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NJEDA outlines $500 million tax-credit plan and fellowships to boost AI ecosystem
Summary
NJEDA CEO Tim Sullivan told the Senate Legislative Oversight Committee the administration will use the Next New Jersey program to direct up to $500 million in tax credits toward AI-related capital and job-creating projects and will launch AI Innovation Fellows and preferential compute access to support startups.
Tim Sullivan, chief executive officer of the New Jersey Economic Development Authority, told the Senate Legislative Oversight Committee that the administration is positioning the state to compete in generative artificial intelligence through a mix of tax credits, fellowships and strategic centers.
"The governor just signed a piece of legislation that was passed, as part of the budget cycle. He signed it this summer, called the next New Jersey, program, which dedicates up to $500,000,000 of tax credits ... to support, the AI industry," Sullivan said, describing credits aimed at large capital expenditures and job-creating projects.
Sullivan highlighted an AI Innovation Fellows program funded in the governor's budget that will offer salary-replacement grants of up to $400,000 per founding team to help founders leave jobs and launch startups. He said the first cohort previously emphasized women and people of color and that an AI-specific cohort would launch soon.
The NJEDA chief also emphasized compute access as a strategic priority, saying any state subsidies tied to AI infrastructure should confer preferential compute access to New Jersey startups and higher-education institutions. He said the agency is writing rules for the Next New Jersey program and expects to begin accepting applications in the early part of next year.
Committee members pressed Sullivan on geographic distribution and the role of big cloud providers. Sullivan said large companies with balance sheets will likely build major data centers, but that New Jersey firms already in the market, such as CoreWeave, are growing locally. He added that the agency is pursuing multiple innovation centers across the state, including partnerships in Atlantic County and Greater Camden.
The hearing did not include formal votes on these plans. Sullivan said program rules and application timelines will be available after the NJEDA completes rulemaking and urged the legislature to consider implementation details such as matching-fund requirements and workforce provisions.
The committee will hold future hearings that dive into legislation and implementation details raised during testimony.
