June 22, 2022

NJEDA Seeking Contributions for Diversified Development Fund

Economic development

The New Jersey Economic Development Authority (NJEDA) has released a Request for Information (RFI) to better understand the challenges faced by Minority and Women-Owned Development Enterprises (MWDEs) in New Jersey in accessing capital , especially companies that are engaged in the development of residential and commercial real estate.

Governor Phil Murphy and NJEDA are exploring a diversified development fund to help grow existing MWDEs by addressing capital barriers. The Governor’s proposed budget for fiscal year 2023 invests $65 million in new real estate initiatives, including $20 million to capitalize a fund to support projects led by developers of color.

The NJEDA is particularly interested in receiving comments, questions, recommendations, facts, information, ideas and responses that will help the authority better understand the scope and variables related to access to capital and other forms of financing available to underserved developers.

According to a Black Enterprise article citing Bank of America’s Black Business Owner Spotlight, 82% of entrepreneurs of color say they have to work harder than their non-diverse peers. Another study found that nearly 60% of female entrepreneurs report not having the same access to capital as their male counterparts.

“New Jersey is one of the most diverse states in the country, and the resources we provide to developers and business owners must reflect that diversity,” said Lieutenant Governor Sheila Oliver, who is commissioner of the Department of community affairs. “Over the past four years, we have implemented many programs that are helping to make New Jersey a national model for inclusive and sustainable economic development. The feedback we receive through this RFI will help us continue to strengthen our commitment to small businesses statewide. »

“Capital is essential for any business owner or developer looking to start or grow a business, maintain cash flow or cover operating costs,” said NJEDA chief executive Tim Sullivan. “Developing programs to support developers who often find themselves unable to access funding is paramount to our efforts to create a stronger, fairer, and more equitable New Jersey economy that Governor Murphy champions. “

NJEDA seeks information and ideas from qualified entities, including but not limited to MWDEs, community development finance institutions, community development lending units of medium and large banks, other mission-based lenders, community development organizations that work closely with MWDEs, state and local government entities, and other stakeholders with perspectives on structural barriers and disparities faced by minority-owned real estate developers and/or women in terms of access to capital. NJEDA is also seeking interest and ideas on solutions to overcome these barriers, including, but not limited to, existing programs that address disparities in funding available for residential and commercial development.

“This RFI is an important vehicle to help us break down the systemic barriers that often prevent MWDEs from accessing the capital they need to succeed,” said Michelle Bodden, NJEDA’s Chief Diversity and Inclusion Officer. “We encourage stakeholders across the state to send us feedback to help us create a program that addresses racial and gender disparities that have existed for far too long.”

The African American Chamber of Commerce of New Jersey (AACCNJ) and the Hispanic Chamber of Commerce of the State of New Jersey (SHCCNJ) both hailed the news from RFI as an important step in connecting various developers with a access to capital.

“We commend the Murphy administration for their intentionality in creating a diversified development fund. In doing so, it will enable Black businesses to leverage resources that will allow them to realize their plans and ideas in meaningful ways,” said AACCNJ Founder, President and CEO, John E. Harmon, Sr. ., IOM. “Furthermore, if New Jersey remains committed to this type of strategy, it will over time reduce the systematic economic disparities that persist and improve our state’s competitiveness.”

“New Jersey Census data revealed that the Hispanic community made up 21.6% of the state’s population in 2020, likely approaching a number closer to 25% with under-reporting and changes from 2020 to 2022 “said Carlos Medina, President and CEO of SHCCNJ. “Recognizing the vital role of Hispanics statewide, the NJ State Hispanic Chamber of Commerce supports any approach to removing barriers to equity in access to capital, which is the number one challenge facing face the 120,000 Hispanic-owned businesses in NJ that fuel the state’s economy.”

All questions regarding this RFI should be submitted in writing no later than Friday, May 6, by email to: MWDE-BarriersRFI@njeda.com. The subject line of the email should read: “QUESTIONS-2022 RFI-DI-141 – MWDE RE BARRIERS”. The answers to the questions submitted will be published on the Authority’s website in the RFI section, on or around Friday 13 May.

All RFI responses must be submitted in writing no later than 11:59 p.m. EST, Friday, May 27, via email to: MWDE-BarriersRFI@njeda.com. The subject line of the email should read: “RFI Response-2022-RFI-DI-141 – MWDE DEVELOPER BARRIERS”.

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