Senate Approves Greenstein, Singleton Bill To Provide Tax Credits To Low-Carbon Concrete Manufacturers

Trenton – In an effort to encourage the use of environmentally responsible construction materials throughout the state, the Senate today approved legislation sponsored by Senator Linda Greenstein and Senator Troy Singleton that would provide corporation business tax (CBT) credits and gross income tax (GIT) credits to concrete manufacturers that deliver certain forms of concrete associated with reduced greenhouse gas emissions for State-funded construction and improvement projects that require the use of 50 or more cubic yards of concrete.

“State and local governments are the largest procurers of concrete materials, accounting for 40 percent of all concrete consumption,” said Senator Greenstein (D-Mercer/Middlesex). “As the manufacturing of concrete continues to increase, we must ensure we are doing all that we can to decrease the harmful emissions released during the production process. By encouraging the use of low embodied carbon concrete, we will be able to decrease our carbon emissions drastically while still fulfilling the needs of construction projects. This bill would be an important step towards decarbonization in New Jersey and ensure that future generations will be able to enjoy our beautiful state and all that it offers.”

The bill, S-287, would provide a CBT or GIT credit to concrete manufacturers that deliver low embodied carbon concrete, equaling up to five percent of the project’s total concrete cost. The bill would also provide a CBT or GIT credit for the delivery of concrete that incorporates carbon capture, utilization, and storage, equaling up to three percent of the cost of concrete. Additionally, CBT or GIT credits would be provided to taxpayers that produce concrete or a major component of concrete for the costs of conducting environmental product declaration analyses.

"Carbon is the second most consumed material on Earth after water and it is responsible for almost eight percent of the world’s carbon dioxide emissions,” said Senator Singleton (D-Burlington). “Currently, the State has a goal to curb carbon emissions by 2050. With this proposal, we're incentivizing the production of low carbon concrete with an eye toward that goal."

Under the bill, the Department of Environmental Protection would be authorized to determine a formula for the tax credit amounts, providing that the amount of the tax credits be proportional to the reduction in greenhouse gas emissions below the baseline achieved by the concrete. An individual concrete manufacturer would be limited to a maximum CBT or GIT credit of $1 million annually. The cumulative total of tax credits issued annually would be capped at $10 million.

The bill passed the Senate by a vote of 39-0.