regional & State Funding
Regional & State Funding Opportunities
Minnesota PACE, or Property Assessed Clean Energy, is a financing tool that allows commercial property owners to invest in energy efficiency upgrades and renewable energy installations. The Saint Paul Port Authority is the program’s administering agency, and has joint powers agreements with both Wabasha and Goodhue Counties to work with commercial property owners in Lake City.
For qualifying projects, MinnPACE covers 100% of all project costs. After the project is complete, payments are repaid through a special property tax assessment for up to 20 years. In addition to utilizing MinnPACE, commercial property owners can stack local and federal incentives on top of the program, including energy rebates from Lake City Public Utility and solar tax credits through the Inflation Reduction Act.
Qualifying Expenses
- Energy audits / renewable energy studies
- Equipment costs
- Installation costs
- Energy evaluations
- Design, drafting, engineering, labor costs
- Permit fees
- Inspection charges
Qualifying Equipment
Energy-Efficiency Upgrades:
- HVAC Systems
- Lighting
- Building Envelope
- Energy Management System
Renewable Energy Sources:
- Solar
- Wing
- Geothermal
The Minnesota Department of Employment and Economic Development (DEED) administers a Job Training Incentive Program that provides grants to help new or expanding businesses train new workers as quickly and efficiently as possible. In order to be eligible for a grant, businesses must be located in Greater Minnesota and be adding a minimum of three new jobs.
New jobs created must be permanent positions that provide 32 hours of work per week for a minimum of nine months a year and pay wages at least equal to 120% of federal poverty guidelines for a family of four. For 2024, this is $37,440 per year. Businesses are required to match the grant on a .5:1 ratio. Grants up to $200,000 are available, with the award amount limited to $5,000 - $10,000 per new employee trained (based on wage rates).
Eligible Projects
Funds may only be used towards training for new jobs. Funds may be used for direct training costs including:
- Assessment
- Testing and Certification
- Curriculum Development
- Training Delivery
- Trainee Wages
- Training Materials and Supplies
- Training Equipment and Facilities
- Trainer Travel and Lodging Costs
The Minnesota Department of Employment and Economic Development (DEED) administers an Automation Training Incentive Program that provides grant to help small businesses train existing workers as quickly and efficiently as possible on new automation equipment and technology. In order to be eligible for a grant, businesses must be located in Greater Minnesota, have 150 or fewer full-time employees, operate in the manufacturing or skilled assembly production industry and have recently invested in new automation technology.
Training is for existing jobs that provide at least 32 hours of work per week for a minimum of nine months a year and pay wages of at least equal 120% of the federal poverty guidelines for a family of four. For 2024, this is $37,440 per year. Grants up to $35,000 are available, with the award amount limited to $5,000 per employee trained.
Eligible Projects
Funds may only be used towards training for workers on new automation technology. Funds may be used for direct training costs including:
- Assessment
- Testing and Certification
- Curriculum Development
- Training Delivery
- Trainee Wages
- Training Materials and Supplies
- Training Equipment and Facilities
- Trainer Travel and Lodging Costs
The Minnesota Department of Employment and Economic Development (DEED) administers an Employer Reasonable Accommodation Fund (ERAF) that allows small to mid-size Minnesota employers to request reimbursement for expenses related to providing reasonable accommodations for job applicants and employees with disabilities. The ERAF’s purpose is to encourage employment of people with disabilities by reducing any perceived or real financial barriers.
Reasonable accommodations may include, but are not limited to:
- Making facilities readily accessible to and usable by the individual with a disability;
- Job restructuring;
- Modified work schedules;
- Reassignment to a vacant position;
- Acquisition or modification of equipment or devices; and
- The provision of aides on a temporary or periodic basis.
The maximum total reimbursement per eligible employer in a state fiscal year is $30,000. Submissions for onetime reasonable accommodation expenses must be no less than $250 and no more than $15,000 per individual with a disability.
The Greater Minnesota Job Expansion Program provides tax benefits to businesses located in Greater Minnesota that increase employment. Qualifying businesses that meet job-growth goals may receive sales tax refunds for purchases made during a seven-year period.
Purchases and use of tangible personal property and taxable services made by a qualified business are eligible for a sales tax refund. The purchase must be made, and the property or service must be delivered, during the business’ certification period. The purchase and use of construction materials and supplies for property improvements by a qualified business in Greater Minnesota are also eligible for sales tax refund.
Eligibility Qualifications
- Increase employment at the business’s facility by a minimum of two full time equivalent employees or 10% of the current number of employees, whichever is greater, in three years
- Pay compensation, which includes wages and benefits not mandated by law, equals at least 120% of the federal poverty guidelines for a family of four ($37,440 per year or $18.00 per hour)
- Be in operation for at least one year within a city in Greater Minnesota
- Meet prevailing wage guidelines at the business facility if a construction or improvement project is undertaken and if the business is awarded a sales tax refund
- Does not sell goods or services primarily to local markets; the program is for businesses with sales and customers primarily outside of Minnesota
Launch Minnesota is a statewide collaborative effort to accelerate the growth of startups and amplify Minnesota as a national leader in innovation. Innovation grants are targeted to the most promising innovative scalable technology businesses in Minnesota. The 2023 Minnesota Legislature authorized grant program funding in the amount of $1.5 million for each fiscal year 2024 and 2025.
The innovation grant reimburses business expenses, incurred in Minnesota, for research and development direct business expenses and the purchase of technical assistance and services. Qualifying businesses may receive grants up to $35,000, which are disbursed on a 2:1 reimbursement basis.
Eligibility Requirements
- Primary business activity is in innovative technology or in an innovative business model or product
- Business operations and headquarters are located in Minnesota
- Businesses has not been in operation for more than 10 years
- Business has raised less than $1 million in equity financing
- Business has not previously received a Launch Minnesota Innovation Grant
Application Periods
- June 1, 2024 – June 30, 2024
- November 1, 2024 – November 29, 2024
- April 1, 2025 – April 30, 2025
Minnesota’s Angel Tax Credit provides a 25% credit to investors or investment funds that make equity investments in startup companies focused on high technology, new proprietary technology, or a new proprietary product, process or service in specified fields. The maximum credit is $125,000 per person, per year. For 2024, $5 million in credits is available, $2.5 million of which is reserved for minority- and women-owned businesses, as well as businesses located in Greater Minnesota.
Eligibility Requirements
- Be headquartered in Minnesota
- Have a minimum of 51% of employees, 51% of payroll and 51% of the value of current service contracts performed in Minnesota
- Have fewer than 25 employees
- Pay employees annual wages of at least 175% of the poverty level for a family of four ($54,600 per year or $26.25 per hour)
- Not have been in operation for more than 10 years (20 years for medical devices or pharmaceuticals)
- Not have issued securities that are traded on a public exchange, or begin trading within 180 days after a qualified investment
- Not previously have received private equity investments of more than $4 million
- Not have generated more than $4 million in investments that have received an Angel Tax Credit
- Be certified by DEED before investment is made
Technological Innovation Qualification
The primary business activity must include one or more of the following:
- Using proprietary technology to add value to a product, process or service in a qualified high-technology field
- Researching or developing a proprietary product, process or service in a high-technology field
- Researching, developing or producing a new proprietary technology for use in the fields of: agriculture, tourism, forestry, mining, manufacturing, or transportation
- Researching or developing a proprietary product, process or service in the fields of agriculture, tourism, forestry, mining, manufacturing or transportation
Applying for the Angel Tax Credit is a four-step process: Certification, Credit Allocation, Proof of Investment and Annual Report.
The Minnesota Pollution Control Agency (MPCA) has 0% interest loans available to small businesses for capital equipment purchases that help the company meet or exceed environmental regulations and cover costs associated with the investigation and cleanup of contaminated sites.
Eligibility
The loan program can be used for clean-ups of contaminated sites or projects that reduce on-site air emissions or waste generation. This program is not intended for projects where energy efficiency is the sole environmental benefit, such as the purchase of vehicles or upgrades of lighting or HVAC systems.
Qualified borrowers must be an existing small business corporation, sole proprietorship, partnership or association with:
- Less than 100 full-time employees;
- An after-tax profit of less than $500,000; and
- A demonstrated ability to repay the loan.
Eligible loans are in between $1,000 and $75,000, with a seven-year repayment term.
The Safety Grant Program awards funds up to $10,000 to qualifying employers for projects designed to reduce the risk of injury and illness to their workers.
Eligibility
To qualify, an employer must meet the following conditions:
- Has been in business for at least two years;
- Has at least one employee to create the employer / employee relationship;
- Has workers’ compensation insurance;
- Has had an on-site hazard survey conducted by a qualified safety professional and a written report of the findings and recommendations to reduce the risk of injury or illness to employees;
- Has the knowledge and experience to complete the project and is committed to its implementation; and
- Is able to complete the project within 120 days of a fully executed contract.
Eligible projects include:
- Purchasing and installing recommended safety or health equipment;
- Training for purchased safety or health equipment;
- Tuition reimbursement;
- The cost of operating or maintaining safety or health equipment; and
- Purchasing or renting real property, if necessary, to meet criteria established by the on-site safety and health survey.
Administered by the Minnesota Office of Higher Education (OHE), the Dual Training Grant helps employers meet their workforce needs by pairing on-the-job training with formal related instruction, resulting in employees earning an industry credential.
Eligible Industries:
- Advanced Manufacturing
- Agriculture
- Health Care Services
- Information Technology
- Child Care
- Legal Cannabis
- Transportation
Employers may be awarded up to $150,000 a year ($6,000 per trainee). Employers will also be able to apply for up to $15,000 in additional funds to be used for trainee supports.
Requests for proposals closed April 22, 2024. Applicants will be notified of awards by May 31, 2024.
The Southern Minnesota Initiative Foundation (SMIF) is a certified lender for the Minnesota Emerging Entrepreneur Loan Program (EELP). The EELP supports the growth of businesses owned and operated by minorities, low-income persons, women, veterans and/or persons with disabilities.
Funds can be used for machinery or equipment, inventory, working capital, new construction, renovation and site acquisition. In order to be eligible for a loan, businesses must project sufficient income to repay the loan within a determined timeframe.
The maximum loan amount is $15,000. Loan terms can be up to six years, and interest rates are negotiable.
The Southern Minnesota Initiative Foundation (SMIF) is granting $1.1 million in funds to small businesses in south central and southeastern Minnesota. The grants are funded by a one-time allocation from the State of Minnesota Legislature in partnership with the Minnesota Department of Employment and Economic Development. This grant program looks to drive economic recovery in our region through grants to small businesses experiencing lack of access to capital, loss of population or an aging population, or a lack of regional economic diversification.
In order to be eligible, businesses had to have $750,000 or less in gross revenue, based on their 2021 taxes. In addition, businesses had to have either not received pandemic relief grants from the state of Minnesota, received $10,000 or less in pandemic relief grants from the state of Minnesota or experienced 10% or greater decrease in gross revenue in 2022 as compared to 2021.
Businesses can use funds for working capital, included but not limited to: payroll expenses, rent or mortgage payments, utility bills and equipment.
Applications are due by April 24, 2024.
The Southern Minnesota Initiative Foundation (SMIF) provides loans to businesses operating in six key fields: bioscience, renewable energy, food/agriculture, manufacturing and healthcare.
Funds can be used for building acquisition, expansion, machinery or equipment, inventory and working capital. In order to be eligible for a loan, businesses must have financial participation from a local lender and demonstrated industry experience.
The maximum loan amount is $200,000, but awarded loans cannot exceed 50% of the project costs. Loan terms can be up to 15 years, and interest rates are negotiable.
The Southern Minnesota Initiative Foundation (SMIF) provides micro-loans to support small business owners or start-up entrepreneurs who create service, retail, local foods or manufacturing businesses.
Funds can be used for inventory, supplies, working capital and machinery or equipment. In order to be eligible for a loan, businesses must demonstrate an inability to obtain sufficient financing from a traditional lender and project sufficient income to repay the loan within a determined timeframe.
The maximum loan amount is $35,000. Loan terms can be up to 6 years, and interest rates are negotiable. Free technical assistance is included with loan awards.
The Southern Minnesota Initiative Foundation (SMIF) provides low-interest loans to support small-scale farmers beginning or expanding their operations.
Funds can be used for inventory, supplies, working capital and machinery or equipment. In order to be eligible for a loan, farmers must be unable to obtain other project financing and project sufficient income to repay the loan within a determined timeframe.
The maximum loan amount is $15,000 and interest rates are set at 3%. The loan term is determined by the use of funds.
Community & Economic Development Associates (CEDA) administers Microenterprise Fund Loans that provide financing to start-up, newly established and growing businesses. Applicants must be able to demonstrate a need for financing through a realistic business plan, and must be unable to obtain financing from a traditional lender.
Eligible Loan Uses
- Seed Capital
- Working Capital
- Expansion Capital
- Inventory and Equipment
- Real Estate
- Building Renovations
Loans up to $60,000 may be administered with a negotiable interest rate not to exceed 6%. Loan terms are a maximum of six years.
The Minnesota Reservist and Veteran Business Loan Program provides business loans to companies that are affected when certain employees are called to active military duty and to individual veterans who have returned from active duty and want to start their own business.
Business Loan Eligibility
- Be a for-profit business which is not an affiliate or subsidiary of a business dominant in its field of operations
- Have 20 or fewer full-time employees
- Have had less than $1 million in annual gross revenue in the preceding fiscal year (or less than $2.5 million in annual gross revenue if the business is a technical or professional service)
- Operating in Minnesota on the date that one or more essential employees received orders for active service of 180 days or more and be likely to sustain suffering substantial economic injury
Startup Business Loan Eligibility
- Be majority-owned and operated by a veteran recently separated from active duty
- Be a for-profit business that is not an affiliate or subsidiary of a business dominant in its field of operations
- Have 20 or fewer full-time employees
- Have had less than $1 million in annual gross revenue in the preceding fiscal year (or less than $2.5 million in annual gross revenue if the business is a technical or professional service)
Both types of loans provide one-time, interest-free loans of $5,000 to $20,000. The loan terms are 54 months, with no repayment for the first 18 months and equal monthly payments over the remaining 36 months.
The Minnesota Native American Business Loan Program supports the development of Native-owned and operated businesses and promotes economic opportunities for Native peoples throughout Minnesota. Loan applicants must be enrolled members of a federally recognized Minnesota-based band or tribe. Businesses must be wholly owned by an enrolled member and can be located anywhere in the state.
Loan proceeds may cover startup and expansion costs, including normal expenses such as machinery and equipment, inventory and receivables, working capital, new construction, renovation and site acquisition.
Interest rates may be between 2% and 10%, with real estate loan term limits of no more than 20 years and non-real estate loan term limits of no more than 10 years. Loans may not exceed 75% of the project’s costs. Owners must provide a portion of the financing needed to undertake the project, between 5% and 10%.
In partnership with the Minnesota Department of Employment and Economic Development (DEED), the Metropolitan Consortium of Community Developers (MCCD) provides flexible, low-interest capital for startup, conversion and growth financing for Minnesota businesses that are at least 51% owned by people who are Black, Indigenous, People of Color, immigrants, low-income, women, people with disabilities, or those serving underinvested geographic areas.
Loan amount range from $50,000 to $300,000 with a 4% interest rate.