HF 5

as introduced - 91st Legislature, 2020 1st Special Session (2019 - 2020) Posted on 06/20/2020 06:24pm

A bill for an act
relating to economic development; appropriating money for emergency small
business grants and loans; reimbursing the Minnesota 21st century minerals fund;
adjusting the budget reserve forecast calculation; changing the fund receiving
small business loan repayments; making technical changes; amending Minnesota
Statutes 2018, section 16A.152, subdivision 2; Laws 2020, chapter 71, article 1,
section 11.

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

Section 1.

Minnesota Statutes 2018, section 16A.152, subdivision 2, is amended to read:

Subd. 2.

Additional revenues; priority.

(a) If on the basis of a forecast of general fund
revenues and expenditures, the commissioner of management and budget determines that
there will be a positive unrestricted budgetary general fund balance at the close of the
biennium, the commissioner of management and budget must allocate money to the following
accounts and purposes in priority order:

(1) the cash flow account established in subdivision 1 until that account reaches
$350,000,000;

(2) the budget reserve account established in subdivision 1a until that account reaches
$1,596,522,000;

(3) the amount necessary to increase the aid payment schedule for school district aids
and credits payments in section 127A.45 to not more than 90 percent rounded to the nearest
tenth of a percent without exceeding the amount available and with any remaining funds
deposited in the budget reserve;

(4) the amount necessary to restore all or a portion of the net aid reductions under section
127A.441 and to reduce the property tax revenue recognition shift under section 123B.75,
subdivision 5, by the same amount; deleted text begin and
deleted text end

(5) the clean water fund established in section 114D.50 until $22,000,000 has been
transferred into the fund deleted text begin . deleted text end new text begin ; and
new text end

new text begin (6) the amount necessary to increase the Minnesota 21st century fund by not more than
the difference between $5,000,000 and the sum of the amounts credited and canceled to it
in the previous 12 months under Laws 2020, chapter 71, article 1, section 11, until the sum
of all transfers under this section and all amounts credited or canceled under Laws 2020,
chapter 71, article 1, section 11, equals $20,000,000.
new text end

(b) The amounts necessary to meet the requirements of this section are appropriated
from the general fund within two weeks after the forecast is released or, in the case of
transfers under paragraph (a), clauses (3) and (4), as necessary to meet the appropriations
schedules otherwise established in statute.

(c) The commissioner of management and budget shall certify the total dollar amount
of the reductions under paragraph (a), clauses (3) and (4), to the commissioner of education.
The commissioner of education shall increase the aid payment percentage and reduce the
property tax shift percentage by these amounts and apply those reductions to the current
fiscal year and thereafter.

(d) Paragraph (a), clause (5), expires after the entire amount of the transfer has been
made.

Sec. 2.

Laws 2020, chapter 71, article 1, section 11, is amended to read:

Sec. 11. TRANSFERS; SMALL BUSINESS EMERGENCY LOAN PROGRAM.

new text begin (a) new text end Notwithstanding Minnesota Statutes, sections 116J.423 and 116J.8731, in fiscal year
2020, the following amounts are transferred to the small business emergency loan account
in the special revenue fund under Minnesota Statutes, section 116M.18, subdivision 9:

(1) $20,000,000 from the special revenue fund account of the Minnesota 21st century
fund under Minnesota Statutes, section 116J.423, subdivision 1; and

(2) $10,000,000 from the Minnesota investment revolving loan account under Minnesota
Statutes, section 116J.8731, subdivision 5, in the special revenue fund.

Transferred amounts are appropriated to the commissioner of employment and economic
development to make loans as set forth in Governor's Executive Order 20-15, Providing
Immediate Relief to Small Businesses During the COVID-19 Peacetime Emergency. All
loan repayments are credited proportionately to the accounts from which the loan amounts
were originally transferred. Any amounts remaining in the small business emergency loan
account that are unexpended and unobligated at the close of the fiscal year cancel
proportionately to the accounts from which the amounts were originally transferred.

new text begin (b) Beginning the day following the day in which the total amount transferred under
Minnesota Statutes, section 16A.152, and from repayments of loans and cancellations of
funds under this section to the Minnesota 21st century fund equals $20,000,000, all further
repayments of loans to the Minnesota 21st century fund under this section are transferred
to the general fund.
new text end

Sec. 3. new text begin SMALL BUSINESS LOAN GUARANTEE TRUST FUND ACCOUNT;
APPROPRIATION.
new text end

new text begin Notwithstanding Minnesota Statutes, section 116J.881, subdivision 4, $2,500,000 in
fiscal year 2020 is appropriated from the loan guarantee trust fund account in the special
revenue fund under Minnesota Statutes, section 116J.881, subdivision 4, to the commissioner
of employment and economic development for the purposes of section 4. This amount is
available until June 30, 2021.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4. new text begin SMALL BUSINESS RELIEF GRANTS; APPROPRIATION.
new text end

new text begin (a) $60,000,000 in fiscal year 2020 is appropriated from the coronavirus relief fund to
the commissioner of employment and economic development for grants under paragraph
(b). Funds are available until December 30, 2020.
new text end

new text begin (b) Of the amounts appropriated in paragraph (a) and in section 3:
new text end

new text begin (1) $31,250,000 is for a grant to the Minnesota Initiative Foundations to serve businesses
in greater Minnesota; and
new text end

new text begin (2) $31,250,000 is for grants to nonprofit corporations that meet the criteria under the
small business emergency loan program pursuant to Laws 2020, chapter 71, section 11, to
serve businesses in the seven-county metropolitan area. The Department of Employment
and Economic Development shall select from the approved lenders a list of those lenders
that have the capacity to operate the small business relief grants program.
new text end

new text begin (c) No more than $2,200,000 of the amounts available under paragraph (b) may be used
for administrative costs incurred from making grants under this section.
new text end

new text begin (d) Grant recipients under paragraph (b) shall use funds to make grants of up to $10,000
to individual businesses, including any subgrantees, that:
new text end

new text begin (1) are located in the state of Minnesota and owned by a permanent resident of the state
of Minnesota;
new text end

new text begin (2) have a permanent physical location;
new text end

new text begin (3) were in good standing with the secretary of state and the Department of Revenue as
of March 1, 2020;
new text end

new text begin (4) employ the equivalent of 50 full-time workers or less; and
new text end

new text begin (5) can demonstrate financial hardship as a result of the COVID-19 outbreak.
new text end

new text begin Priority shall be given to businesses that were restricted from operating by an executive
order on May 18, 2020, such that the business could not operate at least at 51 percent of
normal capacity. Grant funds received by individual businesses shall be used for working
capital to support payroll expenses, rent, mortgage payments, utility bills, and other similar
expenses that occur or have occurred since March 1, 2020, in the regular course of business.
new text end

new text begin (e) Of the amount granted under paragraph (b):
new text end

new text begin (1) a minimum of $18,000,000 must be awarded to businesses that employ the equivalent
of six full-time workers or less;
new text end

new text begin (2) a minimum of $15,000,000 must be awarded as follows: (i) at least $10,000,000 to
minority business enterprises, as defined in Minnesota Statutes, section 116M.14, subdivision
5; (ii) at least $2,500,000 to businesses that are majority owned and operated by veterans
as defined in Minnesota Statutes, section 197.447; and (iii) at least $2,500,000 to businesses
that are majority owned and operated by women; and
new text end

new text begin (3) a minimum of $2,500,000 is for grants to operators of a privately owned permanent
indoor retail space and food market that has an ethnic cultural emphasis having at least 25
tenants primarily comprised of businesses with fewer than 20 employees. Grants under this
clause: (i) may be made for up to $250,000 per operator and of that amount all but $10,000
of any grant must be made as subgrants to existing tenants of the operator; (ii) must be used
primarily for maintaining existing tenants; and (iii) require that at least 50 percent of the
grant be used to forgive the rent of existing tenants. A tenant subgrantee is subject to the
requirements in paragraph (d).
new text end

new text begin (f) Grants under this section may not be made to a business that previously received a
loan with funds appropriated in Laws 2020, chapter 71, article 1, section 11. Eligible
businesses may not receive more than one grant under this section.
new text end

new text begin (g) The commissioner may develop criteria, forms, applications, and reporting
requirements for use by the grantees in paragraph (b).
new text end

new text begin (h) Grants under paragraph (d) must be awarded by lottery after applications are collected
over a period of no more than ten calendar days. Grants must be awarded by December 30,
2020.
new text end

new text begin (i) Grants and the process of making grants under this section are exempt from the
following statutes and related policies: Minnesota Statutes, sections 16A.15, subdivision 3;
16B.97; and 16B.98, subdivisions 5, 7, and 8. The commissioner of employment and
economic development shall audit the use of grant funds under this section in accordance
with standard accounting practices. The exemptions under this paragraph expire on December
30, 2020.
new text end

new text begin (j) By December 31, 2020, the commissioner shall report to the legislative committees
with jurisdiction over economic development policy and finance on the grants provided to
grantees and any subgrantees under this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end