The Lakewood Development Corporation (LDC) today awarded over $300,000 for two contracts to Lakewood Community Services Corporation (LCSC) which is headed by Rabbi Moshe Zev Weisberg, who is also a board member of the LDC.
New Jersey's Urban Enterprise (UEZ) Program was enacted in 1983, in the Department of Community Affairs, to foster an economic climate that revitalizes designated urban communities and stimulates their growth by encouraging businesses to develop and create private sector jobs through public and private investment.
The UEZ Program offers participating businesses incentives that encourage business growth and stimulate local economies, including a 50% reduced sales tax, tax free purchases on certain items such as capital equipment, facility expansions, and upgrades, and financial assistance from agencies such as NJEDA.
Currently, there are 32 zones statewide, including a portion of Lakewood Township, which are included in the UEZ program.
The Lakewood Development Corporation (LDC) is the arm of the Township which administers Lakewood's Urban Enterprise Zone program. The LDC uses the annual UEZ grant money to offer business loans and grants to certified UEZ businesses as well as numerous other business encouragement incentives such as business-to-business networking events.
However, the LDC does not use Township employees to do the legwork of consulting prospective grant and loan applicants, processing their applications, or coordinating the business-to-business networking events.
Rather, the LDC contracts out these services to the Lakewood Community Services Corporation (LCSC) which is headed by Rabbi Moshe Zev Weisberg. [Rabbi Weisberg also just so happens to be a board member of the LDC.]
Today, the LDC renewed their bi-annual contracts with LCSC.
Both of the contracts are for a term from January 1, 2023 through December 31, 2024.
a) Consulting services for the UEZ revolving loan programs for a total amount of $193,304
b) Consulting services for UEZ advertising, marketing, and special events for a total amount of $135,000
These contracts total $328,304.
Under the UEZ revolving loan programs, LDC offers businesses a Standard Microloan of up to $35,000 per loan with incentives including no closing costs and a low 3.5% interest rate, and LDC also offers businesses negatively impacted financially by the Coronavirus pandemic a COVID-19 Emergency Loan up to $10,000 per loan with no closing costs and an even lower 1% interest rate. Both loans are for a term of 10 years.
Under the UEZ revolving loan programs consulting services contract, the LCSC assists businesses by providing information regarding various available loans and grants, the review of loan and grant applications, prequalification for the loans, presentation assistance, and Small Business assistance and mentorship.
Under the advertising, marketing, and special events contract, LCSC coordinates the business-to-business networking events as well email marketing for the events (by maintaining an email distribution list).
New Jersey State law requires that contracts for such high amounts need to be bid out to the lowest bidder, through the publishing of a Request for Qualifications (RFQ).
The New Jersey Local Public Contracts Law (NJSA 40A:11-4.4) specifically provides that "the competitive contracting process shall... include all requirements deemed appropriate and necessary to allow for full and free competition between vendors; information necessary for potential vendors to submit a proposal."
In other words, the bidding process needs to be "fair and open to all."
The LDC worked around this issue by wording their RFQ to expressly stipulate that they are seeking applicants who possess "knowledge of non-profit corporations, the Township of Lakewood and the subject matter to be addressed under the contract... [and] have a minimum of the most recent 5 years of current experience facilitating advertising, marketing and special events in the Lakewood UEZ."
The RFQ further specifies that "it is expected that applicants responding to this request for proposal will have facilities and expertise in these types of services to satisfactorily carry out the required consulting services ... to the business community."
The RFQ further includes a punchline that "due to the fact that the nature of effective coaching requires more often than not the physical presence of the facilitating coaches, Applicants shall be within 5 miles of Lakewood Township."
Thanks to this very narrow criteria, LCSC is assured they will be the sole bidder for these contracts.
The LDC already, back in November, gave their initial go ahead for the spenditure of these contracts, by approving submissions for State approval to award these 2 year contract.
They have been waiting since then to receive this State approval, which was just recently received.
Also today, the LDC Board voted to increase their current standard Lakewood UEZ Microloan terms from a maximum of $35,000 at an interest rate of 3.5% for a term of 10 years up to $50,000.
The Board's Resolution states that the Township wishes to facilitate greater business development and job creation to start-up and certified businesses within the Lakewood Urban Enterprise Zone boundary.
Whereas, the Township, back in 1997, established a Micro-lending program to help improve the financial standing of its registered UEZ businesses and hence allow for increased employment opportunities; and over the course of many years, the terms and conditions of the standard Microloan have changed responsive to the economic climate of the time; and due to evolving economic conditions in Lakewood and the associated costs of doing business, the Township desires to increase the limit of its standard Microloan program.
The LDC's Finance Committee met on April 26, 2023 to assess the need for this increase and determined that this is a proper action and recommended this increase to the full LDC Board of Trustees.
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