NJ governor signs bills to expand angel investment tax credits, fund TBED

New Jersey Gov. Phil Murphy signed multiple bills late last month that may help position the state as a leader in technology-based economic development. One bill increases the tax credit for angel investors in qualified technology companies, with even larger credits available for investments in women- and minority-owned businesses and those located in low-income areas. Meanwhile, the state’s approved FY 2020 budget includes $1.0 million for the New Jersey Commission on Science, Innovation, and Technology. After nearly a decade of receiving no funding from the state, this marks the second consecutive year that the commission will receive $1.0 million to support technology-based economic development.

As a result of A-5604/S-2298, which passed overwhelmingly in both chambers, the tax credit available under the Angel Investor Tax Credit Program will be increased from 10 percent to up to 20 percent of a qualified investment made in a NJ emerging technology business. The law also would allow a tax credit of up to 25 percent if the emerging technology businesses are certified minority or women-owned, or if they are located in a qualified Opportunity Zone or a low-income community.

S-2020/A-5600, the state’s FY 2020 appropriations act, was signed by the governor on June 30. The bill includes $1.0 million for the New Jersey Commission on Science, Innovation, and Technology for the second straight year. Originally developed in the 1980s, the program was essentially dissolved by then-Gov. Chris Christie in the wake of the Great Recession.  The commission seeks to promote academic and industry R&D and commercialization in the state.

Notably, a $500 million “Innovation Evergreen Fund,” a hallmark of the governor’s proposed budget and economic development strategy, did not receive funding in the approved budget. An article in NJ Spotlight notes that there were disagreements between the governor and the legislature about whether to add new economic development programs at a time when the state was grappling with whether to continue with its existing incentives.