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 by the Senate Budget and Appropriations Committee by a unanimous vote.
“By providing low interest loans to small business throughout the State, we can start to stimulate the economy and put New Jerseyans back to work,” Senator Whelan (D-Atlantic) said. “Businesses need access to capital to start, grow and expand their enterprises. If we can help them to obtain low-interest loans, our small businesses can hire and expand their workforce and put our unemployed men and women back on the job.”
The bill (S-3052) would direct the New Jersey Economic Development Authority 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.
“In order to improve this economy for both businesses and working class New Jerseyans, we must take steps to improve our business climate and create jobs. ‘The Small Business Loan Program’ is one such step,” Senator Sarlo (D-Bergen, Essex and Passaic) said. “A small interest loan is a real incentive for businesses that are looking to expand and grow in this difficult 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 Senate for full consideration.