Whoops! State Treasury Reclaims More than $4M from City UEZ Program
By Jon Whiten • May 15th, 2009 • Category: Blog, News
The state is reclaiming $40 million in sales tax money mistakenly sent to 37 New Jersey towns that have Urban Enterprise Zones, including more than $4 million in Jersey City.
The Treasury Department reclaimed the money after learning of a mistake made three years ago. In 2006, the state sales tax was increased from 6 to 7 percent. Half of that increase was supposed to go to the state and half was supposed to go to property tax relief, but instead, state officials mistakenly directed half to tax relief and half to the UEZs for two years.
City spokesperson Jennifer Morrill says that once the move is approved, the state will put the money in a reserve account. She adds that the money could affect future allocations, but wouldn’t impact any pending projects or allocations in Jersey City.
The mayor says the state’s action is wrongheaded.
“We don’t know if it is allowed, but on first blush we’re against this,” Mayor Healy says. “UEZ funds should remain in the city where they are generated.”
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Jon Whiten is the founding editor of the Jersey City Independent; he now works for a public-policy nonprofit in Trenton.
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