Bill > A2505

Introduced Session

This bill creates the "Business Incubator Assistance Program" (program) within the New Jersey Economic Development Authority (authority). The purpose of the program is to provide assistance to a privately-supported business incubator facility in the form of loans used to assist incubator businesses in operation at a facility. Loans provided under the program are to be made pursuant to a loan agreement, be of an amount not to exceed $600,000, be repaid over a period not to exceed two years, bear interest at the prime rate or a lower rate, and contain other terms and conditions considered appropriate by the authority that are consistent with the purposes of the bill. The bill defines business incubator facility as a privately-supported, low-cost, short-term occupancy, rental space wherein assistance is granted by an established business to a incubator businesses located at the facility employing selected technologies. An incubator business is defined in the bill as a corporation, partnership, limited liability company, or sole proprietorship supported by private sources of capital, including, but limited to, private equity, "angel" investment, or venture capital that: 1) is in the formative stage of development; or 2) is engaged in the design, development, and introduction of new biotechnology, information technology, re-manufacturing, advanced materials, processing, engineering or electronic technology products, or innovative manufacturing processes; and 3) meets any other requirements for an incubator business as the authority may develop. A business incubator facility accepted into the program: 1) is required to be in compliance with all State and federal worker protection and environmental laws and regulations; 2) may not owe past due State or federal taxes or local property taxes; 3) is required to provide the necessary information to the authority in order for the authority to prepare an annual report on the program; 4) is to agree to allow the authority to access any and all books and records of the business incubator facility and incubator business the authority may require to monitor compliance; 5) to certify to the authority that at least 15 percent of the business incubator facility's operations are funded by an established business; and 6) to agree to allow the authority to be paid three to five percent of business incubator facility revenues received from royalty payments from any intangible property awarded to any incubator business at the business incubator facility. Royalty payments are to be used to pay off any loan principal or interest due to the authority. The authority is to prepare an annual report on the program, provide it to the Governor and Legislature, and make it available on the authority's website. The report is to include the number of business incubator facility applicants, the number of business incubator facilities approved for the program, the names and types of incubator businesses located within business incubator facilities in the program, the total amount of loans distributed, the loan amounts received per business incubator facility, the number of jobs created overall and per business incubator facility, the amount of capital investment made per business incubator facility, and any other information as the authority determines is necessary to evaluate the progress of the program. A business incubator facility may be subject one or more of the following consequences for failure to meet the provisions of the bill after receiving a loan: 1) the suspension of the business incubator facility's participation in the program for one or more years as specified in the application; 2) the termination of the business incubator facility's participation in the program; or 3) the proportional recovery of any loan given to a business incubator facility under the program. Certain types of businesses are prohibited from operating at a business incubator facility that participates in the program. In the case of a business incubator facility or incubator business that acted fraudulently, the facility or business, as appropriate, would be immediately terminated from the program, be subject to applicable criminal penalties including the crime of offering a false instrument for filing in the first degree, and be required to pay back the loan the facility received.

Committee Categories

Nancy Muñoz (R)*, 

Introduced, Referred to Assembly Science, Innovation and Technology Committee (on 02/03/2020)