LEGISLATIVE FISCAL ESTIMATE
[Second Reprint]
ASSEMBLY, No. 4971
STATE OF NEW JERSEY
221st LEGISLATURE
DATED: JUNE 26, 2025
SUMMARY
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Synopsis: |
Requires EDA to provide grants to certain small businesses affected by State infrastructure and construction projects. |
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Type of Impact: |
Annual State expenditure increase. Potential State revenue increase. Potential local expenditure increase. |
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Agencies Affected: |
New Jersey Economic Development Authority. |
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Office of Legislative Services Estimate |
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Fiscal Impact |
Annual |
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State Expenditure Increase |
Indeterminate |
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Potential State Revenue Increase |
Indeterminate |
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Potential Local Expenditure Increase |
Indeterminate |
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· The Office of Legislative Services (OLS) determines that annual State expenditures will increase by an indeterminate amount, for the New Jersey Economic Development Authority to establish, administer, and award grants for small businesses that have suffered economic loss due to an extended closure as a consequence of prolonged infrastructure or construction projects undertaken by the State or another public entity.
· Annual State costs cannot be determined because these costs will depend on program demand and any funding made available for the program through future appropriations made by the Legislature.
· The State, counties, and local entities may potentially experience additional expenditure increases if a State, county, or local entity is responsible for the prolonged infrastructure or construction project and is required to contribute up to five percent of the estimated total project costs as outlined in the bill.
· The State may realize additional revenue from application fees collected from grant applicants. The OLS is unable to quantify these potential revenue increases because the amount of potential application fee collections cannot be determined at this time.
BILL DESCRIPTION
This bill requires the authority to establish a Small Business Interruption Grant Program to provide grants to support small businesses that have suffered economic loss due to an extended closure as a consequence of prolonged infrastructure or construction projects undertaken by the State or another public entity. The bill requires the authority to develop an application by which a small business may apply for a grant, award grants to small businesses subject to availability of funds, administer the grant program, and establish and maintain a Small Business Interruption Grant Program Fund to provide grants to small businesses that participate in the program. The bill requires the authority to determine program grant amounts based on operating expenses incurred by a small business due to an extended closure as a consequence of a prolonged infrastructure or construction project, rather than on the amount of actual or projected revenue loss as a result of closures or declines in business.
A small business would be eligible to apply for a grant under the bill for suffering an economic loss due to prolonged infrastructure or construction projects which occurred either before or after the bill’s effective date. Under the bill, the amount of any grant awarded to a small business is to be determined by the authority based on the amount of actual or projected revenue loss as a result of closures or declines in business due to a prolonged infrastructure or construction project.
Additionally, this bill requires the entity responsible for the prolonged infrastructure or construction project to contribute to the fund established by the bill, at most, an amount equal to five percent of the estimated total project costs to support small businesses that suffer economic loss due to an extended closure as a consequence of the prolonged infrastructure or construction project.
FISCAL ANALYSIS
EXECUTIVE BRANCH
None received.
OFFICE OF LEGISLATIVE SERVICES
The OLS determines that annual State expenditures will increase by an indeterminate amount, for the authority to establish, administer, and award grants to support small businesses that have suffered economic loss due to an extended closure as a consequence of prolonged infrastructure or construction projects undertaken by the State or another public entity.
The authority would be responsible for administering the grant program, including developing criteria for awarding grants, setting application procedures, and overseeing fund distribution. Annual State costs cannot be determined because these costs will depend on program demand and any funding made available for the program through future appropriations made by the Legislature. The bill does not specify the maximum grant amount or the number of grants to be awarded; however, the bill does provide that the authority is required to determine program grant amounts based on operating expenses incurred by a small business due to an extended closure as a consequence of a prolonged infrastructure or construction project. Under the bill, the Legislature may appropriate funds to support the grant program; however, the bill does not specify an amount.
The State, counties, and local entities may potentially experience additional expenditure increases if a State, county, or local entity is responsible for the prolonged infrastructure or construction project and is required to contribute up to five percent of the estimated total project costs as outlined in the bill.
The State may realize additional revenue from application fees collected from grant applicants. The OLS is unable to quantify these potential revenue increases because the amount of potential application fee collections cannot be determined at this time.
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Section: |
Authorities, Utilities, Transportation and Communications |
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Analyst: |
Associate Fiscal Analyst |
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Approved: |
Thomas Koenig Legislative Budget and Finance Officer |
This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.
This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).