Economic Development Authority reports 14% rise in financing assistance in 1995.

TRENTON, N.J.--(BUSINESS WIRE)--Jan. 31, 1996--Financings through the New Jersey Economic Development Authority (EDA) rose 14% in 1995 to $527 million, according to a report submitted today to Governor Christine Whitman by State Commerce Commissioner Gualberto (Gil) Medina and EDA Chairman Anthony R. Coscia.

The EDA's assistance went to support 259 business and not-for-profit projects, according to the report. Its financings are leveraging investments totaling $825.7 million and are expected to add 5,500 new permanent jobs and 7,650 construction job opportunities in the state.

EDA focused its efforts in 1995 on supporting the development of small businesses, emerging technology industries and businesses in urban communities. In addition to creating new opportunities for entrepreneurs and small businesses, EDA's efforts resulted in corporate locations and expansions in the state, Commissioner Medina reported.

"The Department of Commerce and the EDA worked together on a number of projects during the year that are providing new ratables, new jobs and increased economic activity in New Jersey," the Commissioner explained. "We recognize that the EDA can't replace the job losses caused by downsizings, but it can act as a counterbalance by setting into motion mechanisms for the genesis of new business development and jobs that will have a long term benefit. In this way, EDA continues to serve as an effective economic development tool for the state."

To be effective in its role as the state's development agency, EDA must constantly monitor the marketplace and identify the voids that exist, says EDA Chairman Anthony R. Coscia. "In the early part of the decade, we had to deal with the credit crunch hurting access to capital. Now it's downsizing coupled with outsourcing.

"Our job is to evaluate current economic conditions, identify opportunities as well as needs and then develop the financial products that enable businesses to grow and create jobs that support a healthy economy in New Jersey," Coscia explained. In that capacity, EDA has been able to sustain a high level of activity, averaging close to $500 million annually in financial assistance over the past several years, according to Coscia.

The EDA provides financial and technical support and gets involved in real estate development to stimulate economic growth and job creation throughout the state. During the year, it formed a number of alliances with the private sector, other government agencies and community based organizations to leverage its resources and expand its impact. Among the results outlined in the report to the Governor are:

o A 68% increase from 1994 in the low-interest bond financing arranged for New Jersey manufacturers

o Nearly $7 million in federally backed loans approved for 17 businesses with financing to be provided through the federal Small Business Administration 504 program and supplemented by bank financing.

o Nearly $19 million raised for small business lending through the sale of a unique bond issue that took advantage of funding originally obtained through federal grant monies.

o A total of $10.7 million in loans and grants provided to help private parties and municipalities investigate and clean up contaminated sites, up from $2.4 million in 1994.

o A reduction of EDA exposure under the Statewide Loan Pool for Business program to 23% in 1995 from 26% in 1994, thereby making more monies available to fill other financing gaps.

o A 50-acre site in North Brunswick purchased for development of a high technology research center that will provide state-of-the-art facilities at a reasonable cost to emerging technology companies.

o A unique financing and development structure arranged to make possible the construction of a state-of-the-art national distribution center for Barnes & Noble Inc. in South Brunswick that will provide 200 new permanent jobs, 400 construction jobs and retain nearly 200 other jobs in New Jersey.

o Expansion of the NJ Development Authority for Small Businesses, Minorities' and Women's Enterprises' innovative entrepreneurial development program, enabling nearly 100 individuals to complete business ownership courses held in Newark, Camden, Elizabeth, Trenton and Long Branch.

o Private sector commitments secured for new funding programs for minority and women owned business start ups in disadvantaged areas and for community organizations involved in local economic development in urban communities.

o Technical assistance provided to 24 manufacturers certified by the federal government as being harmed by import competition.

A copy of the report is available upon request.

CONTACT: New Jersey Economic Development Authority

Rose M. Smith, 609/292-0359