The New Jersey Economic Development Authority said Monday it reached the 10,000-mark for businesses it awarded pandemic relief aid to, as employers up and down the state scale back or completely cease operations amid the drawn-out COVID-19 pandemic.
As of Monday, according to Gov. Phil Murphy, the NJEDA approved 10,624 grants, low-interest loans, and loan guarantees meant to offer a financial cushion for investors putting money into struggling startups.
All told, that makes up more than $44 million of small business aid, according to the Murphy administration.
“These programs have provided a lifeline to many small businesses as we navigate how to reopen and conduct business while continuing to prioritize public health,” the governor said Monday at a COVID-19 press briefing in Trenton.
The NJEDA’s aid programs, like their federal counterpart, the U.S Small Business Administration’s forgivable loan program, have been inundated with tens of thousands more applicants than there are funds available in the state’s pot of money.
“While there is still significantly more work to do, the insights we have gained from what we have accomplished so far will guide our next steps toward addressing business owners’ concerns and helping them prepare for a strong recovery,” Tim Sullivan, the NJEDA’s chief executive officer, said in a Monday statement.
The first leg of the agency’s grant program included two rounds of $5 million each, capped at $5,000 per business. The second go of funding, at $45 million, included grants up to $10,000.
The agency’s second round of grant funding saw more than 20,000 applicants in a four-hour period last month, and 31,000 in total. As many as half of them might not get any grant money, NJEDA officials cautioned.
As of July 24, the NJEDA awarded nearly $11 million to 3,383 businesses under the first round and nearly $23 million to 7,032 under the second round, according to its most recent activity reports.
On average, the grants sized in at $3,000 per business.
Meanwhile, as of its Monday statement, the NJEDA said it closed on 76 loans totaling $5.1 million.
Under the loan program, businesses with less than $5 million in yearly revenue can borrow up to $100,000, which doesn’t have to be paid back for 10 years – the first five of which are interest-free.
Under an aid program meant to keep investments going into startups during the pandemic, and take the risks out of those investors’ hands, the NJEDA went through roughly a third of its $5 million pot of money for the NJ Entrepreneur Support Program. Eligibility is limited to businesses with less than 25 employees and up to $5 million in revenue. Loan guarantees are up to 80 percent, capped at $200,000 per startup, meaning the NJEDA would effectively use up to that amount as collateral against the loan.
As of Monday, $1.7 million of guarantees had been approved for investments into 12 companies.
Another program, known as the “[Community Development Financial Institutions] Initiative,” includes NJEDA grants into six separate local-level banks, so they can offer lower-cost financing to an array of small businesses.
As of Monday, those six banks lent out $3.6 million to 121 separate small businesses, the NJEDA said, with plans for them to lend out up to $30 million.