TRENTON – Legislation sponsored by Senator Jim Whelan that would establish the Main Street Economic Growth Program to encourage business development in municipalities having small populations with substantially developed commercial areas cleared the Senate Economic Growth Committee today.
“This bill is about creating economic development incentive programs for smaller municipalities that have great potential to create local jobs and promote business growth but are faced with considerable challenges or don’t qualify for assistance under the State’s existing programs,” said Senator Whelan (D-Atlantic). “Providing these incentives will prove beneficial in the long-term for the growth of local economies across New Jersey.”
Under the bill, S-892, the program would be established in the New Jersey Economic Development Authority (EDA) for the purpose of providing financial and technical assistance to businesses located in a Main Street area within a small municipality, defined as having a population under 10,000 and which is over 85 percent developed.
For a business to be eligible to receive financial and technical assistance from the EDA under the program, at least 25 percent of its full-time employees would be required to reside within the municipality. Under the bill, the EDA would be required to work cooperatively with other State agencies to explore and implement opportunities to direct resources and create enhanced incentives for area businesses participating in the program.
The bill also provides corporation business tax credits and gross income tax credits for businesses located in a Main Street area within a small municipality that meet the criteria and participate in the program. The credits are equal to 15 percent of the cost of employee compensation expenses related to meeting the employment criteria under the definition of an area business under the bill.
Eleven municipalities in Senator Whelan’s district, the 2nd Legislative District, that would meet the criteria as established by this bill are: Absecon, Brigantine, Buena, Buena Vista, Egg Harbor City, Folsom, Linwood, Longport, Margate City, Mullica and Northfield.
“Stronger local businesses support and empower local economies,” added Senator Whelan. “Our goal is to drive economic growth on the local level, creating jobs and promoting a greater sense of community on ‘Main Street,’ which will in turn support the overall economic health of New Jersey.”
Under the bill, the EDA would create the “Main Street Economic Growth Assistance Fund” to provide loans, loan guarantees, and technical assistance to area businesses located within a small municipality. The terms of a loan or loan guarantee and the amount of technical assistance would be at the discretion of the EDA.
The EDA would also be required to issue an annual report to the Governor and Legislature on the program and to adopt rules and regulations to implement the program under the bill.
The bill cleared the Senate Economic Growth Committee with a vote of 4-0. It now heads to the Senate Budget and Appropriations Committee for consideration.