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NJ ECONOMIC DEVELOPMENT AUTHORITY RESOURCES Partnership for Action Lt. Governor Kim Guadagno EDA Results 2013 Activity 220 Economic Development Projects Assisted $1.29 Billion EDA Financing Assistance, Business Incentives and Tax Credits $2.7 Billion Total Public/Private Investment 9,588 Construction Jobs Created 5,432 New Permanent Jobs Created 5,262 Retained Jobs “At Risk” of Leaving New Jersey Premier Lenders • The EDA partners with 35 Premier Lender banks to offer low-cost financing opportunities through a variety of small business lending programs. • Premier Lending status allows EDA’s banking partners to be more responsive to the needs of New Jersey businesses through a streamlined loan approval process. • The EDA reviews finance applications within five days, allowing for an expedited flow of capital to growing businesses in the state. • Quick turnaround time from approval to closing provides a strong incentive for borrowers, while the EDA’s exposure by participating in or guaranteeing a portion of a loan reduces the lender’s risk. Premier Lender Program IF YOU ARE: A New Jersey-based business that creates or maintains jobs for every $65,000 of EDA Assistance AVAILABLE ASSISTANCE: Your financial institution can request a participation, guarantee or line of credit guarantee through the EDA. TO BE USED FOR: Fixed assets and permanent working capital. MAXIMUM AMOUNTS: EDA can participate in or guarantee up to 50% of a bank loan or line of credit. The maximum EDA exposure is: Fixed Assets Loan: $2 million Guarantee: $1.5 million Total Exposure: $2.75 million Working Capital Loan: $750,000 Guarantee: $1.5 million Total Exposure: $2.25 million Line of Credit Guarantee Up to $750,000 Fees: $1,000 Application fee, $750 commitment fee and $75 Tax clearance fee Tipico Products Co. was formed in 1980 as a wholesaler of cheese. The company operates from a 46,000-square-foot facility in Lakewood with 98 employees. Tipico is purchasing the property to support business expansion; the company expects to create 30 new jobs within two years. An EDA Premier Lender approved a $2.85 million mortgage to partially fund the purchase of the property. The loan was contingent upon a $1.25 million (43.86%) EDA participation. “The talented professionals at the EDA and Bank managed to assemble a detailed financing package in a very short time frame, which helped Forman Industries continue to grow in Old Bridge. We are extremely pleased to be able to maintain our growth in New Jersey.” -Scott Forman, founder, Forman Industries EDA 2013 Annual Report When Forman Industries wanted to refinance so that it could enhance its operations in Old Bridge, the retail construction services provider turned to the Statewide Loan Pool Program. Premier Lender Bank approved the company for a loan that included a $720,000 (50%) EDA participation. Small Business Fund IF YOU ARE: A creditworthy small, minority-owned or womenowned business in New Jersey in operation for at least one year or not-for-profit corporation in operation for at least three full years. YOU MAY QUALIFY FOR: • Small Businesses - Up to $500,000 for credit scores greater than or equal to 680 and 1:1 debt service coverage ratio. • Not-for-Profits - Up to $500,000 with 1:1 debt service coverage ratio. TO BE USED FOR: Fixed assets and working capital Dataline, Inc. is a Princeton-based consumer marketing information company that received a $900,000 working capital line of credit from an EDA Premier Lender that included a one-year, $350,000 Authority guarantee. The company expects to add three new employees to its existing staff of 15. Aurora Multimedia Corporation (AMC) utilized a $335,000 term loan from an EDA Premier Lender with a 50% Authority participation, and a $350,000 line of credit backed by a 50% EDA guarantee. The Morganville-based company manufactures building control systems, touch panels and video wall processors and expects to retain its staff of 25 and create 10 new jobs. AEON Corporation is a woman-owned photonic semiconductor manufacturer located in Princeton Junction. The company received a 7-year, $200,000 EDA direct loan, with interest only payments for the first 12 months (3.26% for the first 5 years) to support its expansion. American Trading International (ATI) used a $2.97 million Premier Lender bank loan with a $970,000 EDA participation to purchase and renovate a 130,000-square-foot property in Newark. The company develops recycling plans for companies with post-industrial and post-consumer plastics. The expanded property will allow ATI to create efficiencies, install loading docks and add 20 employees. Bond Financing IF YOU ARE: A creditworthy manufacturing company, a 501(c)(3) not-for-profit organization, or an exempt facility in New Jersey, YOU CAN APPLY FOR: Long-term financing under the Bond Financing Program. IN THE AMOUNT OF: • $500,000 to $10 million in tax-exempt bonds for for-profit companies, with either a fixed or variable interest rate, and terms up to 20 years for real estate and 10 years for equipment; • $500,000 with no dollar limit in tax-exempt bonds for qualified not-for-profit organizations. Bond Financing Eligible Uses: • Tax-exempt bonds for eligible for-profit companies can be used to finance capital improvements and expansions, including real estate acquisitions, new equipment, machinery, building construction, and renovations. • Tax-exempt bonds for not-for-profits seeking capital to expand community services can be used to finance land and building acquisitions, new construction and renovations, equipment purchases, debt refinancing and working capital. • Government tax-exempt bonds can be used for projects that are owned and operated for the benefit of local, county and state government bodies. • Taxable bonds may be used for working capital and debt refinancing, and are permitted only under certain circumstances for tax-exempt financing for not-for-profit borrowers. • Superior Powder Coating, Inc., an Elizabeth-based metal finisher, received an $827,826 tax-exempt bond to purchase new manufacturing equipment, as well as a $750,000 direct loan for working capital and to refinance existing loans. The bonds were directly purchased by TD Bank. The company expects to add 16 new positions to its existing staff of 139. • The Village Charter School, Inc. received a $6 million tax-exempt bond to acquire the facility it currently operates out of in Trenton. The 47,000-square-foot building is located on 10 acres and serves 360 students in kindergarten through the 8th grade. The Village Charter School, which leases the space from Mercer Street Friends, opened in 1999 and graduated its first 8th grade class in spring 2006. Economic Opportunity Act of 2013 Summary The New Jersey Economic Opportunity Act of 2013 merges the State’s economic development incentive programs with the goal of enhancing business attraction, retention and job creation efforts and strengthening New Jersey’s competitive edge in the global economy. The Grow New Jersey Assistance Program (Grow NJ) is now the main job creation incentive program and the Economic Redevelopment and Growth Program (ERG) is the State’s sole redeveloper incentive program. Both programs have been expanded and will sunset July 1, 2019. Grow NJ ERG Base tax credits ranging from $500 to $5,000 per job, per year Expands geographic boundaries, reduces cap. investment and employment eligibility Bonus credits to drive development in certain areas Increases State and local incentive grant from 20% to 30% of total project cost (40% in certain locations) Tax credits allocated for residential projects Bonus awards to incentivize targeted redevelopment goals Margie Piliere Director of Business Banking [email protected] 609-858-6877 Monika Athwal Business Development Officer (North) [email protected] 973-855-3451 David Lawyer Director of Credit Underwriting [email protected] 609-858-6753 Derrick Benns Sr. Business Development Officer (South) [email protected] 856-361-2742 Tejinder Gill Sr. Business Development Officer (Central/North) [email protected] 609-858-6897 Partnership for Action: Choose New Jersey (609) 297-2200 www.choosenj.com New Jersey Business Action Center (866) 534-7789 www.NewJerseyBusiness.gov New Jersey Economic Development Authority (609) 858-6700 www.njeda.com