This article last updated 3-24-2020 at 2 pm.
On March 23, 2020, Minnesota Governor Tim Walz issued the Small Business Assistance Executive Order (20-15) creating an emergency loan program through the Minnesota Department of Employment and Economic Development (DEED).
This will help Minnesota small business owners who need immediate assistance to meet their families’ basic needs during COVID-19 closures.
The loan program is intended to help businesses temporarily closed under Executive Order 20-04, later clarified by Executive Order 20-08, which stopped onsite customer dining at restaurants and bars and closed an extensive list of other small businesses whose owners may not have adequate cash flow to withstand temporary closure.
Executive Order 20-15
Executive Order 20-15 directs DEED to create a Small Business Emergency Loan Program by making available $30 million from special revenue funds. These dollars will be used by DEED’s certified lender network across the state to make loans of between $2,500 and $35,000 for qualifying small businesses. The loans will be 50% forgivable and offered at a 0% interest rate. If other financing becomes available to small businesses that received an emergency loan, such as federal funding, the emergency loan must be repaid. The loan application is available here.
- Loans will:
- Range from $2,500 to $35,000 and will be based on the firm’s economic injury and the financial need.
- Be interest free.
- Be paid back monthly over five (5) years and the first payment will be deferred six (6) months with potentially partial forgiveness.
- Be provided to only Minnesota-based businesses.
- To qualify, the businesses must:
- Be current on financial obligations as of March 1, 2020
- Be an existing small business (whatever the form of their organization)
- Have been operating in Minnesota for at least one year
- Be willing to provide collateral or personal guarantee for at least 20% of loan
- Have been denied credit by a lender and have sought or be in the process of seeking, SBA Economic Injury Disaster Loan assistance
- Pay-off the emergency loan if financing is received subsequent to loan approval
- The executive order also allows local units of government or lending partners which have a revolving loan fund to use those funds to issue loans to retail and service providers for the next 90 days. DEED estimates that up to $28 million in capital could be accessible through local revolving loan funds and local governments through this action. Local partners will be looking at ways to deploy these resources to support their local businesses.
For the latest information from DEED, visit DEED COVID-19 Information for Businesses.
