SF 4027

1st Engrossment - 93rd Legislature (2023 - 2024) Posted on 04/09/2024 10:04am

A bill for an act
relating to economic development; making policy and technical changes to
programs under the Department of Employment and Economic Development;
requiring reports; amending Minnesota Statutes 2022, sections 116J.435,
subdivisions 3, 4; 116J.5492, subdivision 2; 116J.8748, subdivision 1; 116M.18;
268A.11; 446A.072, subdivision 5a; 446A.073, subdivision 1; Minnesota Statutes
2023 Supplement, sections 116J.682, subdivisions 1, 3, 4; 116J.8733; 116J.8748,
subdivisions 3, 4, 6; 116L.17, subdivision 1; Laws 2023, chapter 53, article 15,
sections 32, subdivision 6; 33, subdivisions 4, 5; repealing Minnesota Statutes
2022, sections 116J.435, subdivision 5; 116L.17, subdivision 5.

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

ARTICLE 1

STATE DISLOCATED WORKER PROGRAM

Section 1.

Minnesota Statutes 2023 Supplement, section 116L.17, subdivision 1, is amended
to read:

Subdivision 1.

Definitions.

(a) For the purposes of this section, the following terms have
the meanings given them in this subdivision.

(b) "Commissioner" means the commissioner of employment and economic development.

(c) "Dislocated worker" means an individual who is a resident of Minnesota at the time
employment ceased or was working in the state at the time employment ceased and:

(1) has been permanently separated or has received a notice of permanent separation
from public or private sector employment and is eligible for or has exhausted entitlement
to unemployment benefits, and is unlikely to return to the previous industry or occupation;

(2) has been long-term unemployed and has limited opportunities for employment or
reemployment in the same or a similar occupation in the area in which the individual resides,
including older individuals who may have substantial barriers to employment by reason of
age;

(3) has been terminated or has received a notice of termination of employment as a result
of a plant closing or a substantial layoff at a plant, facility, or enterprise;

(4) has been self-employed, including farmers and ranchers, and is unemployed as a
result of general economic conditions in the community in which the individual resides or
because of natural disasters;

(5) is a veteran as defined by section 197.447, has been discharged or released from
active duty under honorable conditions within the last 36 months, and (i) is unemployed or
(ii) is employed in a job verified to be below the skill level and earning capacity of the
veteran;

(6) is an individual determined by the United States Department of Labor to be covered
by trade adjustment assistance under United States Code, title 19, sections 2271 to 2331,
as amended; deleted text begin or
deleted text end

(7) is a displaced homemaker. A "displaced homemaker" is an individual who has spent
a substantial number of years in the home providing homemaking service and (i) has been
dependent upon the financial support of another; and due to divorce, separation, death, or
disability of that person, must now find employment to self support; or (ii) derived the
substantial share of support from public assistance on account of dependents in the home
and no longer receives such support. To be eligible under this clause, the support must have
ceased while the worker resided in Minnesota deleted text begin . deleted text end new text begin ;
new text end

new text begin (8) is the spouse of a member of the United States armed forces who is on active duty
and who meets at least one of the following: (i) has lost employment as a direct result of
relocation to accommodate a permanent change in the service member's duty station; or (ii)
is unemployed or underemployed and facing barriers to obtaining or upgrading employment;
new text end

new text begin (9) is an individual with non-work-related injuries or illnesses who does not have a
workers' compensation case but needs support to reenter or remain in the workforce; or
new text end

new text begin (10) is an adult with a low income, is a recipient of public assistance, or is deficient in
basic skills.
new text end

For the purposes of this section, "dislocated worker" does not include an individual who
was an employee, at the time employment ceased, of a political committee, political fund,
principal campaign committee, or party unit, as those terms are used in chapter 10A, or an
organization required to file with the federal elections commission.

(d) "Eligible organization" means a state or local government unit, nonprofit organization,
community action agency, business organization or association, or labor organization.

(e) "Plant closing" means the announced or actual permanent shutdown of a single site
of employment, or one or more facilities or operating units within a single site of
employment.

(f) "Substantial layoff" means a permanent reduction in the workforce, which is not a
result of a plant closing, and which results in an employment loss at a single site of
employment during any 30-day period for at least 50 employees excluding those employees
that work less than 20 hours per week.

Sec. 2. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2022, section 116L.17, subdivision 5, new text end new text begin is repealed.
new text end

ARTICLE 2

JOB CREATION FUND

Section 1.

Minnesota Statutes 2022, section 116J.8748, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) For purposes of this section, the following terms have
the meanings given.

(b) "Agreement" or "business subsidy agreement" means a business subsidy agreement
under section 116J.994 that must include, but is not limited to: specification of the duration
of the agreement, job goals and a timeline for achieving those goals over the duration of
the agreement, construction and other investment goals and a timeline for achieving those
goals over the duration of the agreement, and the value of benefits the firm may receive
following achievement of capital investment and employment goals. The local government
and business must report to the commissioner on the business performance using the forms
developed by the commissioner.

(c) "Business" means an individual, corporation, partnership, limited liability company,
association, or other entity.

(d) "Capital investment" means money that is expended for the purpose of building or
improving real fixed property where employees under paragraphs (g) and (h) are or will be
employed and also includes construction materials, services, and supplies, and the purchase
and installation of equipment and machinery as provided under subdivision 4, paragraph
(b), clause (5).

(e) "Commissioner" means the commissioner of employment and economic development.

(f) "Minnesota job creation fund business" means a business that is designated by the
commissioner under subdivision 3.

(g) "Minority person" means a person belonging to a racial or ethnic minority as defined
in Code of Federal Regulations, title 49, section 23.5.

(h) "New full-time new text begin equivalent new text end employee" means an employee who:

(1) begins work at a Minnesota job creation fund business facility noted in a business
subsidy agreement and following the designation as a job creation fund business; and

(2) has expected work hours of at least 2,080 hours annually new text begin or the equivalent of
annualized expected hours of work equal to 2,080 hours of one or more employees new text end .

(i) "Persons with disabilities" means an individual with a disability, as defined under
the Americans with Disabilities Act, United States Code, title 42, section 12102.

(j) "Retained job new text begin equivalent new text end " means a full-time new text begin equivalent new text end position:

(1) that existed at the facility prior to the designation as a job creation fund business;
and

(2) has expected work hours of at least 2,080 hours annually new text begin or the equivalent of
annualized expected hours of work equal to 2,080 hours of one or more employees new text end .

(k) "Veteran" means a veteran as defined in section 197.447.

(l) "Wages" has the meaning given in section 290.92, subdivision 1, clause (1).

Sec. 2.

Minnesota Statutes 2023 Supplement, section 116J.8748, subdivision 3, is amended
to read:

Subd. 3.

Minnesota job creation fund business designation; requirements.

(a) To
receive designation as a Minnesota job creation fund business, a business must satisfy all
of the following conditions:

(1) the business is or will be engaged in, within Minnesota, one of the following as its
primary business activity:

(i) manufacturing;

(ii) warehousing;

(iii) distribution;

(iv) information technology;

(v) finance;

(vi) insurance; or

(vii) professional or technical services;

(2) the business must not be primarily engaged in lobbying; gambling; entertainment;
professional sports; political consulting; leisure; hospitality; or professional services provided
by attorneys, accountants, business consultants, physicians, or health care consultants, or
primarily engaged in making retail sales to purchasers who are physically present at the
business's location;

(3) the business must enter into a binding construction and job creation business subsidy
agreement with the commissioner to expend directly, or ensure expenditure by or in
partnership with a third party constructing or managing the project, at least $500,000 in
capital investment in a capital investment project that includes a new, expanded, or remodeled
facility within one year following designation as a Minnesota job creation fund business or
$250,000 if the project is located outside the metropolitan area as defined in section 200.02,
subdivision 24, or if 51 percent of the business is cumulatively owned by minorities, veterans,
women, or persons with a disability; and:

(i) create at least ten new full-time new text begin equivalent new text end employee positions within two years of
the benefit date following the designation as a Minnesota job creation fund business or five
new full-time new text begin equivalent new text end employee positions within two years of the benefit date if the
project is located outside the metropolitan area as defined in section 200.02, subdivision
24, or if 51 percent of the business is cumulatively owned by minorities, veterans, women,
or persons with a disability; or

(ii) expend at least $25,000,000, which may include the installation and purchase of
machinery and equipment, in capital investment and retain at least 100 new text begin full-time equivalent
new text end employees for projects located in the metropolitan area as defined in section 200.02,
subdivision 24, or expend at least $10,000,000, which may include the installation and
purchase of machinery and equipment, in capital investment and retain at least 50 new text begin full-time
equivalent new text end employees for projects located outside the metropolitan area;

(4) positions or employees moved or relocated from another Minnesota location of the
Minnesota job creation fund business must not be included in any calculation or determination
of job creation or new positions under this paragraph; and

(5) a Minnesota job creation fund business must not terminate, lay off, or reduce the
working hours of an employee for the purpose of hiring an individual to satisfy job creation
goals under this subdivision.

(b) Prior to approving the proposed designation of a business under this subdivision, the
commissioner shall consider the following:

(1) the economic outlook of the industry in which the business engages;

(2) the projected sales of the business that will be generated from outside the state of
Minnesota;

(3) how the business will build on existing regional, national, and international strengths
to diversify the state's economy;

(4) whether the business activity would occur without financial assistance;

(5) whether the business is unable to expand at an existing Minnesota operation due to
facility or land limitations;

(6) whether the business has viable location options outside Minnesota;

(7) the effect of financial assistance on industry competitors in Minnesota;

(8) financial contributions to the project made by local governments; and

(9) any other criteria the commissioner deems necessary.

(c) Upon receiving notification of local approval under subdivision 2, the commissioner
shall review the determination by the local government and consider the conditions listed
in paragraphs (a) and (b) to determine whether it is in the best interests of the state and local
area to designate a business as a Minnesota job creation fund business.

(d) If the commissioner designates a business as a Minnesota job creation fund business,
the business subsidy agreement shall include the performance outcome commitments and
the expected financial value of any Minnesota job creation fund benefits.

(e) The commissioner may amend an agreement once, upon request of a local government
on behalf of a business, only if the performance is expected to exceed thresholds stated in
the original agreement.

(f) A business may apply to be designated as a Minnesota job creation fund business at
the same location more than once only if all goals under a previous Minnesota job creation
fund agreement have been met and the agreement is completed.

Sec. 3.

Minnesota Statutes 2023 Supplement, section 116J.8748, subdivision 4, is amended
to read:

Subd. 4.

Certification; benefits.

(a) The commissioner may certify a Minnesota job
creation fund business as eligible to receive a specific value of benefit under paragraphs (b)
and (c) when the business has achieved its job creation and capital investment goals noted
in its agreement under subdivision 3.

(b) A qualified Minnesota job creation fund business may be certified eligible for the
benefits in this paragraph for up to five years for projects located in the metropolitan area
as defined in section 200.02, subdivision 24, and seven years for projects located outside
the metropolitan area, as determined by the commissioner when considering the best interests
of the state and local area. Notwithstanding section 16B.98, subdivision 5, paragraph (a),
clause (3), or 16B.98, subdivision 5, paragraph (b), grant agreements for projects located
outside the metropolitan area may be for up to seven years in length. The eligibility for the
following benefits begins the date the commissioner certifies the business as a qualified
Minnesota job creation fund business under this subdivision:

(1) up to five percent rebate for projects located in the metropolitan area as defined in
section 200.02, subdivision 24, and 7.5 percent for projects located outside the metropolitan
area, on capital investment on qualifying purchases as provided in subdivision 5 with the
total rebate for a project not to exceed $500,000;

(2) an award of up to $500,000 based on full-time job creation and wages paid as provided
in subdivision 6 with the total award not to exceed $500,000;

(3) up to $1,000,000 in capital investment rebates and $1,000,000 in job creation awards
are allowable for projects that have at least $25,000,000 in capital investment and 100 new
new text begin full-time equivalent new text end employees in the metropolitan area as defined in section 200.02,
subdivision 24, or at least $10,000,000 in capital investment and 50 new new text begin full-time equivalent
new text end employees for projects located outside the metropolitan area;

(4) up to $1,000,000 in capital investment rebates and up to $1,000,000 in job creation
awards are allowable for projects that have at least $25,000,000 in capital investment, which
may include the installation and purchase of machinery and equipment, and 100 retained
new text begin full-time equivalent new text end employees for projects located in the metropolitan area as defined in
section 200.02, subdivision 24, or at least $10,000,000 in capital investment, which may
include the installation and purchase of machinery and equipment, and 50 retained new text begin full-time
equivalent new text end employees for projects located outside the metropolitan area; and

(5) for clauses (3) and (4) only, the capital investment expenditure requirements may
include the installation and purchases of machinery and equipment. These expenditures are
not eligible for the capital investment rebate provided under subdivision 5.

(c) The job creation award may be provided in multiple years as long as the qualified
Minnesota job creation fund business continues to meet the job creation goals provided for
in its agreement under subdivision 3 and the total award does not exceed $500,000 except
as provided under paragraph (b), clauses (3) and (4). Under paragraph (b), clause (4), a job
creation award of $2,000 per new text begin full-time equivalent job new text end retained deleted text begin job deleted text end may be provided one time
if the qualified Minnesota job creation fund business meets the minimum capital investment
and retained employee requirement as provided in paragraph (b), clause (4), for at least two
years.

(d) No rebates or award may be provided until the Minnesota job creation fund business
or a third party constructing or managing the project has at least $500,000 in capital
investment in the project and at least ten full-time new text begin equivalent new text end jobs have been created and
maintained for at least one year or the retained employees, as provided in paragraph (b),
clause (4), remain for at least one year. The agreement may require additional performance
outcomes that need to be achieved before rebates and awards are provided. If fewer retained
jobs are maintained, but still above the minimum under this subdivision, the capital
investment award shall be reduced on a proportionate basis.

(e) The forms needed to be submitted to document performance by the Minnesota job
creation fund business must be in the form and be made under the procedures specified by
the commissioner. The forms shall include documentation and certification by the business
that it is in compliance with the business subsidy agreement, sections 116J.871 and 116L.66,
and other provisions as specified by the commissioner.

(f) Minnesota job creation fund businesses must pay each new full-time new text begin equivalent
new text end employee added pursuant to the agreement total compensation, including benefits not
mandated by law, that on an annualized basis is equal to at least 110 percent of the federal
poverty level for a family of four.

(g) A Minnesota job creation fund business must demonstrate reasonable progress on
capital investment expenditures within six months following designation as a Minnesota
job creation fund business to ensure that the capital investment goal in the agreement under
subdivision 1 will be met. Businesses not making reasonable progress will not be eligible
for benefits under the submitted application and will need to work with the local government
unit to resubmit a new application and request to be a Minnesota job creation fund business.
Notwithstanding the goals noted in its agreement under subdivision 1, this action shall not
be considered a default of the business subsidy agreement.

Sec. 4.

Minnesota Statutes 2023 Supplement, section 116J.8748, subdivision 6, is amended
to read:

Subd. 6.

Job creation award.

(a) A qualified Minnesota job creation fund business is
eligible for an annual award for each new new text begin full-time equivalent new text end job created and maintained
under subdivision 4, paragraph (b), clauses (2) and (3), by the business using the following
schedule: $1,000 for each job position paying annual wages at least $26,000 but less than
$35,000; $2,000 for each job position paying at least $35,000 but less than $45,000; $3,000
for each job position paying at least $45,000 but less than $55,000; and $4,000 for each job
position paying at least $55,000; and as noted in the goals under the agreement provided
under subdivision 1. These awards are increased by $1,000 if the business is located outside
the metropolitan area as defined in section 200.02, subdivision 24, or if 51 percent of the
business is cumulatively owned by minorities, veterans, women, or persons with a disability.

(b) A qualified Minnesota job creation fund business is eligible for a onetime $2,000
award for each new text begin full-time equivalent new text end job retained and maintained under subdivision 4,
paragraph (b), clause (4), provided that each retained job pays total compensation, including
benefits not mandated by law, that on an annualized basis is equal to at least 150 percent
of the federal poverty level for a family of four.

(c) The job creation award schedule must be adjusted annually using the percentage
increase in the federal poverty level for a family of four.

(d) Minnesota job creation fund businesses seeking an award credit provided under
subdivision 4 must submit forms and applications to the Department of Employment and
Economic Development as prescribed by the commissioner.

ARTICLE 3

INNOVATIVE BUSINESS DEVELOPMENT PUBLIC INFRASTRUCTURE GRANT
PROGRAM

Section 1.

Minnesota Statutes 2022, section 116J.435, subdivision 3, is amended to read:

Subd. 3.

Grant program established.

(a) The commissioner shall make deleted text begin competitive deleted text end
grants to local governmental units to acquire and prepare land on which public infrastructure
required to support an eligible project will be located deleted text begin , including demolition of structures
and remediation of any hazardous conditions on the land, or to predesign, design, acquire, deleted text end
new text begin and to new text end construct, furnish, and equip public infrastructure required to support an eligible
project. The local governmental unit receiving a grant must provide for the remainder of
the public infrastructure costs from other sources. deleted text begin The commissioner may waive the
requirements related to an eligible project under subdivision 2 if a project would be eligible
under this section but for the fact that its location requires infrastructure improvements to
residential development.
deleted text end

(b) The amount of a grant may not exceed deleted text begin the lesser of the cost of the public infrastructure
or deleted text end 50 percent of the sum of the cost of the public infrastructure deleted text begin plus the cost of the completed
eligible deleted text end project.

(c) The purpose of the program is to keep or enhance jobs in the area, increase the tax
base, or to expand or create new economic development through the growth of new
innovative businesses and organizations.

Sec. 2.

Minnesota Statutes 2022, section 116J.435, subdivision 4, is amended to read:

Subd. 4.

Application.

(a) The commissioner must develop forms and procedures for
soliciting and reviewing applications for grants under this section. At a minimum, a local
governmental unit must include deleted text begin the following information deleted text end in its application new text begin a resolution
certifying that the money required to be supplied by the local governmental unit to complete
the public infrastructure project is available and committed. The commissioner must evaluate
complete applications for eligible projects using the following criteria new text end :

(1) deleted text begin a resolution of its governing body certifying that the money required to be supplied
by the local governmental unit to complete the public infrastructure is available and
committed deleted text end new text begin the project is an eligible project as defined under subdivision 2 new text end ;

(2) deleted text begin a detailed estimate, along with necessary supporting evidence, of the total development
costs for the public infrastructure and eligible project deleted text end new text begin the project is expected to result in or
will attract substantial public and private capital investment and provide substantial economic
benefit to the county or city in which the project would be located new text end ;

(3) deleted text begin an assessment of the potential or likely use of the site for innovative business activities
after completion of the public infrastructure and eligible project deleted text end new text begin the project is not relocating
substantially the same operation from another location in the state, unless the commissioner
determines the project cannot be reasonably accommodated within the county or city in
which the business is currently located, or the business would otherwise relocate to another
state new text end ; new text begin and
new text end

(4) deleted text begin a timeline indicating the major milestones of the public infrastructure and eligible
project and their anticipated completion dates; deleted text end new text begin the project is expected to create or retain
full-time jobs.
new text end

deleted text begin (5) a commitment from the governing body to repay the grant if the milestones are not
realized by the completion date identified in clause (4); and
deleted text end

deleted text begin (6) any additional information or material the commissioner prescribes.
deleted text end

(b) The determination of whether to make a grant deleted text begin under subdivision 3 deleted text end new text begin for a site new text end is within
the discretion of the commissioner, subject to this section. The commissioner's decisions
and application of the deleted text begin priorities deleted text end new text begin criteria new text end are not subject to judicial review, except for abuse
of discretion.

Sec. 3. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2022, section 116J.435, subdivision 5, new text end new text begin is repealed.
new text end

ARTICLE 4

ENERGY TRANSITION ADVISORY COMMITTEE

Section 1.

Minnesota Statutes 2022, section 116J.5492, subdivision 2, is amended to read:

Subd. 2.

Membership.

(a) The advisory committee consists of deleted text begin 18 deleted text end new text begin 19 new text end voting members
and eight ex officio nonvoting members.

(b) The voting members of the advisory committee are appointed by the commissioner
of employment and economic development, except as specified below:

(1) two members of the senate, one appointed by the majority leader of the senate and
one appointed by the minority leader of the senate;

(2) two members of the house of representatives, one appointed by the speaker of the
house of representatives and one appointed by the minority leader of the house of
representatives;

(3) one representative of the Prairie Island Indian community;

(4) four representatives of impacted communities, of which two must represent counties
and two must represent municipalities, and, to the extent possible, of the impacted facilities
in those communities, at least one must be a coal plant, at least one must be a nuclear plant,
and at least one must be a natural gas plant;

(5) three representatives of impacted workers at impacted facilities;

(6) one representative of impacted workers employed by companies that, under contract,
regularly perform construction, maintenance, or repair work at an impacted facility;

(7) one representative with professional economic development or workforce retraining
experience;

(8) two representatives of utilities that operate an impacted facility;

(9) one representative from a nonprofit organization with expertise and experience
delivering energy efficiency and conservation programs; deleted text begin and
deleted text end

new text begin (10) one representative of a school district facing revenue loss due to energy transition;
and
new text end

deleted text begin (10) deleted text end new text begin (11) new text end one representative from the Coalition of Utility Cities.

(c) The ex officio nonvoting members of the advisory committee consist of:

(1) the governor or the governor's designee;

(2) the commissioner of employment and economic development or the commissioner's
designee;

(3) the commissioner of commerce or the commissioner's designee;

(4) the commissioner of labor and industry or the commissioner's designee;

(5) the commissioner of revenue or the commissioner's designee;

(6) the executive secretary of the Public Utilities Commission or the secretary's designee;

(7) the commissioner of the Pollution Control Agency or the commissioner's designee;
and

(8) the chancellor of the Minnesota State Colleges and Universities or the chancellor's
designee.

ARTICLE 5

TECHNICAL CHANGES

Section 1.

Laws 2023, chapter 53, article 15, section 32, subdivision 6, is amended to
read:

Subd. 6.

Administrative costs.

The commissioner of employment and economic
development may use up to one percent of the appropriation made for this section for
administrative expenses of the department. new text begin The Northland Foundation may use up to five
percent of the appropriation made for this section for administrative expenses.
new text end

Sec. 2. new text begin LAUNCH MINNESOTA 2023 APPROPRIATION.
new text end

new text begin The appropriation for Launch Minnesota in Laws 2023, chapter 53, article 20, section
2, subdivision 2, paragraph (c), is available until June 30, 2027.
new text end

ARTICLE 6

SMALL BUSINESS PROGRAM MODIFICATIONS

Section 1.

Minnesota Statutes 2023 Supplement, section 116J.682, subdivision 1, is
amended to read:

Subdivision 1.

Definitions.

(a) For the purposes of this section, the terms in this
subdivision have the meanings given.

(b) "Commissioner" means the commissioner of employment and economic development.

(c) "Partner organizations" or "partners" means:

(1) nonprofit organizations or public entities, including higher education institutions,
engaged in business development or economic development;

(2) community development financial institutions; deleted text begin or
deleted text end

(3) community development corporations new text begin ; and
new text end

new text begin (4) Tribal economic development entities new text end .

(d) "Small business" has the meaning given in section 3 of the Small Business Act,
United States Code, title 15, section 632.

(e) "Underserved populations and geographies" means individuals who are Black,
Indigenous, people of color, veterans, people with disabilities, people who are LGBTQ+,
and low-income individuals and includes people from rural Minnesota.

Sec. 2.

Minnesota Statutes 2023 Supplement, section 116J.682, subdivision 3, is amended
to read:

Subd. 3.

Small business assistance partnerships grants.

(a) The commissioner shall
make small business assistance partnerships grants to local and regional community-based
organizations to provide small business development and technical assistance services to
entrepreneurs and small business owners. The commissioner must prioritize applications
that provide services to underserved populations and geographies.

(b) Grantees shall use the grant funds to provide high-quality, free deleted text begin or low-cost deleted text end
professional business development and technical assistance services that support the start-up,
growth, and success of Minnesota's entrepreneurs and small business owners.

new text begin (c) Grantees may use up to 15 percent of grant funds for expenses incurred while
administering the grant, including but not limited to expenses related to technology, utilities,
legal services, training, accounting, insurance, financial management, benefits, reporting,
servicing of loans, and audits.
new text end

Sec. 3.

Minnesota Statutes 2023 Supplement, section 116J.682, subdivision 4, is amended
to read:

Subd. 4.

Report.

new text begin (a) new text end By January 31 of each year, partner organizations participating in
the program must provide a report to the commissioner on the outcomes of the program,
including but not limited to the number of entrepreneurs and small businesses served, number
of hours of business assistance services provided, number of new businesses started, number
of full-time equivalent jobs created and retained, and demographic and geographic details
of the individuals being served.

new text begin (b) By February 15 of each year, the commissioner must provide a report compiling the
information received from the partner organizations under paragraph (a) to the chairs and
ranking minority members of the legislative committees with jurisdiction over workforce
development. The report must also specify any partner organization that failed to provide
the information required under paragraph (a).
new text end

Sec. 3.

Minnesota Statutes 2023 Supplement, section 116J.8733, is amended to read:

116J.8733 MINNESOTA EXPANDING OPPORTUNITY FUND PROGRAM.

Subdivision 1.

Establishment.

The Minnesota Expanding Opportunity Fund Program
is established to capitalize Minnesota nonprofit corporations new text begin , Tribal economic development
entities, and community development financial institutions new text end to increase lending activities
with Minnesota small businesses.

Subd. 2.

Long-term loans.

The department may make long-term loans of ten to 12 years
at 0.5 percent or lower interest rates to nonprofit corporations new text begin , Tribal economic development
entities, and community development financial institutions new text end to enable nonprofit corporations new text begin ,
Tribal economic development entities, and community development financial institutions new text end
to make more loans to Minnesota small businesses. The department may use the interest
received to offset the cost of administering small business lending programs.

Subd. 3.

Loan eligibility deleted text begin ; nonprofit corporation deleted text end .

(a) The eligible nonprofit corporation new text begin ,
Tribal economic development entity, or community development financial institution new text end must
not meet the definition of recipient under section 116J.993, subdivision 6.

(b) The commissioner may enter into loan agreements with Minnesota nonprofit
corporations new text begin , Tribal economic development entities, and community development financial
institutions new text end that apply to participate in the Minnesota Expanding Opportunity Fund Program.
The commissioner shall evaluate applications from applicant nonprofit corporations new text begin , Tribal
economic development entities, and community development financial institutions new text end . In
evaluating applications, the department must consider, among other things, whether the
nonprofit corporation new text begin , Tribal economic development entity, or community development
financial institution new text end :

(1) meets the statutory definition of a community development financial institution as
defined in section 103 of the Riegle Community Development and Regulatory Improvement
Act of 1994, United States Code, title 12, section 4702;

(2) has a board of directors or loan or credit committee that includes citizens experienced
in small business services and community development;

(3) has the technical skills to analyze small business loan requests;

(4) is familiar with other available public and private funding sources and economic
development programs;

(5) is enrolled in one or more eligible federally funded state programs; and

(6) has the administrative capacity to manage a loan portfolio.

Subd. 4.

Revolving loan fund.

(a) The commissioner shall establish a revolving loan
fund to make loans to nonprofit corporations new text begin , Tribal economic development entities, and
community development financial institutions new text end for the purpose of increasing nonprofit
corporation new text begin , Tribal economic development entity, and community development financial
institution new text end capital and lending activities with Minnesota small businesses.

(b) Nonprofit corporations new text begin , Tribal economic development entities, and community
development financial institutions new text end that receive loans from the commissioner under the
program must establish appropriate accounting practices for the purpose of tracking eligible
loans.

Subd. 5.

Loan portfolio administration.

(a) The new text begin fee or new text end interest rate charged by a
nonprofit corporation new text begin , Tribal economic development entity, or community development
financial institution new text end for a loan under this subdivision must not exceed the Wall Street Journal
prime rate plus two percent. A nonprofit corporation new text begin , Tribal economic development entity,
or community development financial institution new text end participating in the Minnesota Expanding
Opportunity Fund Program may charge a loan closing fee equal to or less than two percent
of the loan value.

(b) The nonprofit corporation new text begin , Tribal economic development entity, or community
development financial institution new text end may retain all earnings from fees and interest from loans
to small businesses.

new text begin (c) The department must provide the nonprofit corporation, Tribal economic development
entity, or community development financial institution making the loan with a fee equal to
one percent of the loan value for every loan closed to offset related expenses for loan
processing, loan servicing, legal filings, and reporting.
new text end

Subd. 6.

Cooperation.

A nonprofit corporation new text begin , Tribal economic development entity,
or community development financial institution new text end that receives a program loan shall cooperate
with other organizations, including but not limited to community development corporations,
community action agencies, and the Minnesota small business development centers.

Subd. 7.

Reporting requirements.

(a) A nonprofit corporation new text begin , Tribal economic
development entity, or community development financial institution new text end that receives a program
loan must submit an annual report to the commissioner by February 15 of each year that
includes:

(1) the number of businesses to which a loan was made;

(2) a description of businesses supported by the program;

(3) demographic information, as specified by the commissioner, regarding each borrower;

(4) an account of loans made during the calendar year;

(5) the program's impact on job creation and retention;

(6) the source and amount of money collected and distributed by the program;

(7) the program's assets and liabilities; and

(8) an explanation of administrative expenses.

(b) A nonprofit corporation new text begin , Tribal economic development entity, or community
development financial institution new text end that receives a program loan must provide for an
independent annual audit to be performed in accordance with generally accepted accounting
practices and auditing standards and submit a copy of each annual audit report to the
commissioner.

Sec. 4.

Minnesota Statutes 2022, section 116M.18, is amended to read:

116M.18 MINNESOTA EMERGING ENTREPRENEUR PROGRAM.

Subdivision 1.

Establishment.

The Minnesota emerging entrepreneur program is
established to award grants to nonprofit corporations new text begin , Tribal economic development entities,
and community development financial institutions new text end to fund loans to businesses owned by
minority or low-income persons, women, veterans, or people with disabilities.

Subd. 1a.

Statewide loans.

To the extent there is sufficient eligible demand, loans shall
be made so that an approximately equal dollar amount of loans are made to businesses in
the metropolitan area as in the nonmetropolitan area. After March 31 of each fiscal year,
the department may allow loans to be made anywhere in the state without regard to
geographic area.

Subd. 1b.

Grants.

The department shall make grants to nonprofit corporations new text begin , Tribal
economic development entities, and community development financial institutions new text end to fund
loans to businesses owned by minority or low-income persons, women, veterans, or people
with disabilities to encourage private investment, to provide jobs for minority and low-income
persons, to create and strengthen minority business enterprises, and to promote economic
development in a low-income area.

Subd. 2.

Grant eligibility deleted text begin ; nonprofit corporation deleted text end .

(a) The department may enter into
agreements with nonprofit corporations new text begin , Tribal economic development entities, and
community development financial institutions new text end to fund loans the nonprofit corporation new text begin , Tribal
economic development entity, or community development financial institution new text end makes to
businesses owned by minority or low-income persons, women, veterans, or people with
disabilities. The department shall evaluate applications from nonprofit corporations new text begin , Tribal
economic development entities, and community development financial institutions new text end . In
evaluating applications, the department must consider, among other things, whether the
nonprofit corporation new text begin , Tribal economic development entity, or community development
financial institution new text end :

(1) has a board of directors that includes citizens experienced in business and community
development, minority business enterprises, addressing racial income disparities, and creating
jobs for low-income and minority persons;

(2) has the technical skills to analyze projects;

(3) is familiar with other available public and private funding sources and economic
development programs;

(4) can initiate and implement economic development projects;

(5) can establish and administer a revolving loan account or has operated a revolving
loan account;

(6) can work with job referral networks which assist minority and low-income persons;
and

(7) has established relationships with minority communities.

(b) The department shall review existing agreements with nonprofit corporations new text begin , Tribal
economic development entities, and community development financial institutions new text end every
five years and may renew or terminate the agreement based on the review. In making its
review, the department shall consider, among other criteria, the criteria in paragraph (a). new text begin
The department shall open the program to new applicants every two years.
new text end

Subd. 3.

Revolving loan fund.

(a) The department shall establish a revolving loan fund
to make grants to nonprofit corporations new text begin , Tribal economic development entities, and
community development financial institutions new text end for the purpose of making loans to businesses
owned by minority or low-income persons, women, veterans, or people with disabilities,
and to support minority business enterprises and job creation for minority and low-income
persons.

(b) Nonprofit corporations new text begin , Tribal economic development entities, and community
development financial institutions new text end that receive grants from the department under the program
must establish a commissioner-certified revolving loan fund for the purpose of making
eligible loans.

(c) Eligible business enterprises include, but are not limited to, technologically innovative
industries, value-added manufacturing, and information industries.

(d) Loan applications given preliminary approval by the nonprofit corporation new text begin , Tribal
economic development entity, or community development financial institution new text end must be
forwarded to the department deleted text begin for approval deleted text end . deleted text begin The commissioner must give final approval for
each loan made by the nonprofit corporation. deleted text end new text begin Nonprofit corporations, Tribal economic
development entities, and community development financial institutions designated as
preferred partners do not need final approval by the commissioner. All other loans must be
approved by the commissioner and the commissioner must make approval decisions within
20 days of receiving a loan application unless the application contains insufficient information
to make an approval decision. new text end The amount of the state funds contributed to any loan may
not exceed 50 percent of each loan. new text begin The commissioner must develop the criteria necessary
to receive loan forgiveness.
new text end

Subd. 4.

Business loan criteria.

(a) The criteria in this subdivision apply to loans made
by nonprofit corporations new text begin , Tribal economic development entities, and community
development financial institutions new text end under the program.

(b) Loans must be made to businesses that are not likely to undertake a project for which
loans are sought without assistance from the program.

(c) A loan must be used to support a business owned by a minority or a low-income
person, woman, veteran, or a person with disabilities. Priority must be given for loans to
the lowest income areas.

(d) The minimum state contribution to a loan is $5,000 and the maximum is $150,000.

(e) The state contribution must be matched by at least an equal amount of new private
investment.

(f) A loan may not be used for a retail development project.

(g) The business must agree to work with job referral networks that focus on minority
and low-income applicants.

(h) Up to ten percent of a loan's principal amount may be forgiven if deleted text begin the department
approves and deleted text end the borrower has met lender new text begin and agency new text end criteria new text begin , new text end including being current with
all payments new text begin , for at least two years new text end . new text begin The commissioner must develop the criteria for receiving
loan forgiveness.
new text end

Subd. 4a.

Microenterprise loan.

(a) Program grants may be used to make microenterprise
loans to small, beginning businesses, including a sole proprietorship. Microenterprise loans
are subject to this section except that:

(1) they may also be made to qualified retail businesses;

(2) they may be made for a minimum of $5,000 and a maximum of deleted text begin $35,000 deleted text end new text begin $40,000 new text end ;

(3) in a low-income area, they may be made for a minimum of $5,000 and a maximum
of deleted text begin $50,000 deleted text end new text begin $55,000 new text end ; and

(4) they do not require a match.

(b) Up to ten percent of a loan's principal amount may be forgiven if deleted text begin the department
approves and deleted text end the borrower has met deleted text begin lender deleted text end criteria new text begin developed by the lender and the
commissioner, new text end including being current with all payments new text begin , for at least two years new text end .

Subd. 5.

Revolving fund administration.

(a) The department shall establish a minimum
interest rate new text begin or fee new text end for loans or guarantees to ensure that necessary loan administration costs
are covered. The interest rate charged by a nonprofit corporation new text begin , Tribal economic
development entity, or community development financial institution new text end for a loan under this
subdivision must not exceed the Wall Street Journal prime rate plus deleted text begin four deleted text end new text begin two new text end percent new text begin , with
a maximum rate of ten percent new text end . For a loan under this subdivision, the nonprofit corporation new text begin ,
Tribal economic development entity, or community development financial institution new text end may
charge a loan origination fee equal to or less than one percent of the loan value. The nonprofit
corporation new text begin , Tribal economic development entity, or community development financial
institution new text end may retain the amount of the origination fee.

(b) Loan repayment of principal must be paid to the department for deposit in the
revolving loan fund. Loan interest payments must be deposited in a revolving loan fund
created by the nonprofit corporation new text begin , Tribal economic development entity, or community
development financial institution new text end originating the loan being repaid for further distribution
or use, consistent with the criteria of this section.

(c) Administrative expenses of the nonprofit corporations new text begin , Tribal economic development
entities, and community development financial institutions new text end with whom the department enters
into agreements, including expenses incurred by a nonprofit corporation new text begin , Tribal economic
development entity, or community development financial institution new text end in providing financial,
technical, managerial, and marketing assistance to a business enterprise receiving a loan
under subdivision 4, may be paid out of the interest earned on loans and out of interest
earned on money invested by the state Board of Investment under section 116M.16,
subdivision 2, as may be provided by the department.

new text begin (d) The department must provide the nonprofit corporation, Tribal economic development
entity, or community development financial institution making the loan with a fee equal to
one percent of the loan value for every loan closed to offset related expenses for loan
processing, loan servicing, legal filings, and reporting.
new text end

Subd. 7.

Cooperation.

A nonprofit corporation new text begin , Tribal economic development entity,
or community development financial institution new text end that receives a program grant shall cooperate
with other organizations, including but not limited to, community development corporations,
community action agencies, and the Minnesota small business development centers.

Subd. 8.

Reporting requirements.

new text begin (a) new text end A nonprofit corporation new text begin , Tribal economic
development entity, or community development financial institution new text end that receives a program
grant shall:

(1) submit an annual report to the department by February 15 of each year that includes
a description of businesses supported by the grant program, an account of loans made during
the calendar year, the program's impact on minority business enterprises and job creation
for minority persons and low-income persons, the source and amount of money collected
and distributed by the program, the program's assets and liabilities, and an explanation of
administrative expenses; and

(2) provide for an independent annual audit to be performed in accordance with generally
accepted accounting practices and auditing standards and submit a copy of each annual
audit report to the department.

new text begin (b) By March 1 of each year, the commissioner must provide a report compiling the
information received from nonprofit corporations, Tribal economic development entities,
and community development financial institutions under paragraph (a) to the chairs and
ranking minority members of the legislative committees with jurisdiction over workforce
development. The report must also specify any nonprofit corporations, Tribal economic
development entities, or community development financial institutions that failed to provide
the information required under paragraph (a).
new text end

Subd. 9.

Small business emergency loan account.

The small business emergency loan
account is created as an account in the special revenue fund.

Sec. 5.

Laws 2023, chapter 53, article 15, section 33, subdivision 4, is amended to read:

Subd. 4.

Loans to community businesses.

(a) A partner organization that receives a
grant under subdivision 3 shall establish a plan for making low-interest loans to community
businesses. The plan requires approval by the commissioner.

(b) Under the plan:

(1) the state contribution to each loan shall be no less than $50,000 and no more than
$500,000;

(2) loans shall be made for projects that are unlikely to be undertaken unless a loan is
received under the program;

(3) priority shall be given to loans to businesses in the lowest income areas;

(4) the new text begin fee or new text end interest rate on a loan shall not be higher than deleted text begin the Wall Street Journal prime deleted text end
new text begin a new text end rate new text begin of ten percent new text end ;

(5) 50 percent of all repayments of principal on a loan under the program shall be used
to fund additional new text begin related new text end lending. The partner organization may retain the remainder of
loan repayments to service loans and provide further technical assistance;

(6) the partner organization may charge a loan origination fee of no more than one
percent of the loan value and may retain that origination fee; deleted text begin and
deleted text end

(7) a partner organization may not make a loan to a project in which it has an ownership
interest deleted text begin . deleted text end new text begin ; and
new text end

new text begin (8) up to 15 percent of a loan's principal amount may be forgiven by the partner
organization if the borrower has met all lending criteria developed by the partner organization
and the commissioner, including creating or retaining jobs and being current with all loan
payments, for at least two years.
new text end

Sec. 6.

Laws 2023, chapter 53, article 15, section 33, subdivision 5, is amended to read:

Subd. 5.

Reports.

(a) The partner organization shall submit a report to the commissioner
by deleted text begin January deleted text end new text begin December new text end 31 of 2024, 2025, and 2026. The report shall include:

(1) an account of all loans made through the program the preceding calendar year and
the impact of those loans on community businesses and job creation for targeted groups;

(2) information on the source and amount of money collected and distributed under the
program, its assets and liabilities, and an explanation of administrative expenses; and

(3) an independent audit of grant funds performed in accordance with generally accepted
accounting practices and auditing standards.

(b) By February 15 of deleted text begin 2024, deleted text end 2025, deleted text begin and deleted text end 2026, new text begin and 2027, new text end the commissioner shall submit
a report to the chairs and ranking minority members of the legislative committees with
jurisdiction over workforce and economic development on program outcomes, including
copies of all reports received under paragraph (a).

ARTICLE 7

INDEPENDENT LIVING SERVICES

Section 1.

Minnesota Statutes 2022, section 268A.11, is amended to read:

268A.11 INDEPENDENT LIVING SERVICES.

Subdivision 1.

Purposes and services.

The purposes of independent living services and
the services that are to be provided are those that are consistent with Code of Federal
Regulations, title deleted text begin 34, parts 365 to 367 deleted text end new text begin 45, part 1329 new text end .

Subd. 2.

Administration.

This section shall be administered by the Department of
Employment and Economic Development through new text begin the Vocational new text end Rehabilitation Services new text begin
Program new text end . The department may employ staff as reasonably required to administer this section
and may accept and receive funds from nonstate sources for the purpose of effectuating this
section.

Subd. 3.

Certification.

No applicant Center for Independent Living may receive funding
under this section unless it has received certification from new text begin the Vocational new text end Rehabilitation
Services new text begin Program new text end .

new text begin The Vocational new text end Rehabilitation Services new text begin Program new text end shall review the programs of Centers
for Independent Living receiving funds deleted text begin from deleted text end new text begin under new text end this section to determine deleted text begin their adherence
to deleted text end new text begin compliance with the new text end standards deleted text begin adopted by rule and if the standards are substantially met deleted text end new text begin
defined in section 725(b) and assurances in section 725(c) of the Rehabilitation Act of 1973 new text end ,
new text begin and, if fulfilled, new text end shall issue appropriate certifications.

Subd. 4.

Application of Centers for Independent Living.

new text begin The Vocational new text end Rehabilitation
Services new text begin Program new text end shall require Centers for Independent Living to complete application
forms, expenditure reports, and proposed plans and budgets. These reports must be in the
manner and on the form prescribed by new text begin the Vocational new text end Rehabilitation Services new text begin Program new text end .
When applying, the Center for Independent Living shall agree to provide reports and records deleted text begin , deleted text end
and make available records for audit as may be required by new text begin the Vocational new text end Rehabilitation
Services new text begin Program new text end .

The applicant Center for Independent Living shall be notified in writing by new text begin the Vocational
new text end Rehabilitation Services new text begin Program new text end concerning the approval of budgets and plans.

ARTICLE 8

PUBLIC FACILITIES AUTHORITY

Section 1.

Minnesota Statutes 2022, section 446A.072, subdivision 5a, is amended to read:

Subd. 5a.

Type and amount of assistance.

(a) For a governmental unit receiving grant
funding from the USDA/RECD, the authority may provide assistance in the form of a grant
of up to 65 percent of the eligible grant need determined by USDA/RECD. A governmental
unit may not receive a grant under this paragraph for more than deleted text begin $5,000,000 deleted text end new text begin $10,000,000 new text end
per project or $20,000 per existing connection, whichever is less, unless specifically approved
by law.

(b) For a governmental unit receiving a loan from the clean water revolving fund under
section 446A.07, the authority may provide assistance under this section in the form of a
grant if the average annual residential wastewater system cost after completion of the project
would otherwise exceed 1.4 percent of the median household income of the project service
area. In determining whether the average annual residential wastewater system cost would
exceed 1.4 percent, the authority must consider the total costs associated with building,
operating, and maintaining the wastewater system, including existing wastewater debt
service, debt service on the eligible project cost, and operation and maintenance costs. Debt
service costs for the proposed project are calculated based on the maximum loan term
permitted for the clean water revolving fund loan under section 446A.07, subdivision 7.
The amount of the grant is equal to 80 percent of the amount needed to reduce the average
annual residential wastewater system cost to 1.4 percent of median household income in
the project service area, to a maximum of deleted text begin $5,000,000 deleted text end new text begin $10,000,000 new text end per project or $20,000
per existing connection, whichever is less, unless specifically approved by law. The eligible
project cost is determined by multiplying the total project costs minus any other grants by
the essential project component percentage calculated under subdivision 3, paragraph (c),
clause (1). In no case may the amount of the grant exceed 80 percent of the eligible project
cost.

(c) For a governmental unit receiving a loan from the drinking water revolving fund
under section 446A.081, the authority may provide assistance under this section in the form
of a grant if the average annual residential drinking water system cost after completion of
the project would otherwise exceed 1.2 percent of the median household income of the
project service area. In determining whether the average annual residential drinking water
system cost would exceed 1.2 percent, the authority must consider the total costs associated
with building, operating, and maintaining the drinking water system, including existing
drinking water debt service, debt service on the eligible project cost, and operation and
maintenance costs. Debt service costs for the proposed project are calculated based on the
maximum loan term permitted for the drinking water revolving fund loan under section
446A.081, subdivision 8, paragraph (c). The amount of the grant is equal to 80 percent of
the amount needed to reduce the average annual residential drinking water system cost to
1.2 percent of median household income in the project service area, to a maximum of
deleted text begin $5,000,000 deleted text end new text begin $10,000,000 new text end per project or $20,000 per existing connection, whichever is less,
unless specifically approved by law. The eligible project cost is determined by multiplying
the total project costs minus any other grants by the essential project component percentage
calculated under subdivision 3, paragraph (c), clause (1). In no case may the amount of the
grant exceed 80 percent of the eligible project cost.

(d) Notwithstanding the limits in paragraphs (a), (b), and (c), for a governmental unit
receiving supplemental assistance under this section after January 1, 2002, if the authority
determines that the governmental unit's construction and installation costs are significantly
increased due to geological conditions of crystalline bedrock or karst areas and discharge
limits that are more stringent than secondary treatment, the maximum award under this
section shall not be more than $25,000 per existing connection.

Sec. 2.

Minnesota Statutes 2022, section 446A.073, subdivision 1, is amended to read:

Subdivision 1.

Program established.

When money is appropriated for grants under this
program, the authority shall award grants up to a maximum of deleted text begin $7,000,000 deleted text end new text begin $12,000,000 new text end to
governmental units to cover 80 percent of the cost of water infrastructure projects made
necessary by:

(1) a wasteload reduction prescribed under a total maximum daily load plan required by
section 303(d) of the federal Clean Water Act, United States Code, title 33, section 1313(d);

(2) a phosphorus concentration or mass limit which requires discharging one milligram
per liter or less at permitted design flow which is incorporated into a permit issued by the
Pollution Control Agency;

(3) any other water quality-based effluent limit established under section 115.03,
subdivision 1, paragraph (e), clause (8), and incorporated into a permit issued by the Pollution
Control Agency that exceeds secondary treatment limits; or

(4) a total nitrogen concentration or mass limit that requires discharging ten milligrams
per liter or less at permitted design flow.

APPENDIX

Repealed Minnesota Statutes: S4027-1

116J.435 INNOVATIVE BUSINESS DEVELOPMENT PUBLIC INFRASTRUCTURE GRANT PROGRAM.

Subd. 5.

Priorities.

(a) If applications for grants exceed the available appropriations, grants must be made for public infrastructure that, in the commissioner's judgment, provides the highest return in public benefits for the public costs incurred. "Public benefits" include job creation, environmental benefits to the state and region, efficient use of public transportation, efficient use of existing infrastructure, provision of affordable housing, multiuse development that constitutes community rebuilding rather than single-use development, crime reduction, blight reduction, community stabilization, and property tax base maintenance or improvement. In making this judgment, the commissioner shall give priority to eligible projects with one or more of the following characteristics:

(1) the potential of the local governmental unit to attract viable innovative businesses;

(2) proximity to public transit if located in a metropolitan county, as defined in section 473.121, subdivision 4;

(3) multijurisdictional eligible projects that take into account the need for affordable housing, transportation, and environmental impact;

(4) the eligible project is not relocating substantially the same operation from another location in the state, unless the commissioner determines the eligible project cannot be reasonably accommodated within the local governmental unit in which the business is currently located, or the business would otherwise relocate to another state or country; and

(5) the number of jobs that will be created.

(b) The factors in paragraph (a) are not listed in a rank order of priority; rather, the commissioner may weigh each factor, depending upon the facts and circumstances, as the commissioner considers appropriate.

116L.17 STATE DISLOCATED WORKER PROGRAM.

Subd. 5.

Cost limitations.

(a) Funds allocated to a grantee are subject to the following cost limitations:

(1) no more than ten percent may be allocated for administration;

(2) at least 50 percent must be allocated for training assistance as provided in subdivision 4, clause (4); and

(3) no more than 15 percent may be allocated for support services as provided in subdivision 4, clause (2).

(b) A waiver of the training assistance minimum in clause (4) may be sought, but no waiver shall allow less than 30 percent of the grant to be spent on training assistance. A waiver of the support services maximum in clause (2) may be sought, but no waiver shall allow more than 20 percent of the grant to be spent on support services. A waiver may be granted below the minimum and above the maximum otherwise allowed by this paragraph if funds other than state funds appropriated for the dislocated worker program are used to fund training assistance.