Helping NJ get back to business: The (limited) help so far

As New Jersey moves into Phase 2 of Governor Murphy’s restart and recovery plan, many questions remain.

Restaurants can begin seating customers in socially distant outdoor dining areas on June 15. Non-essential retail can begin welcoming customers inside their buildings with reduced capacity and mandatory mask wearing. Salons and barber shops can reopen June 22 with as-yet undefined protocols. Even libraries, museums and some government offices like the MVC could open soon.

But for many businesses, this is only the start of the recovery process.It’s unclear how much revenue can be generated with so many restrictions in place. For industries where the profit margins were already slim, operating under reduced capacity may not be enough to fully rehire staff, maintain inventory or, possibly, reopen at all.

GETTING NJ BACK TO BUSINESS: LIVE, THURSDAY at 7 p.m.: Eric Scott welcomes state Senate President Steve Sweeney into the studio to take your feedback on how to help local NJ businesses as they restart and grow their operations, after shutdowns due to the novel coronavirus pandemic. More information here.

Just as the U.S. Congress has passed a myriad of COVID related relief measures, New Jersey’s legislature has also been busy. Hundreds of bills addressing everything from the furlough of public workers to student interest loan relief have been introduced. Many are bogged down in the typical legislative process, but some critical relief measures have managed to make it either into law or sit on the governor’s desk awaiting action.

Among those are bill (S2332), setting aside $100 million in rental assistance for those facing eviction after losing income due to the pandemic. Aimed mostly at low- and middle-income earners in New Jersey, the intent is to provide a bridge to those who are at least 30 days behind on their rent.

With the summer tourism season in doubt, small businesses down the Shore are struggling. While outdoor dining options and limited access to in-person retail will begin to allow these businesses generate some revenue, many will still fail. The Senate and Assembly have passed a bill (A3959) creating the “New Jersey Hospitality Small Business Emergency Loan Program.” Aimed primarily at bars and restaurants, the program would offer interest free loans up to $10,000 per month for small businesses to cover expenses.

These loans would be in addition to the help already being made available through federal and state programs. Those programs can be found HERE and HERE.

Pending legislation would address things like delinquent taxes, cancellation of insurance, college loan interest and the deferral of taxes for small business.

Many bills look to mitigate the impact of future pandemics from both an economic and public health standpoint.

One bill even designates March 9 as “COVID-19 Hero’s Day."

Perhaps the biggest legislative fight ahead is over what New Jersey does to bridge a multi-billion dollar budget shortfall brought on by the collapse of the New Jersey economy. The state’s fiscal health was already suffering before Governor Phil Murphy ordered businesses closed and issued stay-at-home orders.

Gov. Phil Murphy’s plan is to borrow money to cover the state’s general operating expenses. That’s akin to you using your credit card to pay your mortgage, buy food, and other household expenses with no current income to pay it back. Eventually those bills come due. The state Assembly has approved borrowing up $14 billion, but Senate President Steve Sweeney is opposed without deep cuts to the budget first. Murphy has been unwilling to have those conversations, and admits he has no “plan ‘B’” if borrowing is not authorized. Borrowing also has to be backed by some type of revenue stream. That’s likely going to involve tax hikes. I take a closer look at that, HERE.

The bottom line is that the road to recovery is going to be long and come with severe ramifications and pain for almost every segment of New Jersey’s economy and population.

Even as some restrictions are lifted and businesses are allowed to begin limited operations, many business owners say it is still happening too slowly. Restaurants have been cleared to begin outside dining on Monday, June 15, but a Monday open costs them yet another weekend of business. They are trying to get the governor to allow them to open that weekend.

Gym owners are also still furious they have not been told when they can open.

One small business owner told our Bill Spadea the economic damage is far worse than any virus.

Adding to the anxiety over the pace of recovery is fear thegovernor will order them closed again if there is a resurgence of infections in the weeks ahead. Murphy has already said he is very nervous about reopening businesses and could close them again.