Economic Redevelopment and Growth (ERG) Program to Relaunch in June
On March 2, the New Jersey Economic Development Authority (NJEDA) announced the the residential component of the Economic Redevelopment and Growth (ERG) Program will relaunch this year. The NJEDA will relaunch the program utilizing $50 million in tax credits designated in the Economic Recovery Act of 2020.
The NJEDA will start accepting applications no earlier than June 1, 2021 to provide at least 90 days of preparation time for potential applicants. The ERG program, which was originally created to address project financing gaps in development projects, had previously stopped accepting new applications in June 2019.
Under the Economic Recovery Act, residential ERG projects can receive tax credits of up to 30 percent of total eligible project costs. Projects in five cities -- Atlantic City, Camden, Paterson, Passaic, and Trenton – can receive tax credits up to 40 percent of eligible project costs. ERG tax credits are not meant to be a substitute for conventional debt and equity financing, and applicants should generally have their primary debt financing in place before applying.
The new phase of the ERG program will be administered based on pre-existing ERG regulations and statutes, as amended by the Economic Recovery Act, which added new prevailing wage and minimum wage requirements. NJEDA anticipates issuing a solicitation (or call for applications) document with further information about this process in early April. For additional information and detailed eligibility requirements, visit https://www.njeda.com/economicrecoveryact/.