Minnesota Legislature
SF 1449
1st Engrossment - 94th Legislature (2025 - 2026) Posted on 03/25/2025 10:20am
Current Version - 1st Engrossment
1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 2.10 2.11 2.12 2.13 2.14 2.15 2.16 2.17
2.18 2.19 2.20 2.21 2.22 2.23 2.24 2.25 2.26 2.27 2.28 2.29 2.30 2.31 2.32 2.33 2.34 3.1 3.2 3.3 3.4
3.5 3.6 3.7 3.8 3.9 3.10 3.11 3.12 3.13 3.14 3.15 3.16 3.17 3.18 3.19 3.20 3.21 3.22 3.23 3.24 3.25 3.26 3.27 3.28 3.29 3.30 3.31 3.32 4.1 4.2 4.3 4.4 4.5 4.6
A bill for an act
relating to cannabis; amending the maximum amount of state contributions to
cannabis microbusinesses; amending the commissioner's deadline to approve loan
applications; allowing nonprofit corporations to retain loan interest payments to
cover expenses; requiring loan interest rates to be reported; allowing nonprofit
corporations to use contract funds to cover expenses; amending Minnesota Statutes
2024, sections 116J.659, subdivisions 4, 5; 116J.6595, subdivision 3.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2024, section 116J.659, subdivision 4, is amended to read:
Subd. 4.
Loans to businesses.
(a) The criteria in this subdivision apply to loans made
by nonprofit corporations under the program.
(b) Loans must be used to support a new cannabis microbusiness in the legal cannabis
industry. Priority must be given to loans to businesses owned by individuals who are eligible
to be social equity applicants and businesses located in communities where long-term
residents are eligible to be social equity applicants.
(c) Loans must be made to cannabis microbusinesses that are not likely to undertake the
project for which loans are sought without assistance from the program.
(d) The minimum state contribution to a loan is $2,500 and the maximum is either:
(1) deleted text begin $50,000deleted text end new text begin $75,000new text end ; or
(2) deleted text begin $150,000deleted text end new text begin $200,000new text end , if state contributions are matched by deleted text begin an equal or greater amountdeleted text end new text begin
at least 25 percentnew text end of new private investment.
(e) Loan applications given preliminary approval by the nonprofit corporation must be
forwarded to the commissioner for approval. The commissioner must deleted text begin give final approval
for each loan made by the nonprofit corporation under the programdeleted text end new text begin make approval decisions
within 30 days of receiving a loan application. If the application contains insufficient
information to make an approval decision, the nonprofit corporation must be notified within
14 days with all information that needs to be providednew text end .
(f) A cannabis microbusiness that receives a loan may apply deleted text begin to renew thedeleted text end new text begin for a subsequentnew text end
loan. deleted text begin Renewal applications must be made on an annual basis anddeleted text end A cannabis microbusiness
may deleted text begin receive loans for up to six consecutive yearsdeleted text end new text begin have a maximum of two program loansnew text end .
A nonprofit corporation may deleted text begin renewdeleted text end new text begin originatenew text end a loan to a cannabis microbusiness that is no
longer a new business provided the business would otherwise qualify for an initial loan and
is in good standing with the nonprofit corporation and the commissioner. A nonprofit
corporation may deleted text begin adjust the amount of a renewed loan, or not renew a loan,deleted text end new text begin decline to originate
a subsequent loannew text end if the nonprofit corporation determines that the cannabis microbusiness
is financially stable and is substantially likely to continue the project for which the loan
deleted text begin renewaldeleted text end is sought. new text begin Refinancing of existing debt is prohibited.
new text end
(g) If a borrower has met lender criteria, including being current with all payments for
a minimum of three years, the commissioner may approve either full or partial forgiveness
of interest or principal amounts.
Sec. 2.
Minnesota Statutes 2024, section 116J.659, subdivision 5, is amended to read:
Subd. 5.
Revolving loan account administration.
(a) The commissioner shall establish
a minimum interest rate for loans or guarantees to ensure that necessary loan administration
costs are covered. The new text begin fee or new text end interest rate charged by a nonprofit corporation for a loan
under this section must not exceed the Wall Street Journal prime rate. For a loan under this
section, the nonprofit corporation may charge a loan origination fee equal to or less than
one percent of the loan value. The nonprofit corporation may retain the amount of the
origination fee.
(b) Loan repayment of principal must be paid to the commissioner for deposit in the
CanStartup revolving loan account. Loan interest payments deleted text begin must be deposited in a revolving
loan account created by the nonprofit corporation originating the loan being repaid for
further distribution or use, consistent with the criteria of this sectiondeleted text end new text begin may be retained by the
nonprofit corporation originating the loan to help cover expenses for loan servicing and
originationnew text end .
(c) Administrative expenses of the nonprofit corporations with whom the commissioner
enters into agreements, including expenses incurred by a nonprofit corporation in providing
new text begin technology, insurance, legal, audit and accounting, reporting, new text end financial, technical, managerial,
and marketing assistance to a business receiving a loan under this section, are eligible
program expenses the commissioner may agree to pay under the grant agreement.
new text begin
(d) Average interest rates charged by the nonprofit corporations must be reported
biannually and publicly published by both the agency and the nonprofit corporation.
new text end
Sec. 3.
Minnesota Statutes 2024, section 116J.6595, subdivision 3, is amended to read:
Subd. 3.
Grants to organizations.
(a) Grant money awarded to eligible organizations
may be used for both developing technical assistance resources relevant to the regulatory
structure of the legal cannabis industry and for providing technical assistance or navigation
services to individuals.
(b) The commissioner must award grants to eligible organizations through a competitive
grant process.
(c) To receive grant money, an eligible organization must submit a written application
to the commissioner, using a form developed by the commissioner, explaining the
organization's ability to assist individuals in navigating the regulatory structure of the legal
cannabis industry, particularly individuals facing barriers to education or employment.
(d) An eligible organization's grant application must also include:
(1) a description of the proposed technical assistance or navigation services, including
the types of individuals targeted for assistance;
(2) any evidence of the organization's past success in providing technical assistance or
navigation services to individuals, particularly individuals who live in areas where long-term
residents are eligible to be social equity applicants;
(3) an estimate of the cost of providing the technical assistance;
(4) the sources and amounts of any nonstate money or in-kind contributions that will
supplement grant money, including any amounts that individuals will be charged to receive
assistance; and
(5) any additional information requested by the commissioner.
(e) In awarding grants under this subdivision, the commissioner shall give weight to
applications from organizations that demonstrate a history of successful technical assistance
or navigation services, particularly for individuals facing barriers to education or employment.
The commissioner shall also give weight to applications where the proposed technical
assistance will serve areas where long-term residents are eligible to be social equity
applicants. To the extent practicable, the commissioner shall fund technical assistance for
a variety of sectors in the legal cannabis industry, including both processing and retail
sectors.
new text begin
(f) Nonprofit corporations may use up to 5 percent of the contract funds for expenses
incurred while administering the contract, including expenses related to technology, utilities,
legal services, training, accounting, insurance, financial management, benefits, reporting,
and audits.
new text end