Association backs effort to create, build in New Jersey
(The Center Square) – The New Jersey Innovation Evergreen Fund program has gained the support of the New Jersey Business and Industry Association to get the state back to creating and building.
The NJIEF intends to create partnerships between the state and the private sector in support of innovation in the state, the governor’s office said in a release. The state will make equity investments, along with private venture capital, into startups, deploying up to $600 million into those companies.
“NJBIA has been supportive of the program as we’ve long been a proponent of growing New Jersey’s innovation ecosystem,” Christopher Emigholz, NJBIA vice president of Government Affairs, told the Center Square. “Over the years, we’ve seen a shift of New Jersey becoming more of a service industry state. We want to get back to more of where we’re creating and building things.”
Over five years, $300 million in tax credits will be auctioned off, he said. The annual cap was set at $60 million. The state will then partner with venture capital firms to invest in and support start-up innovation companies.
Only corporations registered to do business in New Jersey are eligible, the governor’s office said.
“The New Jersey Innovation Evergreen Act will allow qualified corporations to purchase transferrable tax credits through auctions,” Emigholz said. “To qualify, those corps must also agree to work with the state to support innovation goals, whether it’s with providing networking, mentorship or other collaborative opportunities to businesses receiving funding in the program.”
He said the Innovation Evergreen Fund will be seeded with cash from the proceeds of those auctions. The fund will be used for investment in innovation programs to help advance New Jersey’s competitiveness in this space.
An NJBIA “Indicators of Innovation” updated study in 2020 found that the state’s overall regional innovation score competed for fourth with Maryland. Massachusetts and New York took the top rankings.
New Jersey’s state government R&D expenditures also had it ranked fourth in the seven-state region, that 2020 study found. In an 11-year analysis, New Jersey increased R&D expenditures by 157% from 2007 to 2018, going from nearly $20 million to $51.3 million.
The 2020 Indicators of Innovation report concluded that recreating an innovation system requires a strong presence of capital, talent and business. New Jersey falls in the middle of the pack in those categories. What undermines the state’s ability to lead in innovation is the business tax climate and net migration of first-time college students, the report said.
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