Assembly approves EDA employee‑ownership program after debate over taxpayer costs

Trenton — The state Assembly on third reading passed Assembly Bill 5016, establishing a program within the Economic Development Authority to promote employee ownership through technical assistance, feasibility studies and grant support.

Supporters said the bill does not change the legality of employee ownership but creates centralized resources to make it practicable. Assemblymember Swain, the bill’s sponsor, said the measure would create an EDA program, an advisory commission, technical assistance and taxpayer‑funded grants to help convert businesses to employee ownership.

Opponents questioned the program’s design and cost. “Energy is through the roof, insurance cost through the roof, property tax through the roof,” an opponent said while arguing that creating numerous studies and consultants will not solve underlying business costs. Another member criticized the use of public funds to pay consultants, saying, “we're gonna pay a select group of politically connected consultants” for work that could be done by university programs.

The debate focused on whether the state should underwrite feasibility studies and grants estimated in the bill (members cited a typical feasibility study cost of about $35,000) or instead require existing public institutions to provide low‑cost assistance. Representative critics recommended leveraging Rutgers’ MBA students as an alternative to contracting consultants.

The clerk reported the final roll call: 62 yes, 15 no and 1 abstention. The bill was declared passed and will take the usual course for enrollment and transmittal.

What it means: The EDA will now be authorized to create a program that provides technical assistance and grant funding to support employee‑ownership conversions; details on program rules, grant amounts and implementation timelines will be determined as the EDA develops program guidelines and any required administrative rules.

Next steps: The bill moves to the usual enrollment process and related administrative steps before implementation; the Assembly record shows opponents asking for greater cost controls and alternatives that could influence implementation design.