FROM THE WARREN REPORTER (NJN Publishing)
Friday, April 14, 2006
Phillipsburg Town Council tried to give local businesses a boost by approving a series of state grant and loan applications, valued at more than $117,000, at the April 4 council meeting.
Council approved five grant applications to the New Jersey Urban Enterprise Zone Authority to stimulate business in the town. Due to the depressed economy, portions of the town are designated a New Jersey Urban Enterprise Zone (UEZ), where businesses charge customers only three-percent state sales tax (instead of six) and the money that is collected goes not to the state but into a special fund for economic revitalization projects.
The largest of the economic revitalization grant application approved by council $50,000 to establish a rent-assistance program for downtown businesses. "This is an initiative to attract stores and new tenants," said Phillipsburg UEZ Director Mark Portnoy. He said the program would allow new tenants to come into town without paying rent the first year. The program would pay the first nine months of rent, up to $10,000, and participating landlords would be asked to forego the final three months.
The program would have strict guidelines, according to Portnoy. Only five new businesses would be considered the first year. To be eligible, those businesses would have to have been established as successful in another town. The town is looking for relocations or businesses that want to open a satellite location. No start-up businesses would be eligible for the program. Established businesses are necessary to draw customers, said Portnoy, and the town must do something extra to keep businesses afloat during the first few years.
The plan is a pilot program and could be expanded to other businesses if it is successful this year.
Although he voted for the grant, Councilman John Damato was not sold on the program. He said the town has spent more than $5 million since the UEZ came into place in 1994 with no considerable upswing in business or jobs. "I don't see too many of them (businesses) stepping up to the plate," he said. "I'm still not seeing bang for my buck."
He claimed that Lambertville made a great turnaround without this kind of expense of public dollars.
Council President Jim Shelly said the program could be helpful. "These businesses are struggling and the great thing about this is that they don't have to worry about rent that first year," he said.
Phillipsburg's depressed economy is responsible for the revitalization falling short, according to Dave DeGerolamo, council's vice president and liaison to the UEZ. "To spend $5 million and all we have to show for it is some pretty buildings is frustrating," he said. However, he said the restorations and new facades have made Phillipsburg attractive to new businesses. The new program, along with the Perrucci waterfront development and other businesses slated to move in, could make the difference. "If we can get these businesses along with what we have and what is being proposed this could be the year we turn the corner," he said.
The New Jersey Urban Enterprise Zone Authority has never turned down one of the town's applications, according to Portnoy.
The second largest grant the town has requested is a low-interest $30,000 loan to finance a runaround track for the Bel-Del Railroad passenger rail line. The railroad, owned by Kean Burrenga, off Market Street, is one of the town's chief tourist attractions. Shelly said the money would allow the rail line to install a turnaround so the line can make a u-turn at its Riegelsville stop rather than backing into the station. Burrenga would be responsible for paying back the loan, said DeGerolamo.
A $22,500 grant earmarked for the Faro Design Group, approved by council, would help the company fit-out a 40,000-square-foot section of existing plant at the Preferred Commerce Park (the Ingersoll tract). Portnoy said the Kenilworth-based company plans to make furniture there, and could create between 25 and 30 jobs. The money Phillipsburg is providing will help the company purchase an air compressor and work on the air in-take system. The total project cost is $180,000 with the majority of the money being picked up by the property owner, said Portnoy, who expects the new business to be up and running within two months.
An $8,450 grant would fund faade work on the new South Main Barbeque at South Main and McKeen. The total budget for that project is $130,000 said Portnoy.
Finally, the town approved a $6,500 grant for engineering work on a restoration of the Morris Canal Railway Arch, a historic attraction. Portnoy said the town received a grant late last year to restore the arch but that grant did not provide funding for professional costs.