A bipartisan group of lawmakers want to allocate $300 million to fund emergency loans and grants to help New Jersey’s small businesses and non-profit organizations struggling to stay afloat amid the ongoing COVID-19 pandemic.
Under S-3457, introduced Feb. 11, the aid would be funneled to impacted businesses and organizations through the New Jersey Economic Development Authority (NJEDA).
Support would be available to entities that lost revenue due to pandemic-related shutdowns and slowdowns caused by state-mandated restrictions, as well as those whose reopening plans were disrupted.
Speed Up Economic Recovery
The legislation builds upon a Republican-sponsored bill, S-3210, that was introduced in November 2020 and was ultimately tabled.
Now a bipartisan measure, the new bill’s backers include State Senate President Steve Sweeney (D-3), along with State Sens. Dawn Addiego (D-8), Vin Gopal (D-11), Declan O’Scanlon (R-13), Michael Testa (R-1) and Tom Kean, Jr. (R-21).
Following its introduction, Sweeney said, “This $300 million investment will speed up our economic recovery from the pandemic, prevent more businesses and non-profits from closing and create jobs for workers who have been on the unemployment rolls for almost a year.”
Small Businesses Take A Hit
In the Garden State, the number of small businesses that are open declined 43.8% since January 2020, just before the pandemic broke out, according to TrackTheRecovery.org, a Harvard-run database that keeps tabs on the pandemic’s economic impact.
Over the past year, the state’s overall employment rate dropped 7.4% and more than 2 million residents have filed job loss claims.
New Jersey’s small business community and non-profit groups have “been forced to fight for scraps through a patchwork of underfunded state relief efforts,” said Testa. “It hasn’t been enough.”
Increasing funding for emergency grants and loans “is a major step in the right direction,” Testa said.
Main Street ‘Begging For Help’
The proposed aid will be particularly critical for New Jersey’s hard-hit restaurant, hospitality and tourism industries, Gopal said.
“These businesses are going to need help when they try to ramp up to full operation again in what is bound to be an uncertain economy as we come out of the pandemic,” he said.
Michele Siekerka, president and chief executive officer of the New Jersey Business & Industry Association (NJBIA), said that while the arrival of the COVID-19 relief package “is good news (it) signals only the beginning of the end of this long nightmare.”
O’Scanlon said, “After nearly a year of operating restrictions, our restaurants and Main Street shops are barely staying afloat. They’re begging for help.”
Assembly Action Needed
Senate Republican Budget Officer Steven Oroho (R-24) praised the bill’s introduction, but said, “We still need the General Assembly and the Murphy Administration to get on board for the legislation to advance and be enacted.”
“With state revenues almost certain to beat expectations this year and the likelihood New Jersey will receive billions more in the next federal relief package, there’s no legitimate argument that we can’t afford this legislation,” the Sussex County Republican said.
Kean urged the Assembly and Gov. Phil Murphy to advance “this critically important initiative,” saying, “there’s no budgetary reason to oppose it.”
More Support Needed
A new survey from the Heldrich Center for Workforce Development at Rutgers University found that many struggling small business owners secured some type of aid during the pandemic, with 67% securing funding through the federal Paycheck Protection Program and 47% receiving help via NJEDA grants.
So far, the NJEDA has provided 20,000 businesses with $74.2 million in relief, while the Paycheck Protection Program gave $15.8 billion in loans to 142,000 businesses last spring and summer.
But business owners are asking for more support going forward to avoid bankruptcy, closing up shop and adapting. According to the survey, 83% expect to lose significant revenue in the next three to six month.
“New Jersey businesses and non-profits may need months or even years to regain their financial footing in the aftermath of COVID-19,” said NJBIA’s Siekerka. “We ask our policymakers to listen to what our businesses and non-profits are saying.”