This Thursday the Assembly Labor Committee will be considering A-3994, which contrary to the bill’s title (“concerns prevailing wage law requirements for public institutions of higher education”), expands prevailing wage requirements to projects that have received financial assistance in the form of grants; loans; loan guarantees; expenditures; investments; tax abatements, exemptions, incentives, or rebates; incentives; or other financial assistance, any of which are provided, authorized, facilitated, or administered by public bodies, or by agencies or authorities of public bodies with exception of projects financed by NJHMFA.
Payment in Lieu of Taxes (PILOTs) are the single-most powerful tool available to municipalities to encourage property owners and developers to make improvements to property or to locate a project in a distressed or blighted area. With respect to long-term tax exemptions in particular, exemptions are granted only where the municipality has determined that the project would not occur but for the PILOT. Increasing the cost of already challenged projects by requiring a private property owner to pay prevailing wage for improvements on their property will prompt a greater demand on the municipality for a lower PILOT (thereby diminishing municipal revenue and property tax relief) and may even prevent a project from moving forward.
This is of particular concern where a project’s revenues will be limited, as in the construction of affordable housing, or where a project bears additional costs to meet other public needs or interests, such as environmental remediation, historic preservation, or the installation of infrastructure.
A-3994 will significantly weaken the ability of municipalities to spur economic development in blighted areas, and will also impede private investment that generates jobs, quality housing, environmental cleanup, and other public good.
Please reach out to the members of the Assembly Labor Committee and your Assembly Representatives urging them to vote NO on A-3994.
Contact: Lori Buckelew, Deputy Executive Director & Director of Government Affairs, lbuckelew@njlm.org, 609-695-3481, x112.