In response to the economic struggles small businesses are facing during the COVID-19 health crisis, the New Jersey Economic Development Authority (NJ EDA) has developed an Economic Relief Package that includes a Small Business Emergency Assistance Loan Program. The application is currently available for review: Application for Small Business Emergency Assistance Loan Program. However, applications cannot be submitted until Monday, April 13, 2020 at 9:00 a.m.
The Small Business Emergency Assistance Loan program will provide direct loans of up to $100,000 to New Jersey-based small businesses and non-profit organizations that have, among other requirements, been in existence for at least one (1) year, have less than $5 million in annual revenue and have been negatively impacted by the COVID-19 outbreak. Examples of negative impacts from the COVID-19 outbreak that will be considered include a reduction of business hours, the complete closure of the business, at least a 20% decline in revenue, impacts associated with employees unable to work, businesses required to close by government order, and disruption of the business’ supply chain. Non-profit organizations organized under Internal Revenue Code sections 501(c)(3), 501(c)(4), and 501(c)(7) are eligible for this program.
The NJ EDA identified the following factors in assessing eligibility for the Emergency Assistance Loan Program:
• Having a physical commercial location in the State of New Jersey. (Home-based businesses are not eligible for this program. A home-based business is a business operated out of a residential property where commercial activity is not zoned to take place.)
• Having been in existence for at least one (1) year.
• Having less than $5 million in annual revenue.
• Being able to show a global debt service coverage ratio of 1.00 (as of December 31st, 2019).
• Being able to demonstrate that the business experienced a negative impact related to COVID-19 on or after March 9th, 2020.
• Being registered to do business in the State of New Jersey.
• Certifying that the company is in good tax standing with the State.
• Being in good standing with the Department of Labor and Workforce Development. (All decisions about whether a business is in good standing will be at the discretion of the Commissioner of the Department of Labor and Workforce Development.)
• Being able to provide a CEO certification affirming that the business will make its best effort not to lay off employees or will re-hire employees as soon as possible.
This summary is for informational purposes only and is not intended to constitute legal advice. This information may not be reused or published without prior permission from KSBranigan Law.