Provides Much Needed Funds to Expand Small Business’ Employment
TRENTON – Legislation sponsored by Senator Jim Whelan and Senator Paul A. Sarlo which would create a “Small Business Loan Program” to provide low interest loans to small businesses that commit to increase their workforce was approved today by the full Senate.
“Small businesses have been hit hard during this recession and it is increasingly difficult for many of them to find financing options,” Senator Whelan (D-Atlantic) said. “The ‘Small Business Loan Program’ will provide low-interest loans to businesses that want to expand, creating new jobs and stimulating economic growth.”
The bill (S-3052) would direct the New Jersey Economic Development Authority (EDA) to establish the “Small Business Loan Program” and provide two percent or lower interest loans of up to $250,000 to New Jersey small businesses who commit to increase their employment levels by at least 10 percent within the next four years. These loans can be used for capital purchases, employee training and salaries for new positions.
“We need to get New Jerseyans back to work. Unemployment is stuck over nine percent and the ‘Small Business Loan Program’ would help small businesses expand and create new jobs and opportunities for New Jersey’s unemployed,” Senate Sarlo (D-Bergen, Essex and Passaic) said. “By increasing their workforces by 10 percent, these businesses will have a real hand in improving our economy.”
In order to be eligible, the small business must:
• Be independently owned and operated;
• Be for-profit with a place of business located in the State;
• Be primarily operated within the State;
• Not be dominant in its field;
• Employ less than 100 full-time employees
• Have not raised $10 million or more in equity financing; and
• Have not received $10 million or more in financing from any source.
In order to implement this program, the EDA would establish a “New Jersey Small Business Loan Fund” that could be credited with existing EDA funds, which would be self-sufficient and revolving based on loan repayments and fees and therefore would not require the State to incur any cost.
The bill now heads to the Assembly for consideration.