Legislative Update 7/12/10
Monday, 12 July 2010
July 9, 2010 -
Tracking Legislation and Other Items Important to the NJ Business Community
PROPERTY TAX REFORM CAP 2.0 – S-29 (Sweeney/D-3; McKeon/D-27; Barnes/D-18): Senate passed 36 to 3. Reduces school district, county and municipal property tax levy caps from 4% to 2% and permits unused school district, county and municipal increases to be banked for three succeeding years. The State Chamber believes reigning costs at the local level, coupled with the other components of the Governor’s “Tool Kit," will begin to address the systemic problems of New Jersey's property tax system. Contact: Michael Egenton
STATE BUDGET Fiscal 2011 State Budget – S-3000 (Bucco/R-25; O’Toole/R-40; Malone/R-30; O’Scanlon/R-12): Senate passed 21-19. Assembly passed 41-37. Governor signed into law. The $29.4 billion state budget does not include new or increased broad-based taxes and instead relies on spending reductions to balance the budget. The spending plan closes a $10.7 billion shortfall for the new fiscal year that begins July 1. The budget does not renew the income tax rate increase enacted last year on those who make more than $400,000. That increase was seen as a small-business tax hike since S-corporations, LLCs, partnerships and sole proprietorships pay taxes based on their owners’ personal income. It would have discouraged business owners from creating and retaining jobs or expanding their investments in New Jersey. Additionally, the 4 percent surtax on the Corporation Business Tax (CBT) will be allowed to expire at the end of the fiscal year. It was originally slated to expire at the end of fiscal 2009. Funding for several business incentive programs has been reduced or eliminated, however, the final budget does not contain a provision initially included that increases business filing fees. Contact: Mary Ellen Peppard
Below are companion budget bills: A-3011 - (Wolfe/R-10; Bramnick/R-21): Assembly passed 41-37. Senate passed 21-19. Governor signed into law. Temporarily reduces the cap from $60 million to $30 million on tax credits available for the high-tech tax credit transfer program. Suspends the film and digital media tax credit program.
S-2097 - (Kyrillos/R-13; Bucco/R-25; DiCicco/R-4): Senate passed 21-16. Assembly passed 41-37. Governor signed into law. Redirects up to $22 million from the InvestNJ program to the Main Street Program, which encourages New Jersey banks to lend to small and medium-sized businesses by providing credit and financing assistance. The year-old InvestNJ program provided grants to companies that hired new workers and offered tax breaks to companies that made capital investments.
A-3005 - (Coyle/R-16; Schroeder/R-390): Assembly passed 41-37. Senate passed 21-18. Governor signed into law. Increases the special purpose assessment paid by insurance companies. These additional revenues, along with the premium tax that is currently paid by insurers, will fund the operations of the Department of Banking and Insurance.
A-3003 - (Malone/R-30): Assembly passed 41-35-2. Senate passed 21-17. Governor signed into law. Removes the cap on the .53% assessment imposed on a hospital’s operating revenue and raises the cap on the gross receipts assessment on certain ambulatory care facilities to generate additional state funds and maximize federal matching funds for charity care.
A-3014 - (DeCroce/R-26; Rible/R-11): Assembly passed 64-14. Senate passed 25-10. Governor signed into law. Changes the point of collection of the motor fuel tax to streamline the process and save on administrative and compliance expenses
Averting Payroll Tax Increase - S-1813 (Madden/D-4; Sweeney/D-3; Egan/D-17; Albano/D-1; Evans/D-35; DeAngelo/D-14): Senate passed 33-4 to concur with Governor’s recommendations following conditional veto. Assembly passed 70-2-6 to concur with Governor’s recommendations. Governor signed into law. Prevents the full automatic Unemployment Insurance (UI) tax increase from taking effect, thereby limiting the average increase to $130 per employee. This law also limits the benefits available to employees who are terminated for cause and prohibits employees fired for severe misconduct from collecting benefits. Additionally, this law creates an Unemployment Insurance Fund Task Force to assess the condition of the fund and make recommendations to restore the UI Fund to solvency. Contact: Michael Egenton
Unemployment Insurance – S-1968 (Buono/D-18; Madden/D-4; Greenstein/D-14; DeAngelo/D-14): Senate passed 40-0 and sent to Governor. Revises certain unemployment benefit claim procedures and requires the registration of authorized agents with the New Jersey Department of Labor and Workforce Development. These changes would result in an increased cost to both businesses and the state for administration of the UI system, which is already in financial trouble. Ultimately, these costs will be passed on to businesses, which already face an undue burden caused by mismanagement of the UI fund. Contact: Michael Egenton
Monmouth Economic Revitalization Authority Act – S-917 (Lesniak/D-20; Beck/R-12; Cryan/D-20; Coutinho/D-29; Fuentes/D-5; Quijano/D-20; O’Scanlon/R-12): Senate passed 39-0. Assembly passed 76-1-1and sent to Governor. Establishes the Monmouth Economic Revitalization Authority as the successor to the Fort Monmouth Economic Revitalization Planning Authority, which was federally designated to develop a comprehensive revitalization plan for the Fort Monmouth area. This new authority will implement a coordinated conversion and redevelopment plan for the Fort Monmouth area that will benefit the municipalities that encompass the area as well as the state. Contact: Mary Ellen Peppard
Interdistrict Public School Choice Program – A-355 (Jasey/D-27; Voss/D-38; Moriarty/D-4): Senate passed 39-0. Assembly passed 78-0 and sent to Governor. Creates a permanent interdistrict public school choice program. A five-year pilot program was established in 2000 and expired in 2005. Like the pilot, the permanent program would allow students to enroll across district lines in designated schools within a district. The permanent program doesn’t limit the number of districts that can participate in the choice program. Contact: Michael Egenton
Streamlining Government – S-2099 (O’Toole/R-40; Oroho/R-24; DeCroce/R-26; Bramnick/R-21): Senate passed 21-19. Assembly passed 78-0. Governor signed into law. Consolidates the functions and powers of the Office of the Inspector General and the Office of the Medicaid Inspector General under the Office of the State Comptroller. Employees of the Office of the Inspector General and the Office of the Medicaid Inspector General who are employed on the date this bill takes effect, and determined by the State Comptroller to be necessary to carry out the duties of the Office of the State Comptroller, will be continued and transferred to the Office of the State Comptroller. Contact: Michael Egenton
Fair Debt Collection Practices Act – A-1700 (Burzichelli/D-3; Milam/D-1; DeAngelo/D-14; Moriarty/D-4; Vandervalk/R-39): Assembly passed 55-22. Creates guidelines under which debt collectors may conduct business; defines rights of consumers involved with debt collectors; and prescribes penalties and remedies for violations of the bill. The State Chamber recognizes that the Attorney General’s Office does not have the ability to handle additional consumer issues with the resources they now have and suggests that the bill mirror the federal Fair Debt Collection Practices Act. Contact: Michael Egenton
Communication Exemption For Truckers – S-1429 (Madden/D-4; Girgenti/D-35): Senate passed 38-0. Assembly passed 77-0. Governor signed into law. Exempts the use of a CB radio or a two-way radio by operators of commercial motor or authorized emergency vehicles from the current ban on using cell phones or other mobile communications devices while driving. Contact: Michael Egenton
*Information provided by the NJ State Chamber of Commerce