N.J. Opens Applications For Offshore Wind Tax Credit Program

0

Companies making a capital investment in offshore wind-related facilities in the seven southern counties of New Jersey can now apply for tax credits through the state’s Offshore Wind Tax Credit Program, the New Jersey Economic Development Authority (NJEDA) announced today.

According to NJEDA, the Offshore Wind Tax Credit is a financial tool designed to spur private capital investment and employment growth in major land-based projects related to offshore wind. It provides reimbursement for eligible capital investments in industry-specific facilities located in the seven southern counties.

“The new Offshore Wind Tax Credit Program is a fiscally responsible and targeted incentive that will help accelerate private-sector investment into offshore wind infrastructure and manufacturing here in New Jersey,” says Brian Sabina, senior vice president at NJEDA’s office of economic transformation.


Under the program, businesses may qualify for tax credits of up to 100% of capital investments made in a qualified wind facility, but the tax credit amount may be limited by a net positive economic benefits test, which uses the project’s estimated tax revenues to ensure the state will receive a return greater than the value of the credit. Approved entities may elect to apply 10% of the total credit amount per year over a 10-year period against their corporation business or insurance premiums tax or sell the credit for at least 75% of its value. This program is capped at $100 million.

To qualify for the tax credits, businesses must make a capital investment of at least $50 million in a qualified wind energy facility within Burlington, Camden, Gloucester, Salem, Cumberland, Mercer or Cape May counties. Businesses leasing space at a qualified wind facility may also apply for the tax credit but will still be required to demonstrate $50 million in capital investment in the wind facility – at least $17.5 million of which is the responsibility of the prospective tenant applicant.

In addition to the capital investment requirement, businesses must also create at least 300 new full-time jobs, which may include supply-chain jobs – such as manufacturers, suppliers and installers – associated with the qualified wind energy facility. Supply-chain positions will count toward the new job requirement only if employees spend at least 80% of their time in New Jersey.

NJEDA maintains the ability to reduce or revoke tax credits if businesses in the program fail to maintain facility and employment levels for the required term.

Businesses must apply for the Offshore Wind Tax Credit Program by July 1, 2024, and satisfy the capital investment and employment conditions for award of the credits by July 1, 2027. More information can be found here.

Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments