Tuesday, March 31, 2020

NJEDA to support State businesses

31-March-2020

New Jersey Economic Development Authority Announces New Initiatives to Support Businesses Impacted by COVID-19


TRENTON, N.J. (March 26, 2020) – The New Jersey Economic Development Authority (NJEDA) Board today
 approved a suite of new programs designed to support businesses and workers facing economic hardship 
due to the outbreak of the novel coronavirus COVID-19.
 
The package of initiatives includes a grant program for small businesses, a zero-interest loan program for mid-size
companies, support for private-sector lenders and Community Development Financial Institutions (CDFIs), 
funding for entrepreneurs, and a variety of resources providing technical support and marketplace information.
 Taken together, they will provide more than $75 million of State and private financial support, with the 
opportunity to grow to more than $100 million if additional philanthropic, State, and federal resources become
 available. The initiatives will support between 3,000 and 5,000 small and midsize enterprises and are meant to
 complement recently announced federal economic recovery initiatives.
 
More information about the programs is available here: https://cv.business.nj.gov.
 
“The outbreak of the novel coronavirus in New Jersey has sent us into uncharted territory,
 and the economic impacts will be significant and far-reaching, especially on Main Street. 
The scope and scale of this new challenge requires immediate action to support New Jersey 
workers and businesses,” said Governor Phil Murphy. “The new NJEDA programs announced
 today are a critical step that will mitigate the economic impacts of this unprecedented 
challenge and help workers and businesses to weather the storm and come out stronger 
when things return to normal.”
 
Development of the grant program, support for CDFIs, and flexibility for current NJEDA
borrowers was enabled by the legislature through A3845. Primary sponsors of the legislation
include Assemblymembers Roy Freiman, Louis D. Greenwald, Ronald S. Dancer, and 
Senators Nilsa Cruz-Perez, and Brian Stack.
 
The new NJEDA initiatives focus on businesses that have been hit hardest by the 
novel coronavirus outbreak: local small businesses, mid-size businesses that have had to
close or drastically reconfigure operations, and new businesses who were just getting on
their feet before the crisis hit. The programs provide a suite of compatible offerings that
address these businesses’ varied needs and include mechanisms to provide funding 
and assistance as quickly as possible.
 
Many of the resources are designed to be scalable with the addition of federal and 
philanthropic resources if they become available. Philanthropic partners interested in
 donating to support the NJEDA’s small business grant program should reach out to:
 donations@njeda.com.
 
“Small- and medium-sized enterprises are the heartbeat of New Jersey’s economy and it is 
crucial that we do what we can to provide the resources and assistance they need to
 withstand the outbreak of novel coronavirus,” said NJEDA Chief Executive Officer
 Tim Sullivan. “In coordination with our partners throughout State government, we are
 undertaking an unprecedented effort to support these businesses and the New Jersey
 residents who rely on them for their livelihoods. These are challenging times, but New 
Jerseyans are resilient, and together we will get through this and rebuild our economy.”
 
The suite of new initiatives includes:

Small Business Emergency Assistance Grant Program – A $5 million program that
 will provide grants up to $5,000 to small businesses in retail, arts, entertainment, recreation,
 accommodation, food service, and other services – such as repair, maintenance, personal, 
and laundry services – to stabilize their operations and reduce the need for layoffs or
 furloughs.

Small Business Emergency Assistance Loan Program – A $10 million program that 
will provide working capital loans of up to $100,000 to businesses with less than $5 million in
 revenues. Loans made through the program will have ten-year terms with zero percent for 
the first five years, then resetting to the EDA’s prevailing floor rate (capped at 3.00%) for 
the remaining five years.

Community Development Finance Institution (CDFI) Emergency Loan Loss
 Reserve Fund – A $10 million capital reserve fund to take a first loss position on CDFI
 loans that provide low interest working capital to micro businesses. This will allow CDFIs
 to withstand loan defaults due to the outbreak, which will allow them to provide more loans
 at lower interest rates to microbusinesses affected by the outbreak.

CDFI Emergency Assistance Grant Program – A $1.25 million program that will
 provide grants of up to $250,000 to CDFIs to scale operations or reduce interest rates for
 the duration of the outbreak.

NJ Entrepreneur Support Program – A $5 million program that will encourage
 continued capital flows to new companies, often in the innovation economy, and temporarily
 support a shaky market by providing 80 percent loan guarantees for working capital loans
 to entrepreneurs.   

Small Business Emergency Assistance Guarantee Program – A $10 million program
 that will provide 50 percent guarantees on working capital loans and waive fees on loans 
made through institutions participating in the NJEDA’s existing Premier Lender or Premier
 CDFI programs.

Emergency Technical Assistance Program – A $150,000 program that will support 
technical assistance to New Jersey-based companies applying for assistance through the
 U.S. Small Business Administration. The organizations contracted will be paid based on 
SBA application submissions supported by the technical assistance they provide.
 
Additional details on the NJEDA’s new programs, including complete eligibility requirements
New Jersey’s response to the novel coronavirus outbreak is available 
here: https://covid19.nj.gov/.
 
 
About the New Jersey Economic Development Authority
The New Jersey Economic Development Authority (NJEDA) serves as the State’s principal 
agency for driving economic growth. The NJEDA is committed to making New Jersey a
 national model for inclusive and sustainable economic development by focusing on key
 strategies to help build strong and dynamic communities, create good jobs for New Jersey
 residents, and provide pathways to a stronger and fairer economy. Through partnerships 
with a diverse range of stakeholders, the NJEDA creates and implements initiatives to
 enhance the economic vitality and quality of life in the State and strengthen New Jersey’s long-term economic competitiveness.
 
To learn more about NJEDA resources for businesses call NJEDA Customer Care

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