Community News
$5 Million to Support 22 Small Businesses Across the State
Governor Tim Walz and the Minnesota Department of Employment and Economic Development (DEED) announced that the state will award nearly $5 million in loans for 22 small businesses across Minnesota. These businesses are the first recipients of funding through the state’s new $100 million State Small Business Credit Initiative , intended to help small businesses grow and succeed. “Small businesses are at the heart of our communities, our workforce, and our state’s economy. By investing in small businesses, we’re investing in one of our state’s greatest assets,” said Governor Walz. “This funding will bolster small businesses and help Minnesota’s economy continue to grow and thrive.” SSBCI is a significant small business initiative funded by the federal government to expand businesses’ access to capital. Announced last fall, the four SSBCI programs DEED oversees will help the agency carry out its commitment to make Minnesota the best possible place to start and grow a small business. DEED’s SSBCI programs will create or retain more than 5,500 private sector jobs over the next ten years. “Small businesses are critical to Minnesota’s economy – they employ three-fourths of our workers, create innovative products and services and enliven our corporate community,” said DEED Temporary Commissioner Kevin McKinnon. “DEED’s goal is to help small businesses launch, expand, and thrive in Minnesota, and our SSBCI loan programs help more companies enjoy success.” The loans announced come from two of the SSBCI programs DEED is implementing: one to help companies purchase automation equipment to increase productivity in light of Minnesota’s historically tight labor market, and another to help innovative seed- and early-stage technology businesses take off and grow. AUTOMATION LOAN PARTICIPATION PROGRAM As part of the Automation Loan Participation Program , DEED makes companion loans to cover financing gaps and expand opportunities for businesses purchasing machinery, equipment or software to increase productivity and automation. Eligible borrowers include manufacturing, distribution, technology and warehousing businesses located in Minnesota. The program targets businesses with fewer than 500 employees.
GROWTH LOAN FUND PROGRAM The Growth Loan Fund Program supports start-up development in Minnesota by investing in technologically innovative seed- and early-stage businesses. Eligible companies must be researching or developing proprietary products or technologies in high-tech fields like aerospace, agriculture, renewable energy, biotech, conservation, environmental engineering, and food technology. One of the businesses enrolled to receive loans from the Growth Loan Fund include a local Rochester business and Chamber member, Nanodropper ! LENDERS AVAILABLE FOR LOAN GUARANTEE PROGRAM In addition to the Automation and Growth Loan programs, DEED has begun partnering with banks, credit unions and nonprofit community lenders to provide small businesses with funding through two other SSBCI programs. DEED continues to enroll lenders for the Minnesota Loan Guarantee Program , whereby DEED provides guarantees to enrolled lenders for up to 80% of principal on loans to eligible businesses. The program helps lenders mitigate risk so they can increase capital to small businesses located across Minnesota. Borrowers include Minnesota- headquartered small businesses using the loan proceeds for eligible business purposes. Lenders can be found here . Applications for lender enrollment are also available. Finally, as part of the Small Business Loan Participation Program , DEED will purchase 25% to 30% participations in loans made by approved Community Development Financial Institutions (CDFIs) and nonprofit lenders. Borrowers include Minnesota businesses with fewer than 500 employees seeking loans for eligible business purposes. DEED is contracting with CDFI and nonprofit lenders now, and eligible companies will soon be able to find an appropriate lender here .
JULY 2023 — ROCHESTER AREA CHAMBER OF COMMERCE ADVANTAGE MAGAZINE | 23
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