SF 5161

Introduction - 94th Legislature (2025 - 2026)

Posted on 04/17/2026 09:08 a.m.

A bill for an act
relating to economic development; terminating prior appropriations to the
PROMISE grant program; amending Laws 2025, First Special Session chapter 6,
article 1, section 2, subdivision 2.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Laws 2025, First Special Session chapter 6, article 1, section 2, subdivision 2,
is amended to read:

Subd. 2. Business and Community Development

50,693,000

44,345,000

Appropriations by Fund
General	48,393,000	42,045,000
Remediation	700,000	700,000
Workforce Development	1,600,000	1,600,000

(a) $2,287,000 each year is for the greater
Minnesota business development public
infrastructure grant program under Minnesota
Statutes, section 116J.431. This appropriation
is available until June 30, 2029.

(b) $350,000 each year is for the
administration of the Energy Transition Office
under Minnesota Statutes, section 116J.5491.

(c) $500,000 each year is for grants to small
business development centers under Minnesota
Statutes, section 116J.68. Money made
available under this paragraph may be used to
match funds under the federal Small Business
Development Center (SBDC) program under
United States Code, title 15, section 648, to
provide consulting and technical services or
to build additional SBDC network capacity to
serve entrepreneurs and small businesses.

(d) $2,725,000 each year is for the small
business assistance partnerships program
under Minnesota Statutes, section 116J.682.
All grant awards shall be for two consecutive
years. Grants shall be awarded in the first year.
The department may use up to five percent of
the appropriation for administrative purposes.
The base for this appropriation is $1,725,000
in fiscal year 2028 and each year thereafter.

(e) $1,772,000 each year is for contaminated
site cleanup and development grants under
Minnesota Statutes, sections 116J.551 to
116J.558. This appropriation is available until
June 30, 2029. The base for this appropriation
is $1,022,000 in fiscal year 2028 and each year
thereafter.

(f) $700,000 each year is from the remediation
fund for contaminated site cleanup and
development grants under Minnesota Statutes,
sections 116J.551 to 116J.558. This
appropriation is available until June 30, 2029.

(g) $139,000 each year is for the Center for
Rural Policy and Development.

(h) $25,000 each year is for the administration
of state aid for the Destination Medical Center
Corporation under Minnesota Statutes,
sections 469.40 to 469.47.

(i) $710,000 the first year and $711,000 the
second year are for the host community
economic development program established
in Minnesota Statutes, section 116J.548. The
base for this appropriation is $875,000 in fiscal
year 2028 and each year thereafter.

(j)(1) $1,500,000 each year is for grants to
local communities to increase the number of
quality child care providers to support
economic development. Fifty percent of grant
funds must go to communities located outside
the seven-county metropolitan area as defined
in Minnesota Statutes, section 473.121,
subdivision 2.

(2) Grant recipients must obtain a 50 percent
nonstate match to grant funds in either cash
or in-kind contribution, unless the
commissioner waives the requirement. Grant
funds available under this paragraph must be
used to implement projects to reduce the child
care shortage in the state, including but not
limited to funding for child care business
start-ups or expansion, training, facility
modifications, direct subsidies or incentives
to retain employees, or improvements required
for licensing, and assistance with licensing
and other regulatory requirements. In awarding
grants, the commissioner must give priority
to communities that have demonstrated a
shortage of child care providers.

(3) Within one year of receiving grant funds,
grant recipients must report to the
commissioner on the outcomes of the grant
program, including but not limited to the
number of new providers, the number of
additional child care provider jobs created, the
number of additional child care slots, and the
amount of cash and in-kind local funds
invested. Within one month of all grant
recipients reporting on program outcomes, the
commissioner must report the grant recipients'
outcomes to the chairs and ranking minority
members of the legislative committees with
jurisdiction over early learning and child care
and economic development.

(k) $500,000 each year is for the Office of
Child Care Community Partnerships. Of this
amount:

(1) $450,000 each year is for administration
of the Office of Child Care Community
Partnerships; and

(2) $50,000 each year is for the Labor Market
Information Office to conduct research and
analysis related to the child care industry.

(l) $1,000,000 each year is for grants in equal
amounts to each of the Minnesota Initiative
Foundations. This appropriation is available
until June 30, 2029. The Minnesota Initiative
Foundations must use grant money under this
paragraph to:

(1) facilitate planning processes for rural
communities resulting in a community solution
action plan that guides decision making to
sustain and increase the supply of quality child
care in the region to support economic
development;

(2) engage the private sector to invest local
resources to support the community solution
action plan and ensure quality child care is a
vital component of additional regional
economic development planning processes;

(3) provide locally based training and technical
assistance to rural child care business owners
individually or through a learning cohort.
Access to financial and business development
assistance must prepare child care businesses
for quality engagement and improvement by
stabilizing operations, leveraging funding from
other sources, and fostering business acumen
that allows child care businesses to plan for
and afford the cost of providing quality child
care; and

(4) recruit child care programs to participate
in quality rating and improvement
measurement programs. The Minnesota
Initiative Foundations must work with local
partners to provide low-cost training,
professional development opportunities, and
continuing education curricula. The Minnesota
Initiative Foundations must fund through local
partners an enhanced level of coaching to rural
child care providers to obtain a quality rating
through measurement programs.

(m) $4,954,000 the first year and $4,955,000
the second year are for the Minnesota job
creation fund under Minnesota Statutes,
section 116J.8748. Of this amount, the
commissioner of employment and economic
development may use up to three percent for
administrative expenses. This appropriation
is available until June 30, 2029. The base for
this appropriation is $5,600,000 in fiscal year
2028 and each year thereafter.

(n) $12,370,000 each year is for the Minnesota
investment fund under Minnesota Statutes,
section 116J.8731. Of this amount, the
commissioner of employment and economic
development may use up to three percent for
administration and monitoring of the program.
This appropriation is available until June 30,
2029. Notwithstanding Minnesota Statutes,
section 116J.8731, money appropriated to the
commissioner for the Minnesota investment
fund may be used for the redevelopment
program under Minnesota Statutes, sections
116J.575 and 116J.5761, at the discretion of
the commissioner. Grants under this paragraph
are not subject to the grant amount limitation
under Minnesota Statutes, section 116J.8731.

(o) $1,246,000 each year is for the
redevelopment program under Minnesota
Statutes, sections 116J.575 and 116J.5761.

(p) $12,000 each year is for a grant to the
Upper Minnesota Film Office.

(q) $4,195,000 each year is for the Minnesota
job skills partnership program under
Minnesota Statutes, sections 116L.01 to
116L.17. If the appropriation for either year
is insufficient, the appropriation for the other
year is available. This appropriation is
available until June 30, 2029.

(r) $1,350,000 each year from the workforce
development fund is for jobs training grants
under Minnesota Statutes, section 116L.41.

(s) $250,000 each year is for the publication,
dissemination, and use of labor market
information under Minnesota Statutes, section
116J.401.

(t) $750,000 each year is for the CanNavigate
program established under Minnesota Statutes,
section 116J.6595. Of this amount, up to four
percent may be used for administrative
purposes. Any unencumbered balances
remaining in the first year do not cancel but
are available for the second year.

(u) $500,000 each year is for a grant to
MNSBIR, Inc., for support of the small
business research and development goals
provided in Minnesota Statutes, section 3.222.
This appropriation is onetime and is available
until June 30, 2027.

The purpose of the grant is to support moving
scientific excellence and technological
innovation from the lab to the market for
startups and small businesses by securing
federal research and development funding to
build a strong innovation economy and
stimulate the creation of novel products,
services, and solutions; strengthening the role
of startups and small businesses in meeting
federal research and development needs;
increasing the commercial application of
federally supported research results; and
developing and increasing the Minnesota
workforce, especially by fostering and
encouraging participation by small businesses
owned by people who are Black, Indigenous,
People of Color, and women.

MNSBIR, Inc. shall use grant money to
become the federal research and development
dedicated resource for Minnesota small
businesses to support research and
commercialization of novel ideas, concepts,
and projects to develop cutting-edge products
and services for worldwide economic impact.
Grant money shall be used to:

(1) assist startups and small businesses in
securing federal research and development
funding including the small business
innovation research and small business
technology transfer programs;

(2) support technology transfer and
commercialization from the University of
Minnesota, Mayo Clinic, and federal
laboratories;

(3) collaborate with corporate venture groups
and large businesses nationally;

(4) conduct statewide outreach, education, and
training on federal rules, regulations, and
requirements;

(5) assist with scientific and technical writing;

(6) help manage federal grants and contracts;
and

(7) support cost accounting and federal
sole-source procurement opportunities.

deleted text begin (v) $5,523,000 the first year is for the
PROMISE grant program. This appropriation
is available until June 30, 2029. Of this
amount:
deleted text end

deleted text begin (1) $1,105,000 the first year is for grants in
equal amounts to each of the Minnesota
Initiative Foundations to serve businesses in
greater Minnesota. Of this amount, $88,000
is for grants to businesses with less than
$100,000 in revenue the prior year; and
deleted text end

deleted text begin (2) $4,418,000 the first year is for grants to
the Neighborhood Development Center. Of
this amount, the following amounts are
designated for the following areas:
deleted text end

deleted text begin (i) $1,105,000 the first year is for North
Minneapolis' West Broadway, Camden, and
other Northside neighborhoods. Of this
amount, $88,000 is for grants to businesses
with less than $100,000 in revenue in the prior
year;
deleted text end

deleted text begin (ii) $1,105,000 the first year is for South
Minneapolis' Lake Street, 38th and Chicago,
Franklin, Nicollet, and Riverside corridors.
Of this amount, $88,000 is for grants to
businesses with less than $100,000 in revenue
in the prior year;
deleted text end

deleted text begin (iii) $1,104,000 the first year is for St. Paul's
University Avenue, Midway, Eastside, or other
St. Paul neighborhoods. Of this amount,
$88,000 is for grants to businesses with less
than $100,000 in revenue in the prior year;
and
deleted text end

deleted text begin (iv) $1,104,000 the first year is for grants to
businesses in the counties of Anoka, Carver,
Dakota, Hennepin, Ramsey, Scott, and
Washington, excluding the cities of
Minneapolis and St. Paul.
deleted text end

deleted text begin The base for this appropriation is $1,402,000
in fiscal year 2028 and each year thereafter.
Of this amount, $281,000 each year is for the
purposes of clause (1); $1,121,000 each year
is for the purposes of clause (2); $281,000
each year is for the purposes of clause (2),
item (i); $280,000 each year is for the purposes
of clause (2), item (ii); $280,000 each year is
for the purposes of clause (2), item (iii); and
$280,000 each year is for the purposes of
clause (2), item (iv).
deleted text end

deleted text begin (w) deleted text end new text begin (v) new text end $500,000 each year is for a grant to
the Neighborhood Development Center (NDC)
to support small business programs, including
training, lending, business services, and real
estate initiatives. Money may be used to assist
organizations outside of the seven-county
metropolitan area with technical assistance
and grants to help implement elements of
NDC's small business support model; provide
one-on-one technical assistance for
entrepreneurs; and support the operations and
marketing of a cybersecurity center. This is a
onetime appropriation. Any unencumbered
balance remaining at the end of the first year
does not cancel and is available for use in the
second year.

deleted text begin (x) deleted text end new text begin (w) new text end $627,000 the first year is for a grant
to Community and Economic Development
Associates (CEDA) to provide funding for
economic development technical assistance
and economic development project grants to
small communities across rural Minnesota and
for CEDA to design, implement, market, and
administer specific types of basic community
and economic development programs tailored
to individual community needs. Technical
assistance grants shall be based on need and
given to communities that are otherwise
unable to afford these services. Of the amount
appropriated, up to $270,000 may be used for
economic development project implementation
in conjunction with the technical assistance
received. This is a onetime appropriation. Any
unencumbered balance remaining at the end
of the first year does not cancel but is available
the second year.

deleted text begin (y) deleted text end new text begin (x) new text end $200,000 the first year is for a grant to
the African Development Center for
capacity-building initiatives to support small
business growth and sustainability. This is a
onetime appropriation and is available until
June 30, 2027.

deleted text begin (z) deleted text end new text begin (y) new text end $250,000 each year is for a grant to
Enterprise Minnesota, Inc. to directly invest
in Minnesota manufacturers under the Made
in Minnesota program under Minnesota
Statutes, section 116O.115. This is a onetime
appropriation.

deleted text begin (aa) deleted text end new text begin (z) new text end $250,000 each year is for a grant to
Enterprise Minnesota, Inc., to reach and
deliver talent, leadership, employee retention,
continuous improvement, strategy, quality
management systems, revenue growth, and
manufacturing peer-to-peer advisory services
to small manufacturing companies employing
250 or fewer full-time equivalent employees
and for operations of Enterprise Minnesota.
This is a onetime appropriation. No later than
February 1, 2026, and February 1, 2027,
Enterprise Minnesota, Inc. must provide a
report to the chairs and ranking minority
members of the legislative committees with
jurisdiction over economic development that
includes:

(1) the amount of money awarded during the
past 12 months;

(2) the estimated financial impact of the
money awarded to each company receiving
service under the program;

(3) the actual financial impact of the money
awarded during the past 24 months; and

(4) the total amount of federal money
leveraged from the Manufacturing Extension
Partnership at the United States Department
of Commerce.

deleted text begin (bb) deleted text end new text begin (aa) new text end $250,000 each year is for a grant to
the Coalition of Asian American Leaders to
support outreach, training, technical assistance,
peer network development, and direct financial
assistance targeted to Asian Minnesotan
women entrepreneurs and Asian-owned
businesses. This is a onetime appropriation
and is available until June 30, 2028.

deleted text begin (cc) deleted text end new text begin (bb) new text end $250,000 each year from the
workforce development fund is for a grant to
WomenVenture to support child care providers
through business training and shared services
programs and to create materials that may be
used, at no cost to child care providers, for
start-up, expansion, and operation of child care
businesses statewide, with the goal of helping
new and existing child care businesses in
underserved areas of the state become
profitable and sustainable.

Of this amount, up to five percent may be used
for WomenVenture's technical assistance and
administrative costs. This is a onetime
appropriation and is available until June 30,
2028.

By December 15, 2028, WomenVenture must
submit a report to the chairs and ranking
minority members of the legislative
committees with jurisdiction over agriculture
and employment and economic development.
The report must include a summary of the uses
of the appropriation, including the amount of
the appropriation used for administration. The
report must also provide a breakdown of the
amount of funding used for loans, forgivable
loans, and grants; information about the terms
of the loans issued; a discussion of how money
from repaid loans will be used; the number of
entrepreneurs assisted; and a breakdown of
how many entrepreneurs received assistance
in each county.

deleted text begin (dd) deleted text end new text begin (cc) new text end $250,000 each year is for a grant to
the Latino Economic Development Center to
assist, support, finance, and launch
microentrepreneurs by delivering training,
workshops, and one-on-one consultations to
businesses; and to guide prospective
entrepreneurs in their start-up process by
introducing them to key business concepts,
including business start-up readiness. Grant
proceeds must be used to offer workshops on
a variety of topics throughout the year,
including finance, customer service,
food-handler training, and food-safety
certification. Grant proceeds may also be used
to provide lending to business startups. This
is a onetime appropriation and is available
until June 30, 2027.

deleted text begin (ee) deleted text end new text begin (dd) new text end $150,000 each year is for a grant to
Isuroon for the following:

(1) providing loans to microbusinesses to
promote entrepreneurship and economic
growth in underserved communities;

(2) awarding grants to microbusinesses to
support start-up costs, capacity building, and
business sustainability;

(3) delivering technical assistance and training
to entrepreneurs, including support for
business operations, financial management,
and development strategies; and

(4) establishing and operating a business
incubator program to support microbusinesses
with shared resources, mentorship, and access
to professional networks.

This is a onetime appropriation and is
available until June 30, 2027.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2026.
new text end

Sec. 2. new text begin FUNDING TERMINATION.
new text end

new text begin Funding for the PROMISE grant program is terminated. Any remaining money is canceled
back to the general fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2026.
new text end