New Jersey S 866: Requires EDA to provide loans through small business loan program at lower interest rates, with more flexible repayment terms if issued to small businesses owned or controlled by certain veterans, and prohibit certain fees.

Bill Text

S866 

SENATE, No. 866 

STATE OF NEW JERSEY

222nd LEGISLATURE

� 

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Senator MICHAEL L. TESTA, JR.

District 1 (Atlantic, Cape May and Cumberland)

SYNOPSIS

���� Requires EDA to provide loans through small business 
loan program at lower interest rates, with more flexible repayment terms if 
issued to small businesses owned or controlled by certain veterans, and 
prohibit certain fees.

CURRENT VERSION OF TEXT 

���� Introduced Pending Technical Review by Legislative 
Counsel.

�� 

An Act concerning the New Jersey Economic Development 
Authority�s issuance of loans to certain veteran-owned small businesses through 
a small business loan program, and amending P.L.2011, c.201 (C.34:1B-241.3).

���� Be It 
Enacted by the Senate and General Assembly of 
the State of New Jersey:

���� 1.��� Section 2 of P.L.2011, 
c.201 (C.34:1B-241.2) is amended to read as follows

���� 2.� a. The authority shall 
maintain and administer a small business loan program for the purpose of 
providing loans to eligible small businesses.� The authority shall consult with 
the department in administering the small business loan program as it applies 
to: (1) an eligible small business that is an eligible farming operation; (2) 
defining the types of dairy products that shall be considered as value-added 
dairy products under the small business loan program, not inconsistent with 
section 1 of P.L.2019, c.240 (C.34:1B-241.1); (3) developing small business 
loan program guidelines for qualified dairy farmers and eligible farming 
operations; and (4) developing materials to provide to qualified dairy farmers 
seeking to expand value-added dairy production in this State.

���� b.� (1)� Loans made through 
the small business loan program may be made to an eligible small business.� The 
loan funds may be applied to any aspect of the eligible small business that 
supports its capital purchases, employee training, and salaries for new 
positions as determined by the authority.

���� (2)�� Notwithstanding 
paragraph (1) of subsection b. of this section, loans made by the authority to 
an eligible farming operation may only be applied to aspects of the eligible 
farming operation that support the farming operation's farm equipment 
purchases, as determined by the authority.� Farm equipment purchased from loan 
funds made pursuant to P.L.2019, c.240 shall be used by all of the business 
entities in the eligible farming operation.

���� (3)�� Two or more business 
entities engaged in farming operations in the State seeking to participate in 
the loan program established pursuant to subsection a. of this section shall 
submit a joint application in a form as the authority shall require and shall include 
information as the authority determines is necessary in consideration of a loan 
authorized pursuant to P.L.2019, c.240.

���� c.���� (1) In order to receive 
a loan pursuant to the small business loan program, a business, at the time of 
application, shall provide proof that it is an eligible small business and 
shall enter into a small business loan agreement with the authority. 

���� (2)�� In order to receive a 
loan from the authority pursuant to P.L.2019, c.240, a business entity engaged 
in farming operations in the State, at the time of application, shall provide 
proof, in a manner determined by the authority, that it and at least one other 
business entity meet the requirements to be an eligible farming operation, 
including, but not limited to, proof that each business entity is engaged in 
farming operations in the State and will use the farm equipment purchased with 
the loan funds.

���� d.��� The authority shall 
review and may approve applications for the small business loan program.

���� e.���� A business seeking to 
participate in the small business loan program shall submit an application in a 
form as the authority shall require.� The application shall include information 
the authority shall determine is necessary in consideration of the provisions 
of P.L.2011, c.123 (C.52:14B-21.1 et seq.).

���� f.���� Loans to an eligible 
small business under this section shall:

���� (1)�� be made pursuant to a 
small business loan agreement made pursuant to subsection c. of this section;

���� (2)�� bear interest at rates 
and terms deemed appropriate by the authority; and

���� (3)�� contain other terms and 
conditions considered appropriate by the authority that are consistent with the 
purposes of P.L.2011, c.201 (C.34:1B-241.1 et seq.) and with rules and 
regulations adopted by the authority pursuant to section 3 of P.L.2011, c.201 (C.34:1B-241.3).

���� The provisions of a loan 
agreement with an eligible farming operation shall include, but need not be 
limited to, a statement of an eligible farming operation's proportional shares 
of ownership, its farm equipment usage and maintenance responsibilities, and 
its loan repayment responsibilities for any loan proceeds