Chamber Supports Pro Business Bills in Senate
Friday, January 07, 2011

M E M O R A N D U M

TO: Members of the New Jersey State Senate

FROM: Kathleen A. Davis, Executive Vice President & COO

RE: Pro-Business Legislation Under Consideration

DATE: January 6, 2011

The Chamber of Commerce Southern New Jersey commends the Senate for considering a number of bills today that are about improving the business climate and ultimately creating jobs. These bills are certainly necessary during a time when businesses are still struggling to rise out of the economic slump. We know that our members continue to face challenges in this economy.

By way of background, I wanted to share with you some information from our membership which will affirm why these efforts are so important:

1. Each year we conduct a survey of our membership. The top three issues in order of importance facing our members this year and last were health insurance costs, access to capital and business taxes.

2. Each quarter the Federal Reserve Bank of Philadelphia surveys our members on their current and predicted business activity. This year’s third quarter survey reflected that while we are told that the recession “officially ended in June 2009,” many of our members perceived little improvement in the overall economy during the third quarter. Economic conditions in the region remain weak, and there was actually a slight decline in the pace of growth compared to second quarter of 2010.

3. A few comments that our members included in the Third Quarter Federal Reserve Bank survey:

“Our gross income for the first 9 months of the year is only 50% of last year. And our gross revenue for this year will only be 20% of what it was four years ago.”

“My small and mid-size business clients report no meaningful improvement.”

“The burdens on small business from many sources continue to squelch job and wealth creation. “

“Our company was in the red for the first time in 25 years.”

We pleased to offer our support for the following bills on today’s board list:

S-2183 (Norcross), which extends eligibility of investors in business or housing projects for tax credits under the Urban Transit Hub Tax Credit Act. In Southern New Jersey, we’ve experienced the successes this program can produce when Pinnacle Foods relocated its headquarters to Cherry Hill – adjacent to the Woodcrest Station stop along Patco’s high speed line.

S-1540 (Buono/Oroho), which consolidates certain business-related categories of gross income and provides a 20 year carryforward of certain net losses. The Chamber believes this legislation will be an important tool for many of our member companies, including small businesses, high tech companies, manufacturers and start up companies. The capital that could be freed up as a result of this consolidation of losses and gains can be used by the company to invest in its existing workers, hire new employees, purchase equipment, research and development activities, or simply to cover normal operating expenses.

S-2454 (Madden/Sarlo), the “Angel Investor Tax Credit Act.” Angel investors are a private source of investment money, usually used to help a promising company grow and meet their potential. Angels fulfill a need for capital that cannot be met by bank loans or the private means of the current owners. Sometimes they also offer consulting and management advice. Angel investors offer a unique way for a business to raise capital without making financial commitments of their own in the way of loans or getting new permanent partners. Angels are also known to be capital providers for start up businesses in New Jersey who have good ideas, but nothing to back it up. They are providing capital to get the business idea off the ground. We support reviving the Small New Jersey-based High Technology Business Investment Tax Credit.

S-2545 (Madden/Girgenti/Sarlo), which establishes a closing fund, up to $50 million per year, to provide financial resources for certain economic development projects. The creation of this fund will give the Treasurer and the NJEDA another tool to retain, expand, or attract businesses in designated industries to our State. Many other states have such a fund available; we believe New Jersey should have such revenue available to them to capture companies that may not qualify under existing programs.

We are hopeful that the legislature will continue its efforts to promote legislation that will make New Jersey more business friendly. The CCSNJ stands ready to work with the legislature and the administration to help put our state on track to grow a vibrant economy.