Competition for commercial/retail ratables has become a way of life for many municipalities in the chase for good clean businesses. Yet, the business climate in New Jersey continues to make it more and more difficult for attracting new companies to consider locating in the state.  

Some municipalities have “redevelopment zones” (streamline the approval process), Urban Enterprise Zones, Special Economic Districts or other type of designations that allow for financial (such as PILOT programs [payment in lieu of taxes] or tax abatements), infrastructure and/or expedited process incentives. These advantages give them an edge over the majority of other municipalities in attracting ratables and are important to developers because they lower their costs. Cost is the key to whether or not a developer will build or not. There is very little speculative building taking place today in New Jersey’s market. 

What is it that a municipality can do to be competitive in the marketplace to draw commercial/retail developers? 

Developers need to have a contact person in the municipality, such as an Economic Development Coordinator/Consultant who acts as the liaison between the municipality and the needs of the developer. The position of Economic Development Coordinator/Consultant should be multi-faceted. Economic Development is not just about bringing in new development, but requires direct involvement with a project from day one. Business incentives are important. But, many municipalities do not possess many incentives that some other communities provide.  

The demographics of many communities do not lend themselves easily to retail/commercial development. This requires having an Economic Development Coordinator/Consultant providing hands on services the other communities do not; e.g. assisting projects with NJDEP and NJDOT permitting issues, preliminary recommendations prior to submission of applications (significant cost savings to potential developers) locating financing, creating joint ventures, recommending potential professionals to represent the developer, expediting local permitting or MUA approvals and many other needs that come up to bring a project to completion. 

Although many communities have created an Economic Development Committee (EDC), this group does not provide the kind of role that would be helpful in the pursuit of economic growth for their communities. EDC’s are often made up of community leaders seeking ideas on how to bring in new development or create a better economic climate. The EDC needs to be made up of a group of business leaders and/or professionals; such as the municipal engineer, MUA, Planner, representative/s from the Planning and Zoning Board, representative/s of the governing body, code enforcement and the municipal administrator.  

Comprised of such key members, the EDC would act as the advisory body when a developer first approaches the municipality seeking to possibly locate there. The EDC would have a regular schedule of meetings during the year at which developers make preliminary presentations before starting the application process. Effective EDC programs have developers conceptually outline what they want to build and get immediate feedback from the Committee so that they are better prepared to submit applications. The more well informed a developer is about of the roles, expectations and working process of the EDC Board, the more likely the developer’s application will be deemed complete sooner.  Moreover, less time will be needed for review and approval by the Planning and Zoning Boards. This streamlined process saves the developer significant dollars in professional fees and time. Quite understandably, developers are very excited about dealing with these developer-friendly communities. 

The most effective economic development program for a municipality has been a combination of both an Economic Development Coordinator/Consultant and the Economic Development Committee working together. They act as a complement to one another in providing an effective structural design and as a service provider.

Both the Committee and the Economic Development Coordinator/Consultant must have access to up-to-date demographics on their community. Developers are always looking for accurate information in order to determine the feasibility of a project location. It is important that data is made available on the demographics of an area one mile, three miles and five miles from the projected location of the commercial/retail project.  

Developers’ needs legitimately require having a professional available on an on-going basis from the municipality acting as the liaison with the municipality’s professional staff and code enforcement officials to expedite the application and approval process. Timing and costs often cause stress between the developer and the municipality. However, the Economic Development Coordinator/Consultant assists in removing these tensions or stressors. As heretofore mentioned, the Coordinator/ Consultant definitely plays a major role in streamlining and expediting state permitting processes, thereby benefiting both the developer and the municipality.  

Numerous success stories around the state clearly demonstrate the importance and feasibility of the model described above for economic development.  Now more than ever is the time for municipalities to act in order to ensure their ability to access a piece of the ratable pie.