Newark Has Plan To Jumpstart Local Businesses: Here’s How

NEWARK, NJ — Newark was a city on the rise before the COVID pandemic hit. And on Thursday, officials released details about a plan to keep that economic momentum going.

Speaking at a news conference at Kleen Kutz Unisex Beauty Salon on Bergen Street, Mayor Ras Baraka outlined a two-year plan to jumpstart the city’s economy and aid small businesses. The choice of venue wasn’t a coincidence; the salon is one of many in Newark that have already benefited from the city’s previous pandemic recovery grants.

According to Newark officials, the new program will help small businesses like Kleen Kutz connect to grants, technical assistance and other services aimed at supporting their recovery and bringing customers back.

It will get off to a running start with an $8.8 million budget for the first year, officials said. Read More: Newark Will Get $182 Million From Latest COVID Relief Bill

City officials stated:

“The plan will use federal funding from the 2021 American Rescue Plan legislation to build a tech cluster, create permanently affordable commercial space, offer free or low-cost broadband access to small business through Newark Fiber, and expedite development approvals. It aligns with the city’s workforce system to ensure that Newarkers — particularly unemployed, underemployed, and residents with barriers to employment — are connected to good job opportunities.”

Officials added:

“The plan was developed in collaboration with Bloomberg Associates, a pro-bono philanthropic consultancy that works with cities and mayors around the world. It builds on ideas from the Newark Equitable Growth Commission, the Newark Forward recommendations, national best practices and the work done through the Reopening and Recovery Strikeforce and other economic development strategies. In addition, the city’s Department of Economic and Housing Development met with local stakeholders and conducted extensive outreach over a period of four months to better understand what Newark needs to support a lasting, equitable recovery.”

“This plan is a map for a stronger, fairer, and more prosperous Newark,” Baraka said.

“After this incredibly challenging year of mourning, loss, and economic uncertainty, we have turned the corner,” the mayor continued. “We are fortunate to have a historic level of investment from the federal government that provides the kind of support our small businesses and residents need.”

“Before the pandemic, Newark was experiencing a period of rapid investment and economic expansion guided by our principles of equitable growth,” Baraka added. “This plan resumes that progress.”

Here are some of the things the money will go towards, officials said:

• Newark will set the goal of being the first city in America to offer free or low-cost broadband access to all small businesses and will work with Invest Newark to expand Newark Fiber to all five wards
• The city will reduce small business costs by deferring fees / business taxes, waiving code compliance penalties / fees and developing a utility assistance program on sewer and water bills
• The City of Newark will hire a dedicated FTE focused on growing and supporting Newark’s startup/ tech cluster
• The City of Newark will hire Business Development Manager(s) to create sector strategies
• The City of Newark will create a development compliance team by hiring two FTEs to monitor and enforce developer adherence to contractual obligations under PILOT and redevelopment agreements, and review and enforce Redevelopment Agreements
• In collaboration with Invest Newark and other partners, the City of Newark will develop a set of criteria and map to guide the strategic location of new housing across Newark’s Wards and support equitable development goals
• The City of Newark will begin the process of implementing an internal- and external- facing digital system to track development applications, and design incentives and other mechanisms for expediting approvals on projects that have community benefits
• The city will fund technical assistance at local economic development partners to help small businesses re-open and recover
• The City of Newark will leverage American Rescue Plan and philanthropic funding to launch Round 4 of the Small Business Grant Fund
• Arts and Cultural Affairs will launch Round 3 of the Creative Catalyst Fund (CCF), the city-sponsored grant program for Newark-based artists, creative entrepreneurs and non-profit cultural organizations
• The city will work with neighborhood partners to re-tenant and activate vacant storefronts and upper floors by engaging property owners, increasing flexible uses in zoning regulations, accelerating permitting and identifying sources of capital for building improvements

Baraka said the Economic Recovery Plan is the first of a package of recovery initiatives that he and the city will be launching over the next eight weeks. Future efforts include:

• Expanded emergency rental assistance
• Expanded small business emergency assistance
• Five-year affordable housing goals
• A portal of available affordable housing
• “Back Together Again,” a series of community solidarity events
• Additional neighborhood redevelopment designations
• NewarkGo, a low-cost transportation pilot using dockless bikes and e-scooters

THE PANDEMIC’S EFFECT ON NEWARK

The financial impact of the pandemic has been dire in Newark, officials said.

According to a statement from the mayor’s office:

“The pandemic has had a devastating impact on Newark’s hardworking residents and small business owners. Businesses that are minority owned, immigrant-owned, locally owned, and women-owned have been particularly hard hit. Between February and May 2020, 16,000 residents lost jobs, bringing Newark’s unemployment to 19 percent. As of May 2021, Newark’s unemployment still remains almost double than the national average at 10.7 percent.”

City officials continued:

“Job losses in Newark have been concentrated in four sectors: hospitality, healthcare/social services, retail, and ‘other services,’ which represent 60 percent of all jobs lost. These job losses have resulted in $60-$100 million of lost consumer spending that would otherwise have gone to Newark businesses, even after factoring in government benefits. Sectors with high concentrations of small businesses will take the longest to recover.”

Read More: Here's How COVID Has Impacted Newark Small Businesses

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