The response shocked the NJEDA April 3, as businesses claimed the available $5 million almost as soon as it became available. The application remains open until Friday, April 10, though, and NJEDA encourages businesses who have not applied to still do so. Submitting an application will ensure that the applicant would be eligible if additional funds became available for this round of grant funding.
The program provides 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.
The NJEDA board approved the grants and other new programs March 26 with the intention of supporting businesses and workers facing economic hardship due to the outbreak of the novel coronavirus COVID-19.
The initiatives include a zero-interest loan program for midsize companies, support for private-sector lenders and Community Development Financial Institutions, funding for entrepreneurs, and a variety of resources providing technical support and marketplace information. NJEDA said the initiatives will support between 3,000 and 5,000 small and midsize enterprises and are meant to complement recently announced federal economic recovery initiatives.
The new NJEDA initiatives focus on businesses that have been hit hardest by the novel coronavirus outbreak: local small businesses, midsize businesses that have had to close or drastically reconfigure operations, and new businesses who were just getting on their feet before the crisis hit. The programs provide a suite of compatible offerings that address these businesses’ varied needs and include mechanisms to provide funding and assistance as quickly as possible.
Many of the resources are designed to be scalable with the addition of federal and philanthropic resources if they become available. Philanthropic partners interested in donating to support the NJEDA’s small business grant program can send email to firstname.lastname@example.org.
The remaining initiatives include:
A $10 million Small Business Emergency Assistance Loan 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 zero percent for the first five years, then resetting to the EDA’s prevailing floor rate (capped at 3.00%) for the remaining five years.
A $10 million Community Development Finance Institution Emergency Loan Loss Reserve Fund to take a first loss position on CDFI loans that provide low interest working capital to micro businesses. 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.
A $1.25 million CDFI Emergency Assistance Grant 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.
A $5 million NJ Entrepreneur Support Program that will encourage continued capital flows to new companies, often in the innovation economy, and temporarily support a shaky market by providing 80 percent loan guarantees for working capital loans to entrepreneurs.
A $10 million Small Business Emergency Assistance Guarantee Program that will provide 50 percent guarantees on working capital loans and waive fees on loans made through institutions participating in the NJEDA’s existing Premier Lender or Premier CDFI programs.
A $150,000 Emergency Technical Assistance Program that will support technical assistance to New Jersey-based companies applying for assistance 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.
For more information about NJEDA resources, call (609) 858-6767.
For full details on eligibility about NJEDA programs, go online to cv.business.nj.gov.