The U.S. Small Business Administration approved New Jersey’s bid for “disaster” status, meaning thousands of businesses across the state slammed by the coronavirus outbreak can receive federal aid to avoid going belly up.
New Jersey’s approval means businesses can apply for federal disaster loans of up to $2 million, with interest rates capped at 3.5 percent, for the inevitable economic injury they will suffer as a result of the COVID-19 outbreak, the SBA said.
Gov. Phil Murphy’s office confirmed the state’s application with the SBA cleared. Businesses can indicate they suffered losses as a result of the outbreak in order to qualify for the program, officially known as the Economic Injury Disaster Loans.
Earlier this week, Murphy ordered the closure of virtually all non-essential retail operations, as well as any business where more than 50 people congregate – including malls, dine-in restaurants, bars, theaters and casinos.
He also enacted a voluntary curfew between 8 p.m. and 5 a.m. for all non-essential travel, but has not ruled out making that mandatory. Nor has he ruled out a “shelter-in-place” order.
“You can’t do what we have done and not have a dramatic impact on, not just people’s lives, but on the health of the state’s budget and revenues,” the governor said at a coronavirus daily press briefing on March 18.
A pair of surveys this week – one from the New Jersey Chamber of Commerce and another from the New Jersey Business & Industry Association – found that many employers were considering scaling back hours and reducing staff as a result of the pandemic. And on Monday alone, a surge of 15,000 applications for unemployment insurance caused the labor department’s online system to briefly crash, with many residents indefinitely out of work.
A series of bills being fast-tracked through the state Legislature would open up state aid for many of these businesses.
“It’s unfortunate that we must take these aggressive measures of social distancing but it’s the only way we can flatten the curve and slow the spread of COVID-19,” U.S. Sen. Robert Menendez, a Democrat from New Jersey, said in a Thursday morning statement.
The state’s Congressional delegation – made up of two Republicans and 12 Democrats – has pushed the Trump administration for more federal aid to Trenton, be it a multibillion-dollar bailout for New Jersey in response to gaping holes in its budget, or for the U.S. Army Corps of Engineers to construct short-term hospitals for handling the widely expected surge of coronavirus patients.