COVID-19 infection numbers remain high in New Jersey, something that’s not helping the case for employers who would like their workers to return to the office. And it could cost companies millions in tax breaks that hinge on employees showing up in person.
Several hundred companies around the state are participating in the Economic Development Authority’s Grow NJ program. “When those companies were first approved for those awards, the rules were they had to be in the office eighty percent of the time. And then during COVID when we were reauthorizing some new incentives, the governor and Legislature provided some provisions that said we could take that down to sixty percent, trying to be responsive to changing workplace dynamics,” said Tim Sullivan, CEO of the EDA. “Part of the bargain that was struck with these companies, acting in good faith on both sides, is we want more jobs in our urban centers. We want people to be in our cities, supporting small businesses, bringing dynamism and investment and revitalization to our urban communities.”
So far, eight companies are choosing to forgo a total of $73.5 million in tax credits so their employees can keep working from home. Solomon Lax, CEO of Pearl Capital Business Funding, says the state needs to get more creative with its tax incentive programs, before companies that are fully remote start moving their headquarters out of the state.
