TRENTON, N.J. (Oct. 11, 2011) – The Board of the New Jersey Economic Development Authority (EDA) today approved an award to Goya Foods under the Urban Transit Hub Tax Credit Program to encourage the company to remain and grow in New Jersey. With support from the New Jersey Partnership for Action, the nation’s largest Hispanic-owned food company may expand operations to a new $127 million warehouse and distribution center in Jersey City, preserving more than 315 jobs and creating an estimated 175 new, permanent positions in the state.  

“When you remove the roadblocks that stifle job creation and private investment, you start to see world-class companies such as Goya Foods taking a closer look at New Jersey,” said Lt. Governor Kim Guadagno.  “While the company continues to explore options in other states, the Partnership for Action has worked hard to keep Goya and its hundreds of employees in New Jersey. We are hopeful that today’s action by the EDA will be the linchpin of our efforts.”  

Goya Foods is celebrating a major milestone this year as it marks its 75^th anniversary.  Founded in 1936, family-owned Goya Foods has established itself as the leader in Latin American food products, and manufactures, packages and distributes more than 1,600 high-quality food products from the Caribbean, Mexico, Central and South America. The company employs over 3,000 and has 13 facilities across the United States.  This year, and as part of its 75^th anniversary celebration, Goya has donated more than two million pounds of food to multiple nonprofit organizations to help ensure the continuation of their services, and has funded scholarship programs nationwide. 

“Today’s decision is an important step for Goya Foods as we consider staying in New Jersey with what would be our largest facility in the U.S.,” said Goya Foods Executive Vice President Peter Unanue.  “We are very excited about moving forward with this process, and look forward to making our decision official once it is completed.  In the meantime, we want to express our deepest gratitude to Governor Christie, Lt. Governor Guadagno and the New Jersey Economic Development Authority for their partnership and support as we all work to the future creation of jobs in the Garden State.”    

Under the leadership of Lt. Governor Guadagno, the Partnership for Action has worked with Goya over the last year to encourage the company to remain and expand in New Jersey.  The Business Action Center provided advocacy services to the company, and the tax credit of up to $81.9 million over ten years through the Urban Transit Hub Tax Credit Program is another key factor in making the expansion financially viable for Goya.  

“The collective efforts of the Partnership for Action, together with the enhanced Hub program, are producing the results we envisioned as we sought to strengthen the state’s ability to revitalize communities and advance redevelopment projects that create jobs, spur private investment and improve the quality of life for businesses and residents,” said Caren Franzini, EDA CEO. 

The Christie Administration’s New Jersey Partnership for Action is a three-pronged public-private approach to economic development and the starting point for all initiatives, policies and efforts to grow New Jersey’s economy and create quality, sustainable jobs in our communities. The three elements of the Partnership include Choose New Jersey, an independently funded and operated 501(c)(3) not-for-profit corporation created to encourage and nurture economic growth throughout New Jersey; the Business Action Center, which reports directly to the Lt. Governor and provides the business community with a single point of contact, applying a proactive, customer-service approach to businesses’ interactions with State government; and, the EDA, serving as the state’s “bank for business.”   

To learn more about New Jersey’s expertise and incentives to attract and support business growth, call the Business Action Center at (866) 534-7789 or visit the State’s Business Portal at www.newjerseybusiness.gov.

By Jared Kaltwasser/NJBIZ
October 11, 2011

The head of a North Jersey credit union says increasing consumer frustration with banks is helping credit unions gain a greater foothold in the Garden State.

Bank of America last month said it would start charging a $5 monthly fee to customers who make purchases using debit cards. The bank said the fee, which will be instituted next year, is necessary because of new federal rules limiting the processing fee financial institutions can charge retailers when a customer pays with a debit card.


Lourdes Cortez, president and CEO of North Jersey Federal Credit Union, said the fee is just the latest annoyance for a consumer population growing increasingly wary of big banks.


“I think consumers are getting pretty fed up, to be honest with you,” she said. “I think they are getting to the point where they’re tired of paying fees to have access to their money.”


Cortez said those frustrations have brought new customers to her credit union. NJFCU has added a gross total of 4,000 new members this year, bringing its membership ranks to 31,000.


Cortez said credit unions are in a better position to capitalize on banking customer dissatisfaction thanks to a stepped-up marketing campaign by credit unions and organizations such as the New Jersey Credit Union League.


“What our industry has done in the past couple of years is really gone out there and made an effort to explain the differences (between credit unions and banks), to promote the products and services we offer, and to get involved in financial literacy programs,” she said.


One way credit unions are different from banks, Cortez said, is that credit unions are nonprofits, meaning any profits are returned to members in the form of lower loan rates, higher interest rates on deposits or lower fees.


“When potential customers look at credit unions, they’re realizing that the board consists of volunteers,” she said. “It’s our members that actually serve on our board, and each member has a vote. So they’re not dealing with stockholders. That makes a big difference.”


John McWeeney, president and CEO of the New Jersey Bankers Association, said that’s not the only difference between banks and credit unions: Banks, he said, have to pay income taxes, while credit unions don’t. Banks also have to comply with the federal Community Reinvestment Act, a bill that requires banks to lend and invest locally, but also results in stacks of paperwork for banks.


“When you ask a banker about credit unions, they’ll tell you it’s an unlevel playing field,” he said.


McWeeney said there undoubtedly are market shifts taking place, but he said it isn’t a one-way migration from banks to credit unions, it’s also bank to bank or even credit union to bank.


“The good news for consumers is they have a lot of choices,” he said.


McWeeney said there are 117 banks with New Jersey headquarters, in addition to large banks that are based elsewhere, but have numerous branches in New Jersey.


Cortez said she expects continued membership growth, but that’s not to say credit unions haven’t been hit hard by the recession.


“As a financial institution, expenses continue to rise and our margins continue to narrow,” Cortez said.


Lower profits mean there’s less to give back to members, so Cortez said credit unions like hers will need to seek out new ways to provide benefits for members.


“We need to look at innovation,” she said.

By Richard Newman/The Record
October 6, 2011

Paterson small-business owner Odilo Vazquez, 66, emigrated from Galicia, Spain, to Newark more than 40 years ago to pursue the American dream. He earned a bachelor’s degree from Stevens Institute of Technology in Hoboken and went on to earn master’s and doctorate degrees in mechanical engineering from Rensselaer Polytechnic Institute in Troy, N.Y.

 He was designing nuclear submarine and aircraft carrier power plants at General Electric in Schenectady, N.Y, when he and his wife moved back to Newark to be close to their parents and siblings. Then, after short stints with a couple of defense contractors in the area, he started his own company, F3 Engineering.

 In 12 years he has built it into a business with more than $10 million in annual sales, 45 employees and a five-year plan to more than double its revenue.

 The U.S. Small Business Administration recently recognized that accomplishment by naming him New Jersey Minority Small Business Person of the Year.

 “At a time when many companies are struggling, it is refreshing to see innovative small-business owners like Odilo Vazquez creating and bringing skilled jobs in the engineering and technology sector right to Paterson,” said Alfred J. Titone, the SBA’s district director for New Jersey. “F3 Engineering is a prime example of how minority-owned small businesses are contributing to our economy.”

 Sales grew from about $500,000 in 2002 to $10.4 million this year.

 The company, which designs and manufactures aircraft and submarine components, participates in the Small Business Administration’s 8(a) program, which lets minority- and women-owned manufacturers receive no-bid government contracts of up to $5.5 million, if they persuade the government that they can do the job properly at reasonable time and cost.

 “The SBA has been a great asset,” Vasquez said Wednesday on his East 26th Street factory floor. “They gave us nine years where they mentored us and guided us on growing our business.” The company will be fully weaned from the program next year, he said.

 “As of last year only about 36 percent of new contract dollars were through the 8(a) program,” Vasquez said. “We started to transition away from that almost four years ago.”

 Most of the company’s revenue comes from contract manufacturing of complicated and high-priced aircraft and submarine components, with blueprints provided by the U.S. military or other defense contractors.

 The company has developed several products of its own with help from Defense Department research grants, including an engine mount for the Navy’s E2-C radar–equipped surveillance planes that would reduce vibration from the engine and make the aircraft safer and more durable. A cart that the company designed is used to change components on nuclear submarines.

 “They sell for about half a million dollars,” Vazquez said. “We have seven of them out there.”

 F3 is working on a project to modify F-18 fighter jet wings to strengthen them and lengthen their life.

 “We are in a very nice niche where we have the ability to do this highly complex work that is almost a mirror of a Bell or a Boeing or a Northrop Grumman on a very small scale,” Vazquez said.

 The company plans to move later this year from its 26,000-square-foot space down the block into a 50,000-square-foot space.

 “This will allow us to push out more products. Right now we are sitting on a backlog of 12 months of firm orders,” Vasquez said. “That’s a great position to be in.”

By Karen Sudol/The Record
October 3, 2011

 Lt. Governor Kim Guadagno continued to show the state government’s support for Garden State businesses by visiting two companies in North Jersey on Monday as part of a statewide tour of 100 establishments.

 Monday’s visits to SGS North America in Rutherford and American Fittings Corporation in Fair Lawn were the 68th and 69th, respectively, on the tour designed to highlight businesses and emphasize the administration’s backing for economic growth and development in the state.

 Guadagno toured both company headquarters and met behind closed doors with executives to discuss concerns, issues and successes.

 She told company executives to contact her if they have any problems doing business within the state.

 The first stop was SGS North America, a world leader in inspection, verification, certification and testing that’s been headquartered in Rutherford since 2003. Guadagno said the group discussed property taxes and privatization. She also received feedback on conditions that make it harder to conduct business in the state.

 The company employs 420 in New Jersey and plans to create 100 more jobs here, said Jeffrey McDonald, SGS North America’s chief operating officer. SGS North America also is expanding and renovating a Fairfield laboratory and building a testing facility in Carteret, company executives said.

 “Not only are they staying in New Jersey, but they’re growing in New Jersey,” Guadagno said. “They’re making it work here, and I appreciate that.”

 Guadagno then traveled to the new Fair Lawn headquarters of American Fittings Corporation, which manufactures electrical conduit fittings. She walked through the warehouse rooms as Allen Fischbein, the company president, explained how the firm turns steel into parts.

 The family-owned business had operated out of Westwood since 1946, but relocated to Fair Lawn earlier this year to accommodate its growth, said Bill Simmel, vice president of marketing. The business has grown from 33 employees in 2005 to 122 now.

 When it moved, Simmel said, American Fittings wrote a letter to the governor’s office asking if it would be interested in a look at the facility. Guadagno decided to visit.

 The company had a chance to relocate to China years ago but decided to stay and compete in New Jersey, said Fischbein.

 Guadagno said of American Fittings Corporation that “Not only can you make it in the United States, but you can make it here in New Jersey, and you can do it better and you can hire people in a recession. It debunks the myth that you can’t make it in the United States anymore.”

PRINCETON, N.J. (Sept. 29, 2011) – Flanked by industry colleagues and key dignitaries, Princeton Power Systems (PPS) yesterday unveiled its ‘An Island in the Sun’ demonstration site that boasts a 200 kW solar array, lithium-ion battery system, and the new Demand Response Inverter (DRI). The demonstration was followed by an open-house and technical workshop at the company’s new manufacturing facility in Lawrence.

Darren Hammell, PPS’ Executive Vice President, stated, “Today’s demonstration culminates several hard years of work by many talented people at PPS and Sandia. Energy storage, communications, and controls are key advancements in making solar energy valuable to the electric grid, and making renewables part of our energy future; PPS is proud to be manufacturing advanced products to support these goals here in the United States.”

The DRI is the culmination of a three year joint effort between PPS, the U.S. Department of Energy, and Sandia National Laboratories’ Solar Energy Grid Integration Systems (SEGIS) team.  During the demonstration, PPS showcased features of the DRI that improve electrical grid interconnectivity and efficiency, enhance the performance of renewable energy systems, and allow for better integration of electric vehicles and distributed power generation.  PPS was awarded the contract in September 2010 following a competitive solicitation for the SEGIS program. The DRI was recently selected as a recipient of the prestigious “2011 R&D 100 Award,” which recognizes the most technologically significant products as voted by a council of technical experts.  

PPS was formed in a dormitory room after its founding team won first place in Princeton University’s 2001 Business Plan Contest. The company, which has since grown from a staff of three to 50, is a leading manufacturer of advanced power conversion products and alternative energy systems, with patented electronics that provide a more reliable and cost-effective means for converting electric power cleanly and efficiently. The company’s new manufacturing facility in Lawrence is 40,000 square feet and features large manufacturing floors, multiple loading docks, and a large supply of configurable power to support PPS’ continued growth.
           
PPS has taken advantage of various resources offered by the State and Federal governments to support the development and commercialization of its products, as well as its continued expansion in the State.  The company most recently received $3.3 million through New Jersey’s Clean Energy Manufacturing Fund (CEMF) to help advance the DRI.   Administered by the New Jersey Economic Development Authority, the CEMF was created to support New Jersey-based manufacturers of Class I renewable energy or energy efficiency systems, products or technologies. The program provides up to $3.3 million per awardee in two tranches, with up to $300,000 as a grant for project assessment and design, and up to $3 million as a low interest loan.       

Please contact PPS at (609) 955-5390 or visit www.princetonpower.com for more information.   To learn about opportunities for business growth throughout New Jersey, call the Business Action Center at (866) 534-7789 or visit the State’s Business Portal at www.newjerseybusiness.gov.

A meeting of the Fort Monmouth Economic Revitalization Authority has been scheduled for Wednesday, October 19, 2011 at 7:00 pm at the Tinton Falls Municipal Building, 556 Tinton Avenue, Tinton Falls, NJ 07724.  Formal action may be taken at this meeting.  A copy of the proposed agenda can be found 48 hours prior to the meeting at the websites of the Fort Monmouth Economic Revitalization Authority: www.nj.gov/fmera, and the New Jersey Economic Development Authority: www.njeda.gov.

By Gwen Moran/Entrepreneur
September 28, 2011

The small-business lending situation is a lesson in irony: Despite government efforts to spark more lending, uptake is down. In June, the SBA reported that in the first quarter of 2011, loans to small businesses fell $15 billion, marking the third straight quarter of decline. That figure has been trending downward since 2008–but this drop comes in the wake of major government efforts to incite more lending.

 Much of the problem, it seems, is not lack of available capital, but lack of demand for it among small businesses. A combination of recession-born pragmatism and tougher lending restrictions has all but strangled the regular flow of capital from banks to small businesses.

 Some innovative community banks aim to change that. Many are moving beyond banking services, helping clients discover financial products they might not have considered. Counseling, education, networking opportunities–these institutions are pulling out all the stops in an effort to spur new lending growth. Will it be enough?

 The Push to Give Away Cash

 The Small Business Jobs Act that was signed into law a year ago was expected to bring a big capital infusion. Among the provisions is a $30 billion Small Business Lending Fund (SBLF), which provides capital for small banks and $20 billion in state initiatives to enhance small-business lending. Proponents estimate that the fund’s capital could fuel as much as 10 times its value in small-business lending–but as of June, only 869 community banks had applied for $11 billion of the fund.

 Why? Perhaps because of how complicated it is. “It has taken a little longer to get all the t’s crossed and the i’s dotted on that program,” says Paul Merski, executive vice president and chief economist of the Independent Community Bankers of America. “It was a little bit more involved because it isn’t just a capital program, it’s a program to foster small-business lending.”

 Funds began to be released to these banks in July, and Merski estimates that the funds drawn will begin to make a difference in the small-business lending marketplace in early 2012.

“By early next year, you’ll have enough capital in place and loans processed to see a measurable difference in the flow of credit to small businesses,” Merski says. Still, many are skeptical that the influx of capital will do anything to improve the small-business lending situation. The problems, they believe, are elsewhere.

 Soft Demand, Tough Standards

 According to the March National Federation of Independent Business Small-Business Optimism Index, 93 percent of small businesses say either all their credit needs are met or they are not interested in borrowing–a historic high. The survey concludes that lack of demand, rather than the availability of credit, is blocking loan growth.

 That’s part of the picture, but underwriting standards also have made borrowing tough for small businesses, says Dana Kilborne, president and CEO of Orlando, Fla.-based Florida Bank of Commerce.

 “The difficulty for small businesses wasn’t so much that credit was unavailable,” she says. “It was that it was dominated predominantly by the large banks, where there’s been a significant rule change in terms of what their credit standards were, or they just weren’t lending at all.” Kilborne says the lack of consistency in lending standards during good times led to a swing to tighter credit standards that made it difficult for businesses to qualify for loans.

 The real estate crisis could have played a part as well. Half of all small-business loans are backed by some sort of real estate as collateral, Merski says. As values decline, those properties have less equity to secure credit.

 Some banks are beginning to see a turnaround in confidence, however. While New York City’s Sterling National Bank, a publicly traded $2 billion institution, falls outside the typical community banking threshold of $1 billion, the bank works primarily with New York metro-area small to midsize businesses.

 “A year ago, I would have told you that the better clients are only utilizing 40 to 50 percent of their available credit,” says Sterling president John C. Millman. “They were controlling inventory and expenses, allowing inventory to run off. That changed in the last six months. We’re seeing more enthusiasm and utilization of credit lines increase. I would say they’re running at 65 percent today.”

 Hustling for Flow

 When the money is there to lend, community banks typically are working hard to make deals with small businesses, Merski says.

 At MidSouth Bancorp, which serves southern Louisiana and eastern Texas, there is no question about the quest for small-business customers. “We take out billboards that say, ‘We have money to lend,'” says CEO Rusty Cloutier. “Every Thursday morning, we have an aggressive calling campaign where all of our offices are calling on small businesses, trying to get our bid out and find ways we can lend to them.”

 MidSouth has applied for $32 million from the SBLF, Cloutier says, and is planning to get its low-interest lending incentive for SBLF down to 1 percent. If a bank increases small-business lending 10 percent over the previous year, it can pay as little as 1 percent interest on the capital drawn from the fund. MidSouth plans to use that low-interest incentive to pass along better rates to customers.

 Some banks are also using the power of their networks to build relationships with prospective lending clients. At North Jersey Community Bank, a female vice president organized a group of 18 women business owners and leaders from throughout northern New Jersey to build relationships and mentor one another. Her inspiration came after noticing that women have a tendency to spread the word and become advocates for businesses and products they’re passionate about, says North Jersey Community Bank chairman and CEO Frank Sorrentino III.

 Each month these leaders are being hosted by the bank for an event that has become an important part of their professional development. In similar fashion, Sterling holds regular luncheons in its posh, on-site dining room for business clients to mingle with the bank’s top brass, and it also hosts 70 seminars and continuing education events each year for its clients.

 Kilborne’s Florida Bank of Commerce also hosts a variety of seminars. Presenters include economists who discuss market trends and business forecasts; fraud prevention authorities; and tax experts to bring business clients up to speed on tax changes. The bank also provides QuickBooks training for small-business clients.

 “We think our best clients are the ones that have good management, and we do whatever we can to assist them and give them access to things they wouldn’t ordinarily have, like these quarterly seminars,” Kilborne says.

 Bryn Mawr, Pa.-based community bank Bryn Mawr Trust has assembled several advisory boards made up of local business owners to advise the bank on the needs and services of business customers. Each board’s eight to 10 members are paid a stipend of $125 per meeting to give their opinions on everything from needed services to new branch locations, says CEO Ted Peters. The bank has adopted such services as remote deposit capture, which allows companies to deposit checks without making a trip to the bank; and establishing a higher-yield business savings account, based on recommendations of the boards. This attracts businesses that may become prospects for loan services, Peters says.

 Community banks often are scrappier than larger banks, taking on loans that require more complex methods to secure, partnering with other entities, or even overlooking elements of a spotty loan application if some of the key concepts are strong.

 MidSouth partners with two area nonprofits that process business micro-loans of as little as $1,500. Although that’s not business the bank would typically target, it allows them to establish early relationships with firms “that might become better customers for us,” Cloutier says.

 Kilborne says that community bank lending decisions go beyond just the financial statements. Sorrentino tells the story of a liquor store client who needed a loan. The prospective business owner lacked the collateral to secure the $300,000 loan himself, so Sorrentino and his team asked him questions about the resources available to him.

 “As we sat down and talked, suddenly there was this relative who had been in the liquor business and knew it, so that was appealing,” Sorrentino says. “Then there was a cousin who had equity in his house that he could bring to the table to secure the loan. Suddenly, when you put all of these pieces together, the deal made sense.”

 It’s that kind of flexibility–and willingness to look beyond the traditional–that could make smaller banks a better option for business lending, Sorrentino says. And, he says, that kind of “let’s get this done” approach is what has allowed North Jersey Community Bank–and others like it–to continue to lend to small businesses and grow, even during the economic downturn.

By Ed Beeson/Star-Ledger
September 28, 2011 

The U.S. Treasury announced today it doled out $25.6 million to four New Jersey community banks as part of an effort to drum up lending to small businesses.

 Center Bancorp in Union netted $11.3 million; Highlands Bancorp in Vernon, got $6.9 million; Freedom Bank of Oradell received $4 million; and Harmony Bank in Jackson Township was given $3.5 million. The money is intended to help small businesses expand and create new jobs, according to the Treasury. The funding came through the Small Business Lending Fund, or SBLF, which provides capital to community banks holding less than $10 billion in assets. All told, nine community banks in the state have received a total of $73.1 million in funding through the program. Today’s announcement was for the final wave of the program.

 “Billions of dollars in SBLF funds are now being put to use in communities all across the nation, spurring small business growth and job creation,” Deputy Treasury Secretary Neal Wolin said in a statement. “These investments, which will help propel lending by Main Street banks, are good for our economy and good for America’s small businesses.”