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As talks begin to ramp up concerning the state budget, and politicking becomes more intense in the effort to hash out a new set of tax breaks, lawmakers are moving to keep the two discussions separate—a challenging endeavor given that a resolution has to be met on both by July 1.

Assembly Budget Chair Eliana Pintor-Marin, D-29th District, at the real estate group  NAIOP’s Next Generation Incentives: Building on Success event Tuesday in Edison, touted a measure she dubbed “Grow New Jersey 2.0,” which would extend the existing Grow New Jersey tax break program by at least one more year to buy time for negotiations. 

The Grow NJ tax break program has awarded billions of dollars in credits and is slated to end on July 1, which Gov. Phil Murphy supports.

I would like this to not be a part of budget negotiations. The budget itself is a monster and we need to pay attention to that. I would like it to be a separate conversation.

Meanwhile, Murphy’s $38.9 billion budget calls for a controversial “millionaire’s tax” proposal from which the governor has not backed down, even though lawmakers have said the tax is a non-starter.

“I just think that right now, they’re complicated… and I just think that we need to let cooler heads prevail and we need to kind of let the budget process play out and then we have those negotiations,” Pintor-Marin said.

“Hopefully it will be after the budget and we can have those negotiations to maybe extend the program just for say a year,” she added.

Her measure, Assembly Bill 4730, would not cap the amount of tax incentives the state awards each year, as Murphy had sought, but it would reign in the bonuses companies could receive.

Pintor-Marin, as well as other top lawmakers including Senate President Stephen Sweeney, D-3rd District, have touted the economic benefit that Grow NJ has brought to such cities as Camden, Jersey City and Newark.

“To allow the two programs – Grow NJ and [the Economic Redevelopment and Growth gap financing program] to expire, I think would be a mistake,” Pintor-Marin said. “I would like this to not be a part of budget negotiations. The budget itself is a monster and we need to pay attention to that. I would like it to be a separate conversation.”  

Still, a person close to the discussions, who requested anonymity, said on background that the Legislature had ample time to act on renewing the state’s tax breaks.

Murphy made a point to tell lawmakers in his March 2018 budget address that the tax breaks would expire next year, this person said, and in November he sent three bills to the Legislature – none of which have been acted on – that would create several new economic incentives.

Murphy has proposed five new economic incentive programs, capped at $400 million a year. The proposed NJ Forward and NJ Aspire would replace Grow NJ and ERG respectively.

Murphy also unveiled a historic preservation tax credit, a Brownfields tax credit program to clean up and redevelop polluted properties, and so-called “evergreen fund,” in which the state and venture capital firms would finance start-ups 50/50 that are looking to set up shop in New Jersey.

It is not clear whether the Senate or governor’s office will entertain extending Grow NJ and creating Pintor-Marin’s sought after “Grow NJ 2.0”

Sources in the Legislature said that there have been ongoing discussions today about legislation to extend Grow NJ.

Murphy and other critics often cite a January audit which found that the Economic Development Authority, tasked with administering Grow NJ, had little oversight into the tax breaks it awarded, and that it overpaid and over awarded tax breaks to companies that were not compliant with the program, or should have never received the awards in the first place.

A March WNYC report unearthed whistleblower allegations that the Christie administration pressured officials to illegally churn out tax breaks to companies that should have not received those incentives, while a whistleblower testimony later that month alleges financial services firm Jackson-Hewitt lied to cheat the state out of over $2 million of tax breaks.

That task force is scheduled to hold its second hearing this Thursday in Newark.

EDA Chief Executive Officer Tim Sullivan, also at the NAIOP event, touted Murphy’s five proposed economic incentives, which would be capped at $400 million a year. The proposed NJ Forward and NJ Aspire would replace Grow NJ and ERG respectively.

“The governor proposed his economic development package in October and his plan is to move forward with that package,” reads a statement from Darryl Isherwood, a spokesperson for the governor’s office. “Two audits and a task force hearing have outlined the flaws in the current system and the bottom line is substantial changes need to be implemented. Gov. Murphy has made reforming tax incentives a central goal of his administration since day one. The economic development initiative proposed last fall achieves that goal. ”

The Senate Democrat’s office declined to comment.