A bill backed by the state Legislature’s top Democratic and Republican lawmakers would provide $300 million in loans and grants to help keep businesses afloat during the COVID-19 pandemic.
The money would be available to businesses and nonprofits that have taken a financial hit from the economic downturn and, like the current assistance programs, be overseen by the New Jersey Economic Development Authority.
A text of the legislation was not immediately available, nor is it clear when the measure would move forward.
Republicans Sen. Declan O’Scanlon, R-13th District, Sen. Mike Testa, R-1st District and Senate Republican Leader Tom Kean, R-21st District will co-sponsor the bill. Senate President Stephen Sweeney, D-3rd District, Sen. Dawn Addiego, D-8th District and Sen. Vin Gopal, D-11th District, are the Democratic co-sponsors.
“This $300 million investment will speed up our economic recovery from the pandemic, prevent more businesses and nonprofits from closing, and create jobs for workers who have been on the unemployment rolls for almost a year,” Sweeney said in a Feb. 11 statement.
Businesses hurt by the pandemic would be eligible, as would those whose opening plans were upended. Many had to shut their doors or scale back operations for months. As a result, demand for state aid and forgivable loans from the Biden and Trump administrations swamped both federal and state government agencies.
For much of last summer and fall after applications closed for federal relief, the limited pot of funding offered by the NJEDA was the only lifeline for businesses, and tens of thousands of applicants poured in. To date, the agency has awarded more than $82 million in COVID-19 relief grants to 31,477 employers and more than $10 million of low-interest loans to 152 businesses.
Last year, the federal government awarded $17 billion in forgivable loans to New Jersey businesses under the Paycheck Protection Program, which recipients must use to cover payroll costs. After the program was renewed, the federal government awarded more than $3 billion of loans to New Jersey businesses in 2021, according to the federal Small Business Administration, which oversees the PPP loans.
A $10 million round of funding under the NJEDA’s low-interest loan program is on hold now, as state officials gauge whether shortcomings in the PPP program could be addressed by the state assistance.
Tim Sullivan, who heads the NJEDA, said planning for this round of $10 million was underway when the prior round of the federal loans had ended.
“The deferral … will provide an opportunity for us to analyze which businesses are unable to benefit from the PPP program and learn what additional support businesses that do receive loans need and adapt our COVID-19 relief efforts to complement federal resources available for small businesses,” Sullivan said in a Feb. 5 email.