New Jersey Economic Development Authority Grant and Loan Programs
I’m very happy to bring you some good news this morning.
The New Jersey Economic Development Authority just approved and announced a package of grant and loan programs for small- and mid-sized businesses and non-profits hit hard by the coronavirus crisis.
We worked with EDA on these programs, which are varied in nature. EDA estimates the initiatives will support between 3,000 and 5,000 enterprises. And while the funding earmarked for these grants and loans will not make all of our New Jersey businesses whole, this is a great first step and those in need will be able to apply soon.
Here are the details:
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 10-year terms with 0% interest for the first five years, then resetting to the EDA’s prevailing floor rate (capped at 3%) for the remaining five years.
- Community Development Finance Institution (CDFI) Emergency Loan Loss Reserve Fund – A $10 million capital reserve fund to take first loss position on CDFI loans that provide low interest working capital to microbusinesses. 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 innovation economy companies and temporarily support a cautious investor market by providing 80% loan guarantees for working capital loans to startup entrepreneurs.
- Small Business Emergency Assistance Guarantee Program – A $10 million program that will provide 50% guarantees on working capital loans and waive fees on loans made through institutions participating in the NJEDA’s existing Premier Lender or CDFI programs.
- Emergency Technical Assistance Program – A $150,000 program that will support technical assistance to New Jersey-based companies applying for Economic Injury Disaster Loans 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.
We continue to strongly urge all business owners who are interested in these programs to QUICKLY take inventory of all necessary evidence of cash flow and income over the past year, including receipts and invoices, and to connect with your accountants. This way you can put your most effective foot forward during the application process and get in early. Don’t wait. Get ready now!
Additional details on the NJEDA’s new programs, including complete eligibility requirements, will soon be available at https://cv.business.nj.gov, if not already.
NJBIA continues to support the New Jersey business community as we go through this crisis together. We continue to update our own Coronavirus Resource Page, where you can also contact us if you have any other additional questions. Our staff is here for you and ready to help.
Michele N. Siekerka, Esq.
President & CEO