income, and affordable housing projects that advance important economic and social goals of the administration.”
“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). Both of these programs can be leveraged to advance state priorities through the development of transformative mixed-income, mixed-use projects,” said NJHMFA Executive Director Melanie R. Walter.
The Aspire program encourages mixed-use and transit-oriented development in New Jersey by providing tax credits to commercial and residential development projects that are underfunded. The amount of tax credits a project is eligible for is a percentage of eligible project costs, subject to a cap determined by the location of the project, other financing available and other aspects of the project. Most projects are eligible for tax credits of up to $42 million, but projects that meet specific criteria can receive tax credits of up to $60 million. Projects that meet certain parameters qualify as “transformative projects,” which can qualify for tax credits of 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 motion picture studio projects. Transformation projects must also demonstrate particular economic importance to New Jersey and leverage New Jersey’s 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 Zone 1, Aviation District, Port District, or Planning Zone 2 or another designated center located within half a mile of a train station or high frequency bus stop. Film production projects can 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 basic eligibility criteria, the developer of a project claiming Aspire program tax credits must be in 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 construction service workers.
The Aspire program application, along with full rules, eligibility requirements, reward sizes, and other information, can be found at https://www.njeda.com/aspire.
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