TRENTON – Applications are now available online from the New Jersey Economic Development Authority (EDA) for $170 million in financing assistance to help state businesses face the fiscal challenges of the national economic crisis. The funding is being made available through two new programs created under Governor Jon S. Corzine’s Economic Assistance and Recovery Plan to stimulate capital investment and job creation.
“In creating the InvestNJ and Main Street Business Assistance programs, the Governor and the Legislature have taken critical steps to support business growth and community investment in New Jersey and help our state emerge from a national economic recession,” said Jerold L. Zaro, chief of the Office of Economic Growth.
“Early interest in these initiatives has been strong, and we expect this interest to grow as more businesses become familiar with what the new programs offer,” said Caren S. Franzini, chief executive officer of the EDA, which is administering both programs.
The $120-million InvestNJ program includes two components. One offers a $3,000 grant to New Jersey businesses for each new job created and retained for one year. This component will provide up to $50 million, not to exceed $500,000 per grantee, for each eligible position created after Dec. 1, 2008 and before Jan. 1, 2011 by qualified businesses that experience a net increase in employment of eligible positions in the state during the same 12 consecutive months.
Another element of the program authorizes the payment of grants equal to seven percent of a business’s qualifying capital investment of at least $5,000 made prior to Jan. 1, 2011. Up to $70 million is available for capital investment grants, not to exceed $1 million per grantee, to fund expenses for the direct use and operation of a business.
To take advantage of the job creation grant component of InvestNJ, a business must have operated continuously in New Jersey for at least the prior two years, and must have at least five full-time eligible employees. To benefit from the capital investment grant, businesses must have operated continuously for at least the prior two years and have at least five full-time employees. Other qualifying factors for both programs can be found at www.njeda.com.
The Main Street Business Assistance Program also has two parts – a loan participation and/or guarantee product that is being offered through participating banks and a line of credit guarantee offered through the EDA’s 14 Preferred Lender partners. To qualify, borrowers must be in business at least two years, maintain jobs in New Jersey and meet other EDA eligibility requirements.
For term loans secured by fixed assets like buildings and equipment, the EDA will provide a maximum participation of 25 percent, or $1 million, in a bank loan and a maximum bank loan guarantee of 50 percent, up to $2 million. For working capital loans to cover operating expenses, the EDA will provide up to 25 percent of a bank loan, not to exceed $750,000, and a maximum guarantee of 50 percent, up to $1.5 million. The aggregate EDA exposure cannot exceed 50 percent of the total bank loan amount to a total maximum of $2 million. The interest rate on EDA loan participations are fixed at 5 percent for a maximum of five years. Borrowers also can use the Main Street program to refinance higher-interest debt.
The line of credit guarantee, which can be used for fixed assets or working capital, will be set at a maximum of 50 percent of the bank amount, up to a maximum of $250,000.
Applications and more details on both programs are available at http://www.njeda.com. For more information on InvestNJ, you may also call 1-(800) 537-7397 or e-mail ServiceCenter@njeda.com. Additionally, you can get more information on the Main Street Business Assistance Program by calling 1-(800) 537-7397 or sending an e-mail to MainSt@njeda.com.