New Jersey Assembly Bill A2185

New Jersey 2024-2025 Regular Session

• Introduced: 1/9/24
• Refer: 1/9/24

Caption

Establishes Urban Enterprise Zone Microloan Program in EDA to help certain businesses in Urban Enterprise Zones and UEZ-Impacted districts; appropriates $5 million.

Impact

The Urban Enterprise Zone Microloan Program will provide low-interest loans at rates not exceeding three percent for eligible businesses, and at zero percent for veteran-owned enterprises. These loans can be issued for terms of up to six years, with repayments not commencing until one year after approval. The intention of these provisions is to attract new businesses to areas that could particularly benefit from economic revitalization and to promote job creation, enhancing community engagement within these zones.

Summary

Bill A2185 establishes the 'Urban Enterprise Zone Microloan Program' within the New Jersey Economic Development Authority (EDA) to provide financial assistance to qualified businesses in urban enterprise zones and UEZ-impacted districts. The program aims to facilitate the operational and capital expenses necessary for setting up new businesses in designated areas that face economic distress. To support this initiative, the bill appropriates $5 million from the General Fund for the establishment of a revolving loan fund that will help maintain the program's sustainability.

Contention

Despite the program's noble intentions, there are potential points of contention regarding the eligibility criteria for businesses. For instance, to qualify, businesses must engage in a viable trade and employ at least five individuals predominantly from the community for at least 24 months. Critics may argue that these stipulations could disqualify numerous small initiatives that lack the benchmarks set forth, thereby limiting the support to more established businesses. Moreover, questions surrounding loan forgiveness provisions and accountability might arise, particularly in terms of ensuring proper reporting and deployment of funds without mismanagement.