Gov. Phil Murphy announced Friday the state is committing $50 million in federal CARES Act funding to directly support small businesses impacted by COVID-19 through the New Jersey Economic Development Authority.
Murphy said the funds primarily will be used to provide grants.
The EDA had a previous grant program, which — despite the fact that it had limited eligibility and only $5 million in grants available — was oversubscribed within hours of its opening.
Tim Sullivan, the CEO of the EDA, said details of a new program are still being worked out, but he told ROI-NJ that his group is likely to propose the following at a special EDA board meeting that will take place toward the end of next week:
- Take some portion of the $50 million and give it to the backlog of applications that were not fulfilled in the EDA’s first grant program.
Those who did not receive money in that program were told they were either in line if future funding becomes available or not likely to receive future funding, Sullivan said.
“We will notify everyone who applied in the first round,” Sullivan said. “They will get a notification one way or another.
“There was a group of folks who were told they were on the ‘wait list’ and others who were told they were not likely to receive funding in an additional round. Either way, everyone will be notified.”
Sullivan said the application should take 10-15 minutes to process, so he did not feel it would be too much of a strain to ask those who are not pulled off the “waiting list” from the first program to apply again.
- Make sure the new program has broader eligibility.
To be eligible for the first program, a business had to have fewer than 10 employees. In addition, sole proprietorships, home-based businesses and many industries were ineligible.
“This time around, we’ll be much broader,” Sullivan said. “And we’ll likely reserve some of the funds for Opportunity Zone tracts to make sure we have a better mix of diverse companies.”
Sullivan said many companies who applied in the first round were not eligible. He said the EDA will work to correct that — and expand access — this time around.
“I think that’s a fair thing to do,” he said.
Murphy said the funding is a way for the state to help small business, a pledge he has made from the beginning.
“We know that many businesses have had very real concerns about their ability to survive this pandemic, and we all fully appreciate and recognize those concerns,” he said. “To the extent that we can use this federal funding to help our small businesses not just make it through, but to see them thriving again as we continue our restart, we will take those steps.
As I said, our small businesses are the heart of our economy. They are, collectively, the largest employer of our fellow residents. And, their health is critical to our state’s economic health.”