New Jersey Offers Emergency Grants to Small Businesses

After pre-registration closes at 5 p.m., the application window for eligible small businesses opens in three phases. Applications open for restaurants at 9 a.m. on Thursday, October 29, 2020. Applications open for micro businesses at 9 a.m. on Friday, October 30, 2020. Finally, applications will open for all other eligible businesses at 9 a.m. on Monday, November 2, 2020.

Awards will range from $5,000 to $20,000. Applications for each category will be open for a period of one week and accepted on a first-come, first-served basis. After two previous rounds of grants, the New Jersey Economic Development Authority (NJEDA) is administering the program using $70 million in additional funding from the Coronavirus Relief Fund.

New Jersey’s Small Business Emergency Assistance Grant Program

The purpose of the program is to provide short-term payroll and working capital support to New Jersey small businesses negatively impacted during the state of emergency. The goal is to stabilize small business operations and minimize the potential for employee furloughs and layoffs.

Under the initial phase of the program, eligibility was restricted to businesses with no more than 10 full-time employees (FTEs). In Phase 2, the employee eligibility cap was increased to no more than 25 FTEs. In Phase 3, the employee eligibility cap is increased again to no more than 50 FTEs.

Funding from the program may be used for reimbursement of lost revenue as a result of business interruptions caused by COVID-19. Funding may not be used for capital expenses, including construction.

Eligible businesses must have a physical commercial location in the State of New Jersey (for example, an office, a physical point of sales, a warehouse, manufacturing facility, etc.). Home-based businesses must be located in New Jersey. All non-profit entities organized under Internal Revenue Code section 501(c) are eligible, except for organizations whose primary activity is political lobbying.

Businesses approved for grant funding under Phase 1 or Phase 2 of the Small Business Emergency Assistance Grant Program are eligible for Phase 3 funding. Funding received in Phases 1 or 2 will not directly impact the award sizes that these businesses are eligible to receive in Phase 3, except to the extent that prior grants reduced the business’s unmet need.

The NJEDA will review applications on a first-come, first-served basis based on the date and time completed applications are submitted. The NJEDA may re-open pre-registration on November 10, 2020, and may re-open the application on November 17, 2020, in the event funding remains available.

New Jersey Small and Micro Business PPE Access Program

New Jersey small businesses may also be eligible for discounted personal protective equipment (PPE). Under the New Jersey Small and Micro Business PPE Access Program, small businesses may receive a discount on PPE required to protect employees and customers.

The PPE Access Program has been structured to provide $20.4 million in grant funding to cover 25% of eligible small businesses or non-profit’s PPE purchases through the Designated Vendors PPE Access Program sites. The 25% discount is capped per organization, per round of the program. Generally, the cap is $400; however, up to $500 is permitted for organizations in opportunity zone eligible census tracts.

New Jersey Expands Travel Advisory

On October 20, 2020, New Jersey re-added Arizona and Maryland to their travel advisory list. These additions bring the total up to 39 states. Individuals traveling from these states are strongly urged to quarantine for 14 days. According to official guidance, compliance is voluntary but expected.

New Jersey’s travel advisory may complicate staffing decisions for employers. Under the Jersey Earned Sick Leave Law, eligible employees who have worked for their employer for at least 120 days may use earned sick leave accrued under the law when the employee undergoes isolation or quarantine.

Under the New Jersey Family Leave Act, eligible employees may also take job-protected leave from work when a health care provider or public health authority recommends that a family member in need of care by the employee voluntarily undergoes self-quarantine.

Key Takeaways

New Jersey small businesses should act quickly to pre-register for Phase 3 of the Small Business Emergency Assistance Program before the window closes on October 27, 2020, at 5 p.m.

Updated COVID-19 related guidance for New Jersey businesses is available here and updated on a regular basis.

The Coronavirus Task Force at Klehr Harrison stands ready to assist you in your business and legal needs. We will continue to provide additional information and guidance as the COVID-19 situation develops.