BROWNFIELDS REDEVELOPMENT INCENTIVE PROGRAM (Amended as of 9/4/24)
Revisions to this program were signed into law on 9/4/24. New rules to implement the revised program are pending. The new application will be posted here, after the rules are issued. The program is not currently accepting applications. Sign up at bftaxcredit@njeda.gov for updates.
The Brownfields Redevelopment Incentive Program is a $50 million per year project-based tax credit. The program provides a one-time transferrable tax credit to incentivize environmental remediation, abatement, and demolition activities that will allow for the redevelopment of brownfields sites for commercial, retail, or mixed-use development or expansion.
ELIGIBILITY
The Brownfields Redevelopment Incentive Program covers specific costs associated with brownfield remediation. Eligible costs include those associated with investigation and remediation of environmental contamination and building and structural remedial activities.
Tax credits will be awarded through a rolling application process.
To receive tax credits through the Brownfields Redevelopment Incentive Program, a project must meet the following criteria:
- Be a brownfield.
- Receive a letter of support from the governing body.
- Demonstrate the project is not economically feasible without the tax credit award.
- Comply with prevailing wage requirements, including:
- Construction prevailing wage for all remediation and construction work at the project site until the later of the completion of the redevelopment project or two years after the tax credit is issued.
- Building services prevailing wage for 10 years after the redevelopment project is completed.
- The Developer (or their affiliates) must not have started remediation activities (beyond environmental assessment and investigation), except in two cases:
- If remediation was ordered by a government official with jurisdiction over the site, or certified by a Licensed Site Remediation Professional (LSRP) to correct or prevent the spread of a health, safety, or other hazard.
- If the applicant certifies that they could not reasonably have known the full extent of contamination before beginning cleanup efforts.
- Demonstrate that remediation costs are reasonable and appropriate.
- Be in good standing with NJ Department of Environmental Protection, NJ Department of Labor and Workforce Development, and NJ Department of the Treasury.
- Have a developer equity contribution of a minimum of 20% of total cost of remediation (10% in Government Restricted Municipalities and Qualified Incentive Tracts).
- Have site access to perform the remediation.
- Meet Green Remediation/Green Building Standards.
- For projects over $5 million that are not located in Atlantic City, Paterson, or Trenton, the applicant must demonstrate a project financing gap.
- Projects located in Atlantic City, Paterson, or Trenton, as well as projects under $5 million, are not required to meet this criterion.
Additional notes on eligibility:
- Cannabis Businesses are not eligible.
- The redevelopment project can be a remediation-only project.
- Parties that have discharged a hazardous substance or otherwise caused or contributed to site contamination are not eligible for the program.
- Projects that received a reimbursement through the former Brownfield Contaminated Site Reimbursement Program are not eligible.
Please be advised: New Jersey State law prohibits most cannabis license and certification holders from receiving or continuing to receive an economic incentive from the NJEDA. If the applicant, or any person who controls the applicant or owns or controls more than one percent of the stock of the applicant, has applied for or received a license or a certification from the New Jersey Cannabis Regulatory Commission (NJ-CRC), the applicant is ineligible for this program and should not proceed with an application. If an application is received from an applicant that meets these criteria, the application will be declined, and the application fee will not be refunded.
AWARD SIZE
The Brownfields Redevelopment Incentive Program provides a one-time tax credit issued in the year remediation is completed. The awards are sized based on the remediation costs (eligible costs) and project location.
- For projects which include erecting a solar panel array on a closed sanitary landfill:
- 100 percent of remediation costs up to a maximum award of $12 million, if the project is located in a Government-Restricted Municipality (GRM) or Qualified Incentive Tract (QIT)
- 100 precent of remediation costs up to maximum award of $8 million if the project is located elsewhere in New Jersey
- For other brownfield projects:
- 80 percent of remediation costs up to a maximum award of $12 million, if the project is located in a GRM or QIT
- 60 percent of remediation costs up to a maximum award of $8 million, if the project is located elsewhere in New Jersey
Tax credits are transferable and may be sold for no less than 75 percent for certain projects which include Low Income Housing Tax Credits, or 85 percent of their value for other projects.
FISCAL AND RESIDENT PROTECTIONS
In order to receive tax credits through the Brownfields Redevelopment Incentive Program, developers must be in good standing with the NJ Department of Labor, NJ Department of Treasury, and the NJ Department of Environmental Protection. The developer must also enter into a redevelopment agreement with the NJEDA. The municipality in which the project will take place must provide a letter of support.
Projects will also be required to meet minimum environmental standards and pay prevailing wages to construction workers through the completion of the redevelopment project. Projects that include retail and/or distribution centers may require labor harmony agreements. The NJEDA may recapture all or part of a tax credit award if the organization that received the credit does not remain in compliance with its commitments.
FEES
Fees are determined on a tiered basis based on a project’s total cost of remediation as a reasonable proxy for the complexity of a project and, therefore, the administrative expense and staff time required to evaluate the application. The two tiers are those projects with total cost of remediation $5 million and under, and those with total cost of remediation over $5 million.
FEE TYPE | PROJECT SIZE | |
Up to $5MM | >$5MM | |
Application Fee | $2,000 | $7,000 |
Approval Fee | $5,000 | $15,000 |
Tax Credit Issuance Fee | $5,000 | $15,000 |
Transfer/Pledge/Assignment Fee (initial request) | $5,000 | $7,500 |
Transfer/Pledge/Assignment Fee (additional request) | $2,500 | $2,500 |
Minor Modifications and Extensions that do not require Board Approval | $2,500 | $5,000 |
Major Modifications and Extensions which require Board Approval | $5,000 | $10,000 |
Extensions that do not require Board Approval | $2,500 | $5,000 |
Extensions that do require Board Approval | $7,500 | $15,000 |
PROGRAM GUIDE
QUESTIONS
For more information or to ask a specific question, please send an email to bftaxcredit@njeda.gov and a team member will reach out to you.
Please contact the New Jersey Department of Environmental Protection at edataxinc@dep.nj.gov for questions regarding:
- Whether the site of the redevelopment project is a brownfield site pursuant to N.J.S.A. 34:1B-280.
- A determination as to whether the applicant/developer is considered a discharger of a hazardous substance at the brownfields site, or is a corporate successor to the discharger or to any person in any way responsible for the hazardous substance or to anyone liable for cleanup and removal costs pursuant to N.J.S.A. 58:10-23.11g, N.J.S.A. 34:1B-281, and N.J.A.C. 19:31-27.3.