HF 4477
Introduction - 94th Legislature (2025 - 2026)
Posted on 03/18/2026 11:50 a.m.
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A bill for an act
relating to economic development; establishing a Minnesota business recovery
loan program; appropriating money; requiring a report.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. new text begin MINNESOTA BUSINESS RECOVERY LOAN PROGRAM;
APPROPRIATION.
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new text begin Subdivision 1. new text end
new text begin Appropriation. new text end
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(a) $100,000,000 in fiscal year 2026 is appropriated
from the Minnesota forward fund account to the commissioner of employment and economic
development for deposit in the small business emergency loan account in the special revenue
fund under Minnesota Statutes, section 116M.18, subdivision 9, for loans under this section.
This is a onetime appropriation. Money is available until June 30, 2028.
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(b) Of the amount appropriated in paragraph (a):
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(1) $18,000,000 is for a grant to the Minnesota Initiative Foundations to provide
zero-interest loans to businesses in greater Minnesota; and
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(2) $82,000,000 is for grants to nonprofit corporations that meet the criteria under
Minnesota Statutes, section 116M.18, subdivision 2, and are a currently certified nonprofit
partners to provide zero-interest loans to businesses in the seven-county metropolitan area.
The commissioner of employment and economic development shall select from the approved
lenders a list of lenders that have the capacity to operate the Minnesota business recovery
loan program.
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(c) Of the amount appropriated in paragraph (a), no more than eight percent may be used
for administrative costs incurred in making the loans under this paragraph.
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(d) Any unexpended amount from the amounts appropriated in this section after June
30, 2028, are canceled.
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new text begin Subd. 2. new text end
new text begin Loan program established. new text end
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A Minnesota business recovery loan program is
established to assist businesses adversely affected by activities and events related to increased
immigration enforcement in Minnesota beginning December 1, 2025, to help rebuild and
stabilize affected businesses, protect jobs, and ensure recovery of Minnesota's economy.
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new text begin Subd. 3. new text end
new text begin Eligibility for loan. new text end
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To be eligible for a loan under this subdivision, a business
must:
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(1) be located in the state and owned by a permanent resident of the state;
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(2) have a permanent physical location;
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(3) be in good standing with the secretary of state and the Department of Revenue as of
December 1, 2025;
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(4) employ the equivalent number of workers or have annual gross receipts based on
the corresponding loan amount levels provided in subdivisions 4 and 5; and
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(5) be able to demonstrate a loss in revenue that is greater than 30 percent during the
period between the day following final enactment of this act and December 1, 2025, as
compared with the same period during the previous year due to:
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(i) staffing shortages or loss of employees resulting in temporary business closure,
reduced hours, or other loss of productivity;
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(ii) reduction in customer access to the business as a result of interruption caused by
activities and events related to increased immigration enforcement; or
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(iii) other factors affecting business stability as a result of activities and events related
to increased immigration enforcement.
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new text begin Subd. 4. new text end
new text begin Loan amounts; Minnesota Initiative Foundations. new text end
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The minimum state
contribution to a loan under this subdivision is $2,500. The maximum loan amounts under
this subdivision are as follows:
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(1) for businesses employing the equivalent of ten full-time workers or fewer, or having
$150,000 or less in annual gross receipts, a maximum loan of $25,000;
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(2) for businesses employing the equivalent of more than 11 but fewer than 21 full-time
workers, or having $500,000 or less in annual gross receipts, a maximum loan of $50,000;
and
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(3) for businesses employing the equivalent of more than 20 but fewer than 101 full-time
workers, or having $1,500,000 or less in annual gross receipts, a maximum of $150,000.
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new text begin Subd. 5. new text end
new text begin Loan amounts; seven-county metropolitan area. new text end
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The minimum state
contribution to a loan under this subdivision is $2,500. The maximum loan amounts under
this subdivision are as follows:
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(1) for businesses employing the equivalent of 25 full-time workers or fewer, or having
$500,000 or less in annual gross receipts, a maximum loan of $50,000;
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(2) for businesses employing the equivalent of more than 25 but fewer than 51 full-time
workers, or having $1,000,000 or less in annual gross receipts, a maximum loan of $75,000;
and
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(3) for businesses employing the equivalent of more than 50 but fewer than 201 full-time
workers, or having $2,000,000 or less in annual gross receipts, a maximum of $200,000.
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new text begin Subd. 6. new text end
new text begin Loan purposes. new text end
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Loans must be used for business purposes exclusively in
Minnesota. Loans must not be used for consolidating, repaying, or refinancing debt accrued
prior to December 1, 2025, or speculation or investment in real estate.
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new text begin Subd. 7. new text end
new text begin Deferred payments. new text end
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Loan repayments must begin no later than three months
after a loan is awarded.
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new text begin Subd. 8. new text end
new text begin Loan forgiveness schedule. new text end
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The following forgiveness schedule and percentages
apply to a loan's principal amount if the borrower has met lender criteria, including being
current with all payments:
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(1) up to 50 percent forgiveness after a period of at least two years;
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(2) up to 75 percent forgiveness after a period of at least three years; and
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(3) up to 100 percent forgiveness after a period of at least five years.
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new text begin Subd. 9. new text end
new text begin Reporting requirements. new text end
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(a) The Minnesota Initiative Foundations and other
lenders participating in the Minnesota business recovery loan program must provide quarterly
reports on Minnesota business recovery loans to the commissioner of employment and
economic development that include a description of businesses supported by the program,
an accounting of the loans made during the quarter, the source and amount of money collected
and distributed by the program, the program's assets and liabilities, and an explanation of
administrative expenses.
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(b) By June 30, 2028, the commissioner of employment and economic development
must compile the information received under paragraph (a) in a report detailing the use of
money under this section and submit the report to the chairs and ranking minority members
of the senate and house of representatives committees with jurisdiction over economic
development.
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new text begin EFFECTIVE DATE. new text end
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This section is effective the day following final enactment.
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