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  Acting Gov. Guadagno Signs Bill Halting Development Fees, Says It Will Create Jobs
  By HUGH R. MORLEY
NorthJersey.com
August 24, 2011
Original Article
   
 

Builders of non-residential construction projects won’t have to pay a 2.5 percent fee under a bill signed by Lt. Gov. Kim Guadagno Wednesday.

The bill extends until July 1, 2013, the moratorium on fees for construction of commercial and industrial real estate that was initially enacted in 2009 as part of the package of economic stimulus measures.

Although the initial fee suspension expired on July 1, 2010, the latest bill also allows for the return of fees paid by builders over the last 13 months.

It was signed at a press conference outside a 70,000-square-foot warehouse on Peekay Drive in Clifton that Mountain Development Corp. of Woodland Park plans to demolish and replace with a 215,000-square-foot data center.

Michael Seeve, the company’s president, said the fee, which would have added about $1 million to the project cost, has held up the $40 million development. With the fee removed, the project will now go ahead - with Telex the likely occupant, he said.

Adding the fee to the project cost makes the state uncompetitive with neighboring states, said Seeve.

"Imagine if you have a client, and you show up to make a presentation and say ‘Come with me, but you pay an extra $1 million,’ " Seeve said. "That’s not a great way to do business."

Guadagno, who is acting governor while Governor Christie is out of state, called the fee "onerous and arbitrary."

"We are making it easier for commercial developers to invest in New Jersey, create jobs and help us build on the positive, early progress we’ve made in returning our state to prosperity and affordability," she said.

The fee was initially enacted in 2008 as part of changes to the Fair Housing Act and Municipal Land Use Law, and was intended to help municipalities meet their affordable housing obligations.

"This moratorium is about one thing - job creation," said Assemblyman Albert Couthino, D-Essex, a sponsor.

The New Jersey Chapter of NAIOP, the commercial real estate development association, said its members had identified 30 pending projects that would be helped by the change.

"This legislation can make the difference in allowing those projects to move forward and create construction and long-term jobs our state so desperately needs," said NAIOP NJ President George Sowa.