Both the state Assembly and Senate are slated to vote Thursday on $100 million in state aid for pandemic-hit businesses, and a variety of tax breaks meant to hold employers over in the coming months of reduced capacity and ensuing reopenings.
Those funds would come at a critical time, as the most recent weeks of new COVID-19 surges have prompted Gov. Phil Murphy to pause the state’s reopening for the near future.
Five bills would appropriate $100 million, which includes $25 million to microbusinesses – $35 million to bars and restaurants, $10 million to daycare, $15 million to arts and culture groups, and $15 million for other businesses and nonprofits. They were approved by the Senate Budget and Appropriations Committee at their remotely-held hearing on March 22.
The money would come out of federal COVID-19 relief aid to the state under the Trump-era Coronavirus Aid, Relief and Economic Recovery Act, and be doled out by the New Jersey Economic Development Authority.
That state agency currently oversees hundreds of millions of dollars in other grants, low-interest loans and other state subsidies meant to keep businesses afloat that have seen major disruptions because of the pandemic.
According to the proposed Assembly Bill 5443, microbusinesses are those with less than 10 employees.
“New Jersey must do it all it can as quickly as it can to ensure the businesses that have survived this long are able to make it through the next few months,” reads a March 22 statement from Chris Emigholz, vice president of government affairs at the New Jersey Business and Industry Association.
The proposed “New Jobs for New Jersey Act” creates tax breaks for employers with less than 100 workers, for every person they hire after April 1 this year. It’s up for a vote in just the state Senate.
To qualify for tax breaks, those hired workers must have been out of work for at least 30 days and have no history of prior employment with the business. Under the proposal, the number of eligible employees in the 12 months following April 1 needs to be greater than in the preceding 12 months, according to the bill.
“Through this program, we can assist businesses as they fight to stabilize their companies while hiring back laid off workers,” one of the bill’s sponsors, Sen. Nilsa Cruz-Perez, D-5th District, said in a March 22 statement.
One measure just being taken up in the state Assembly – A4958 – would let businesses with less than 20 employees apply for tax refunds on any sales tax they paid to “winterize their businesses,” such as tents, space heaters and snow and ice removal equipment. There is currently no version in the Senate.
Senate Bill 3234 would exempt federal COVID-19 relief loans under the Paycheck Protection Program from state taxes, a move which mirrors a previous extension of the measure then-U.S. President Donald Trump signed on Dec. 27.
The bill passed the state Assembly on March 1 and would head to the governor’s desk if it is approved by the Senate on Thursday.
According to the federal Small Business Administration – which oversees the program – a combined 71,587 New Jersey businesses received $5.8 billion of federal forgivable loans.