STATE OF NEW JERSEY
217th LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2016 SESSION
Sponsored by:
Senator NELLIE POU
District 35 (Bergen and Passaic)
SYNOPSIS
Amends Health Enterprise Zone law to allow municipalities more discretion in granting property tax exemptions to medical offices.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act concerning tax exemptions for medical and dental primary care offices in Health Enterprise Zones, and amending, P.L.2004, c.139, N.J.S.18A:71C-35, and P.L.1999, c.46.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 4 of P.L.2004, c.139 (C.54:4-3.160) is amended to read as follows:
4. a. A municipality that has within its boundaries a Health Enterprise Zone as described in section 1 of P.L.2004, c.139 (C.54A:3-7) may adopt [a resolution] an ordinance that provides for an exemption from taxation as real property of that portion of a structure or building that is used to house a medical or dental primary care practice as defined in N.J.S.18A:71C-32 and that is located in that designated area. The ordinance may limit exemptions under this section to property located within a delineated part or parts of that designated area. Additionally, or as an alternative thereto, an ordinance adopted pursuant to this section may provide that the exemption shall be limited to the portion of a structure or building that is used to house a medical or dental primary care facility that is newly rehabilitated or newly constructed after a date that is set forth in the ordinance. The exemption shall be in effect for tax years that are within the period of designation as a State designated underserved area and shall be contingent upon an annual application therefor filed by the property owner with, and approved by, the local tax assessor.
b. As used in this section:
"Newly rehabilitated" means the extensive repair, reconstruction, alteration or renovation of an existing structure or building in accordance with the Rehabilitation Subcode of the State Uniform Construction Code promulgated pursuant to P.L.1975, c.217 (C.52:27D-119 et seq.).
(cf: P.L.2004, c.139, s.4)
2. N.J.S.18A:71C-35 is amended to read as follows:
18A:71C-35. The Commissioner of Health and Senior Services, after consultation with the Commissioner of Corrections and the Commissioner of Human Services, shall designate and establish a ranking of State designated underserved areas. The criteria used by the Commissioner of Health and Senior Services in designating areas shall include, but not be limited to:
a. the financial resources of the population under consideration, including the percentage of the population that is eligible for medical assistance pursuant to P.L.1968, c.413 (C.30:4D-1 et seq.) and P.L.2005, c.156 (C.30:4J-8 et seq.), and the percentage of the population that does not have health insurance coverage;
b. the population's access to primary care services;
c. appropriate physician, dentist, or other primary care staffing in State, county, municipal and private nonprofit health care facilities and in clinics which are part of the extramural network of dental clinics established by the New Jersey Dental School of the University of Medicine and Dentistry of New Jersey; and
d. the extent to which racial and ethnic disparities in health care in a geographic area, including, but not limited to, disparities in the incidence of cancer, cardiovascular disease, stroke, chemical dependency, diabetes, asthma, homicide, suicide, accidental injury, infant mortality, child immunization rates, HIV/AIDS, dental caries, and periodontal disease, indicate the need to increase access to primary care services among racial and ethnic minority populations in that area.
The Commissioner of Health and Senior Services shall transmit the list of State designated underserved areas and the number of positions needed in each area to the executive director or designee and shall annually certify the list of State-designated underserved areas to the Director of the Division of Taxation in the Department of the Treasury. The list shall contain the name of each municipality wherein a State designated underserved area is situated and other appropriate identifying information.
(cf: P.L.2009, c.145, s.4)
3. Section 5 of P.L.2004, c.139 (C.54:4-3.161) is amended to read as follows:
5. a. Upon the granting of an exemption from taxation as real property pursuant to section 4 of P.L.2004, c.139 (C.54:4-3.160), an owner of the building or structure granted the exemption shall rebate to a tenant engaged in the medical or dental primary care practice an amount equal to the exemption, which may be a lump sum or rebated through discounted rental payments.
b. The tenant engaged in the medical or dental primary care practice or the owner of the building or structure granted the exemption shall annually submit proof to the local tax assessor that the amount of the exemption was rebated to the eligible tenant. If proof satisfactory to the tax assessor is not provided in the manner that the tax assessor shall establish, the exemption shall not be allowed for the tax year and the owner of the property shall refund the amount of the exemption for that tax year to the municipal tax collector.
c. The Director of the Division of Taxation in the Department of the Treasury may prescribe rules and regulations and design applications and materials that are necessary to effectuate the tax provisions of P.L.2004, c.139 (C.54A:3-7 et al.).
(cf: P.L.2004, c.139, s.5)
4. This act shall take effect immediately.
STATEMENT
This bill allows municipalities to grant property tax exemptions to limited categories of medical and dental primary care offices in an Health Enterprise Zone (HEZ), an underserved area designated by the Commissioner of Health and Senior Services.
Pursuant to current law, any municipality that has within its boundaries an HEZ may currently exempt from property taxation all medical and dental primary care practices located in the zone. This bill permits the granting of the property tax exemption by ordinance to a subset of medical and dental primary care practices in a zone. Specifically, municipalities may limit the exemption to practices located in a delineated part or parts of a zone or housed in a newly constructed or newly rehabilitated structure or building, or both.
Many municipalities with an HEZ have not created a broad exemption as an incentive to doctors and dentists to serve their medically underserved populations because of the substantial cost of authorizing the property tax exemption. The more limited categories of exemptions permitted under the bill may provide more targeted incentives and limit the property tax losses.