(TRENTON) – Legislation Assembly Democrats Daniel R. Benson, Gordon Johnson and Speaker Craig Coughlin sponsored to encourage job creation and business development in small, highly-developed municipalities was advanced Monday by an Assembly panel.
The bill (A-2441) would establish the “Main Street Economic Growth Program” in the New Jersey Economic Development Authority (EDA) to provide financial and technical assistance to a business located in a Main Street area within a small municipality. The bill hopes to encourage business development in small municipalities with substantially developed commercial areas.
“Many small municipalities with substantially developed commercial areas face considerable obstacles in fostering new jobs and business growth,” said Benson (D-Mercer/Middlesex). “Making matters worse, they often do not qualify for assistance offered by the state’s municipal and business assistance programs. It’s in the long-term economic interest of this state to establish an economic development incentive program to encourage business growth in these smaller municipalities.”
“A thriving business community is vital to the economic well-being of a municipality,” said Johnson (D-Bergen). “This bill helps provide the type of assistance that is often unavailable to smaller municipalities. Helping these communities thrive not only helps the local economy, but the state.”
“Businesses are an integral part of any community and should be supported,” said Coughlin (D-Middlesex). “With this bill, the local economy of these municipalities will grow and prosper.”
The bill would authorize the governing body of a municipality having a population of less than 11,000 that is more than 70 percent developed to designate a “Main Street area” in the municipality. In designating a “Main Street area,” the governing body would set forth findings on the economic conditions existing in the area and the municipality’s intentions for addressing them.
For a business to be eligible to receive financial and technical assistance from the Economic Development Authority under the program, at least 25 percent of full-time employees of the business must reside within the municipality.
Under the bill, the EDA must work cooperatively with other state agencies to explore and implement opportunities to direct resources and create enhanced incentives for area businesses participating in the program.
The bill provides corporation business tax credits and gross income tax credits for businesses located in a Main Street area within a small municipality that meet the criteria and participate in the program as determined by the EDA. The credits are equal to 15 percent of the cost of employee compensation expenses related to meeting the employment criteria under the definition of an area business under the bill.
To provide funding for the program, the EDA is to create the “Main Street Economic Growth Assistance Fund” for the purpose of providing loans, loan guarantees, and technical assistance to area businesses located within a small municipality. The terms of a loan or loan guarantee and the amount of technical assistance is to be at the discretion of the authority based on the monies made available by the authority for the purposes of the fund. The EDA may make monies available for the purpose of the fund from monies received by the EDA from any public or private sources.
The bill requires the EDA to issue an annual report to the governor and legislature on the program and to adopt rules and regulations to implement the program.
The measure was advanced by the Assembly Commerce and Economic Development Committee.