NJBIA is urging members of the Senate Budget and Appropriations Committee to reject legislation that would eliminate uncommitted Next New Jersey tax credits for artificial intelligence (AI) data centers and redirect that money to other energy programs.
“At a time when neighboring states are aggressively competing for artificial intelligence and digital infrastructure investment, New Jersey should be strengthening its position as a destination for these projects rather than withdrawing incentives before the program has had an opportunity to mature,” said NJBIA Research Analyst Jack Ramirez in testimony that he and IBEW Local 102 President Bernard Corrigan submitted to the committee.
Only one AI data center, a $1.8 billion project under construction in Kenilworth, has been approved for an NJEDA tax credit so far. Bill S-4390, sponsored by Senator Joseph Cryan (D-20), would not affect that project, but it would eliminate future AI tax credits and redirect about $250 million in unallocated tax credits to energy-related projects instead.
“While we support efforts to strengthen New Jersey's electric grid and improve energy reliability, we do not believe those goals should come at the expense of one of the state's fastest-growing economic development opportunities,” Ramirez and Corrigan wrote.
Data centers are a significant contributor to New Jersey's economy and help support union jobs across the state, they said.
According to a 2026 PwC study, the data center industry supported 35,180 direct jobs in New Jersey in 2024 and contributed to a total employment impact of 172,020 jobs statewide. The industry generated $17.89 billion in labor income, contributed $25.6 billion to New Jersey's GDP, and produced $2.7 billion in state and local tax revenue.
“These facilities, which have been around for decades, also support critical sectors of the economy, including manufacturing, healthcare, financial services, cybersecurity, education, public safety, and government services,” Ramirez and Corrigan said.
“For organized labor, data center development represents a source of high-quality construction and reliable skilled trades employment,” they said.
The Senate Budget and Appropriations later voted to release the bill.
