Serving the citizens of Koochiching County and the cities of Bigfalls, International Falls, Littlefork, Northome, Ranier and surrounding region.
Serving the citizens of Koochiching County and the cities of Bigfalls, International Falls, Littlefork, Northome, Ranier and surrounding region.

Funding Sources

Local Resources

Lending Institutions
City of International Falls Commercial Loan Program
Koochco Loan Program
Koochiching Community Development Association
Littlefork Commercial Loan Program
City of Big Falls Commercial Revolving Fund
City of Northome Commercial Revolving Fund

Border State Bank
1414 Highway 71
International Falls, MN 56649
218-283-5556
www.borderstatebank.com

Bremer Bank
345 Fourth Avenue
International Falls, MN 56649
218-283-9411
www.bremer.com

First National Bank of Deerwood
Northome Branch
P.O. Box 6/12080 Main Street
Northome, MN 56661
218-897-5285
www.deerwoodbank.com

TruStar Federal Credit Union
International Falls Branch
601 Fourth Street
International Falls, MN 56649
218-283-2000
www.trustarfcu.com

Littlefork Branch
201 Main Street
Littlefork, MN 56653
218-278-4200

Wells Fargo
419 Third Street
International Falls, MN 56649
218-283-9876
www.wellsfargo.com

Program Guidelines/Eligibility Requirements:

  • Improvements to commercial property
  • Business must be located in corporate city limits
  • Up to $24,999.99
  • 3% interest; monthly payment equals about $108 on a loan of $24,999.99
  • Collateral shall be a mortgage on the real estate to be improved by proceeds of the loan
  • Closing costs paid by borrowers
  • Program requires loan of equal or greater value from a local participating bank
  • Loan is amortized over 30 years with a balloon payment due in 7 years or if property is sold
  • Loan documents prepared by your bank which services both loans

Contact:
City of International Falls
600 4th Street
International Falls, MN 56649
(218) 283-9484

Program Guidelines/Eligibility Requirements:

Businesses must be located within Koochiching County. All Koochco loans will be term loans. Maximum amortization will be 20 years and active participation will be limited to 5 years in most cases. The policy will require a balloon payment or call provision after the fifth year of the loan.

The Koochco loan will be no more than 50% of the project financing with a maximum loan amount of $40,000; the remainder to be financed by a private lending institution. Interest rate on the Koochco portion will be 1% less than bank rates and follow bank rate structure.

Collateral coverage must satisfy both Koochco and the bank; personal guarantees are required. Demonstrated credit worthiness and commitment of the applicant is required; management experience or other qualifications will be reviewed, as well as marketing plans. Projects that are entirely or primarily a refinancing of existing debt will not be allowed unless such refinancing will result in a significant upgrading or expansion of operations and creation of jobs.

Eligible Businesses

  • Resort/tourism projects which attract expenditures from outside the region
  • Manufacturing and industrial operations
  • Service, office sector, health care, cold weather testing
  • Retail businesses will be considered case by case
  • Wood products
  • Agriculture
  • Special consideration is also given to businesses locally started and funded, demonstrating renovation and growth potential
  • The applicant may be for-profit or non-profit and may be new or expansion of an existing business.

Eligible Uses of Loan Funds

  • Land and building acquisition and improvements
  • New building construction and building renovation
  • Purchase of machinery and equipment
  • Resort expansion of facilities or upgrading of accommodations
  • Working capital (not a revolving line of credit)
  • Inventory purchase
  • Reasonable accounting, legal, architectural, engineering and appraisal fees

Click here to download the Koochco Loan Application

Contact:
Koochco, Inc.
405 3rd Street
International Falls, MN 56649
(218) 283-2799

Program Guidelines/Eligibility Requirements:

To be eligible for this program, the project or entity must be located, intended to be located, or provide services within Koochiching County.

The entity seeking assistance may be for-profit, non-profit, or a Governmental entity and may be new or an expansion of an existing business.

Terms of the funding will be at the discretion of the Association and will not exceed $5,000 per project. The Association will accept applications and distribute funding on a quarterly basis.

KCDA Business Application download

KCDA Community Enhancement Application download

Contact:
Koochiching Community Development Association
Kyra Briggs, Secretary/Treasurer
PO Box 138
405 3rd Street
International Falls, MN 56649
(218) 283-8585

Program Guidelines/Eligibility Requirements:

  • Business must be located in corporate city limits, however, amendments can be considered by the City Council to assist business outside the City
  • Minimum loan $5,000 up to a maximum of $50,000
  • Minimum rate of 6% interest
  • Collateral satisfactory to the City and lending institution
  • Program requires loan bank participation and owners investment of equity
  • Loan documents prepared by your bank which services both loans

Eligible Uses of Proceeds:

  1. Land and building acquisition
  2. Land Improvements
  3. New building construction
  4. Building renovation
  5. Purchase machinery/equipment
  6. Working capital (not a revolving line of credit)
  7. Inventory purchase
  8. Limited refinancing:
    1. Associated with job expansion
    2. Results in new job creation
    3. Improved collateral position of the City

Eligible Businesses:

  1. Tourism projects which attract tourism from outside the area
  2. Energy related businesses that utilize indigenous fuels
  3. Technologically innovative industries
  4. Manufacturing/industrial operations/services/supply
  5. Forest/wood products
  6. Agriculture
  7. Professional offices

Ineligible Businesses:

  1. Retail/Service – however there may be exceptions
  2. Construction
  3. Media
  4. Transportation
  5. Speculative Real Estate

Contact:
City of Littlefork
901 Main Street
Littlefork, MN 56653
(218) 278-6710

Goals and Objectives:

  • The RLF will be used to assist businesses that will create or maintain jobs and alleviate economic distress or address other community development needs.
  • To provide debt financing to projects that otherwise may not occur due to a gap in funds available from owner and conventional sources.
  • To stimulate development for the purpose of job creation or retention, tax base enhancement and development which enhances the economic base for the area.
  • The revolving loan fund supports job opportunities to alleviate unemployment and underemployment.

Standard for the RLF Projects:

The RLF portfolio taken as a whole will meet the following standards. At times individual loans may vary from these standards due to highly unusual circumstances or overriding factors which may make deviation a necessity. The following are the minimum standards for the RLF portfolio:

  • The RLF will provide no more than 75% of the total project cost.
  • Collateral shall be in the form of a mortgage or title lien, with the City of Big Falls listed as 1st Secured party.
  • The maximum loan will be for $25,000
  • Eligible uses are for new businesses or existing business expansion. Uses include land, equipment and building acquisition and construction or remodeling.
  • Ineligible fund uses are working capital and refinancing of existing debt.
  • All accounts owing to the City of Big Falls must be current, including taxes, special assessments, utilities and other loan programs.
  • Local contractors shall be used whenever possible.
  • The maximum term of the loan shall not exceed 7 years.
  • The interest rate shall be tied to a prime or fixed rate as determined by the Revolving Loan Committee at the time of the loan closing.
  • The applicant shall be responsible for all “Hard Costs” of the loan process. These costs may include but are not limited to attorney’s fees, appraisal fees or other costs incurred during the application.

Contact:
City Office PO Box 196
Big Falls, MN 56627 Hours: Mon. – Thurs. 8 a.m. to 4 p.m.
(218) 276-3300
bigfalls@paulbunyan.net

Program Guidelines/Eligibility Requirements:

  • Business must be located in corporate city limits
  • Up to a maximum of $6,000 with a required equal matching contribution from the applicant and repayments to be made on the basis of one year repayment for each $1,000 loaned.
  • Available to finance legitimate business activity, new or existing, or to individuals for improvements to housing. Activities not eligible include personal vehicle purchase or lease, purchase of personal items, travel, training, or inventory expenses.
  • Loan rate is 1.5%.
  • Loans must be secured.

Contact:
City of Northome
P.O. Box 65
12060 Main Street
Northome, MN 56661
(218)897-5762 or (800)862-6521

Regional Resources

Arrowhead Regional Development Commission (ARDC) Revolving Loan Fund
Minnesota Business Finance Corporation (MFBC)
Entrepreneur Fund Business Financing
Northland Foundation Business Loans

Purpose:

The purpose of the ARDC/RLF is to support business activities for which credit is not otherwise available on terms and conditions that would permit completion and/or the successful operation or accomplishment of the project in the seven county region of Northeast Minnesota.

The primary objective of the program is the stimulation of private investment in order to create and maintain productive, permanent employment through the establishment of new businesses or the expansion of existing businesses.

Financing provided in conjunction with this program is intended to compliment, not compete with private lending institutions. As such, securing private sector involvement is a critical factor in qualifying for this program. Loans will generally be subordinated to the interests of private sector lenders in order to encourage their involvement.

Other Financing Policies:

  • Loan recipient must be a for profit business.
  • All loans must be adequately secured & personally guaranteed.
  • All loans shall be subject to whatever agreements/documents are reasonably necessary to protect the interests of ARDC.
  • Loan recipients must demonstrate that they are credit worthy.
  • All recipients must demonstrate an acceptable level of job creation/retention and private sector investment.
  • All loans shall be subject to the provisions of the Davis Beacon Act with respect to prevailing wage rates.
    Applicants for RLF financing must demonstrate that credit is not otherwise available on terms and conditions which would permit completion and/or the successful operation or accomplishment of the project activities to be financed.

Eligible Businesses/Priority economic sectors that are eligible for assistance through this program include:

  • Aviation/Aerospace
  • Manufacturing
  • Renewable Resources
  • Technology
  • Energy
  • Other

Leveraging Requirements:

  • Jobs
    • Applicants must demonstrate that they will create or retain a minimum of one job per $10,000 in ARDC/RLF assistance.
  • Private Sector Investment
    • Applicants must demonstrate that they will leverage a minimum ratio of two private sector dollars to one ARDC/RLF dollar (2 to 1).
    • Applicants must also demonstrate the minimum leveraging ratio, exclusive of owner’s equity investment is one private sector dollar to one ARDC/RLF dollar (1 to 1).

Financing Policies:

  • Allowable Use of Proceeds
    • Minimum loan size -$10,000
    • Maximum loan size- $250,000
    • Fixed assets, including land and building purchases, building construction, leasehold improvements, and renovations (twenty year term max); and/or
    • Acquisition, renovation or moving machinery and equipment (ten year term max); and/orWorking capital (term loans only, five year max)
  • Term of Loan – The length of any loan made by the ARDC/RLF will be based on the assets being financed.
  • Interest Rate – Interest rates will be based on the current money center bank prime rate as quoted in the Wall Street Journal, minus four (4) percentage points, rounded up to the nearest 1/4 percentage point. Minimum interest rate of four (4) percent.

Fees and Charges:

  • Origination Fee – A 1½ percent loan origination fee will be charged to all borrowers participating in the ARDC/RLF. Such fee is to be paid only for approved loans, but must be paid at or prior to closing with the applicant’s own resources.
  • Loan Servicing Fee – 1% per year, based on outstanding principle balance.
  • Legal Costs – Borrowers are responsible for legal costs incurred by the ARDC/RLF in the closing of the borrower’s particular loan.

Contact:
Bob Palmquist
The Northspan Group, Inc.
221 West First Street
Duluth, MN 55802
(218) 529-7562
bpalmquist@northspan.org

Program Guidelines/Eligibility Requirements:

Minnesota Business Finance Corporation (MBFC) is a private not-for-profit, company that is authorized by the U.S. Small Business Administration to originate and service SBA 504 loans.

The SBA 504 loan program provides fixed asset financing for businesses. Projects can include new construction, acquisition, renovation and remodeling of buildings, as well as equipment acquisition. MBFC partners with commercial lenders to provide secondary financing of 30 to 40% of a project with the bank providing 50% of the project and the borrower having an equity contribution of 10 to 20%. The bank’s loans have a senior position on collateral with MBFC taking a second mortgage or lien on the assets financed.

The SBA 504 loan provides a fixed interest rate for the term of the loan (up to 20 years). The terms of the bank’s loan are negotiated with the borrower and the bank. With the 504 loan program the bank loan is separate from the SBA 504 loan.

Contact for Koochiching County:
Chuck Nordquist
Bemidji, MN
(218) 759-8481
Contact for St. Louis County:
Terry Stein
616 Roosevelt Road, Suite 200
St. Cloud, MN 56301
(320) 258-5009

Through flexible loan programs, NEF helps aspiring entrepreneurs launch start-up businesses and experienced entrepreneurs do turnarounds and capitalize on emerging opportunities.

Financing is available from $1,000 to $35,000 for start-up businesses, and up to $150,000 for established businesses.

Working side-by-side with you, NEF has created lending products and an easy process to give you upfront access to small business financing and on-going support to ensure success.

NEF knows that building a business takes more than money; it takes a lot of hard work. So when NEF makes a loan, they make a mutual commitment to your on-going success.

  • The Entrepreneur Fund, with its $7.5 million capital pool, can be the sole lender, or it can partner with banks and economic development organizations to provide financing.

Contact:
Virginia Office
8355 Unity Drive
Suite 100
Virginia, MN 55792
(218)749-4191
Duluth Office
202 W. Superior Street
Suite 311
Duluth, MN 55802
(218) 623-5747

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Program Guidelines/Eligibility Requirements:

The Northland Foundation provides flexible, reasonably priced financing to eligible businesses, mostly in conjunction with other lenders. The main goals of the program are to stimulate private sector investments and create and retain jobs, which enhance the Arrowhead Region’s ability to grow and prosper.

There are two types of Business Loans. The first is a direct loan in which the Northland Foundation is the originator of the note. The second is a participation loan in which the Northland Foundation purchases a part of a loan from another lender.

  • Business loans generally range from $50,000 to $500,000.
  • Interest rates are negotiated fixed or floating rates, generally equal to or less than the rates charged by commercial banks.
  • Loan term and amortization are based on the assets financed, collateral securing the loan, and needs of the business. Amortizations will generally not exceed 15 years. Loan maturities for longer-term amortizations will generally include balloon payments.
  • Loans may be subordinated to the interests of institutional lenders to encourage their involvement.

Contact:
John Elden
202 West Superior Street, Suite 610
Duluth, Minnesota 55802
(800) 433-4045

State Resources

MN Department of Employment and Economic Development (DEED)

Contact:
Heather Rand
NE MN Regional Economic Developer
218-723-4610 or 888-345-4528

Greater Minnesota Job Expansion Program
Innovation Voucher Pilot Program
Job Training Incentive Pilot Program
Minnesota Investment Fund (MIF)
State Small Business Credit Initiative
STEP Grant Program

Under this program, businesses in Greater Minnesota (outside the seven-county Twin Cities area) will receive sales tax refunds on all purchases made during a seven-year period.

To qualify for the refund, a participating business must have operated in Greater Minnesota for at least one year and must commit to expanding its workforce at a single facility. The business must increase full-time employment at the facility by two employees or 10 percent of current employment, whichever is greater, within three years.

DEED will determine the size of the sales tax refund that each business will receive (up to $2 million annually and $10 million over seven years), based in part on employment and capital investments. DEED will certify businesses to participate in the program and monitor them to ensure that they achieve hiring and wage commitments. The sales taxes will be refunded once DEED determines performance goals have been met.

Public utilities or businesses engaged in retail sales, lobbying, gambling, entertainment, professional sports, political consulting, leisure, hospitality or professional services are not eligible to participate.

Application materials and other details about the program are available here on the DEED website.

This pilot program provides up to $25,000 to help small businesses pay for technical assistance and services from public higher education institutions and nonprofit entities.

Qualifying companies will receive vouchers, which can be redeemed for technical assistance and services that include research, technical development, product development, commercialization, market development, technology exploration and improved business practices.

Companies with 40 or fewer employees, with at least half of the employees based in Minnesota, may apply. Recipients must provide a cash match equal to 50 percent of the voucher award.

DEED will provide funding for the face value of each voucher once a business receives technical assistance and services and documents a deliverable outcome.

Application materials and other details about the program are available here on the DEED website.

The program, an outgrowth of DEED’s Minnesota Job Skills Partnership, provides grants of up to $50,000 to new or expanding Minnesota businesses that need to train new workers as quickly and efficiently as possible. The program is available to businesses that have fewer than 150 full-time employees and are increasing their Minnesota workforce by at least 10 percent, with a minimum of five new jobs.

Priority will be given to businesses in the manufacturing, skilled production and information technology industries and firms located in Greater Minnesota. Businesses may use a variety of training providers or use in-house trainers.

Workers can be trained in basic skills, advanced technical skills, specific industry equipment, processes, safety, worker-related language, soft skills and other areas identified by the employer.

Recipients must provide a cash match equal to 50 percent, 75 percent or 100 percent of the amount awarded by DEED, depending on the size of the business.

Application materials and other details about the program are available here on the DEED website.

DEED is the state’s principal economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development. For more details about the agency and our services, visit us at http://mn.gov/deed/ . Follow us on Twitter at twitter.com/mndeed.

Program Guidelines/Eligibility Requirements:

Eligibility: Funds are awarded to local units of government who provide loans to assist expanding businesses. Cities, counties, townships and recognized Indian tribal governments are eligible for this fund.

Project Requirements: All projects must meet minimum criteria for private investment, number of jobs created or retained, and wages paid. There is a maximum of $500,000 per loan. Only one loan per state fiscal year may be awarded to a government unit.

At least 50 percent of total project costs must be privately financed through owner equity and other lending sources (most applications selected for funding have at least 70 percent private financing).

Terms and Interest: Loan terms are for a maximum of 20 years for real estate and a maximum of 10 years for machinery and equipment. Interest rates are negotiated.

MIF loans are 20% forgivable.

Contact:
Office of JOBZ and Business Finance
(651) 259-7430 or (800) 657-3858

Job Creation Fund

Overview:
The Job Creation Fund provides financial incentives to new and expanding businesses that meet certain job creation and capital investment targets.

Companies deemed eligible to participate may receive up to $1 million for creating or retaining high-paying jobs and for constructing or renovating facilities or making other property improvements. In some cases, companies may receive awards of up to $2 million.

Eligibility and Requirements:
The program is available to businesses engaged in manufacturing, warehousing, distribution, technology-related industries, and other eligible activities. Companies must work with the local government (city, county or township) where a project is located to apply to DEED to receive designation as a Job Creation Fund business.

To be designated as a Job Creation Fund business, a business must, at minimum:

  • Be engaged in an eligible business activity
  • Obtain local government support for their project via council resolution
  • Invest at least $500,000 in real property improvements within one year of becoming a designated Job Creation Fund business
  • Create at least 10 new full-time permanent jobs within two years of becoming a Job Creation Fund business while maintaining existing employment numbers
  • Pay at least $12.45 in wages and benefits adjusted annually based on 110 percent of federal poverty guidelines
  • Have other location options outside of Minnesota
  • Cause no undue harm to Minnesota business competitors
  • Certify that the project would not occur without Job Creation Fund assistance

Projects that begin prior to becoming designated by DEED are not eligible for the Job Creation Fund.

Available Benefits:
Companies that meet eligibility requirements must sign a business subsidy agreement with DEED to meet job retention, creation, wage, and capital investment requirements. The following benefits may be available once a business meets the conditions of its agreement and provides proof of performance:

  • $1000 per year per job created for jobs paying at least $26,000 in cash wages
  • $2000 per year per job created for jobs paying at least $35,000 in cash wages
  • $3000 per year per job created for jobs paying at least $45,000 in cash wages
  • Up to a 5 percent rebate for real property improvements for businesses located in the Twin Cities Metro
  • Up to a 7.5 percent rebate for real property improvements for business located in Greater Minnesota

Contact:
Emily Johnson
651-259-7450 / toll free at 800-657-3858

Capital Access

The Capital Access Program encourages banks, credit unions, and community development finance institutions operating in Minnesota to make loans that fall just outside the lenders’ normal underwriting standards.

The program provides portfolio insurance based on a separate loan loss reserve account funded by the borrower, lender, and the state. The loans enrolled may be for industrial, commercial, or agricultural purposes. Loans for lines of credit are also accepted.

Eligible Applicants:
For-profit Minnesota businesses that have up to 500 employees company-wide.

Eligible Projects:
CAP funds may be used for start-up costs, working capital, business acquisitions and expansions, franchise financing, equipment loans, inventory financing, construction, and commercial, non-passive real estate acquisitions. Projects that include passive real estate are only allowed on a limited basis as determined by U.S. Department of the Treasury guidelines. Financing of existing debt is not permitted.

Maximum Available:
The maximum loan amount that may be enrolled is $5 million.

Other Funds Required:
Lender and borrower contribute, in equal parts, a combined 3-percent to 7-percent of the loan amount to the reserve fund. The Minnesota Department of Employment and Economic Development (DEED) matches the combined contribution amount.

Interest Rates and Terms:
Each qualified program lender has authority to determine interest rates, terms, and collateral requirements.

Application Process:
Participating lenders accept applications on a rolling basis. Lenders use their own underwriting standards and loan processes. DEED provides its contribution when a lender submits a loan enrollment form and notifies the state that it has approved a loan and deposited funds into its reserve account.

Participating Lender in NE Minnesota:
Northland Foundation
Mr. John Elden
202 West Superior Street, Suite 610
Duluth, MN 55802
800.433.4045 phone
www.northlandfdn.org

For More Information:
Bart Bevins, Capital Access Program
651-259-7424 or 800-657-3858
E-mail: Bart.Bevins@state.mn.us

Emerging Entrepreneurs

The Emerging Entrepreneurs Fund primarily supports micro-enterprises and small businesses with fewer than 50 employees, targeting minority- and women-owned businesses and those located in economically distressed areas.

Eligible Applicants:
Businesses with fewer than 500 employees company-wide are eligible. However, the funding is focused on micro-enterprises and businesses with fewer than 50 employees.
The majority of the businesses receiving financial support through this program will be owned and operated by a woman or a minority or will be located in areas identified by DEED as distressed. Distressed areas are measured by population loss, higher than statewide average unemployment rate, and lower than statewide median household income.

Eligible Projects:
EEF funds may be used for start-up costs, working capital, business procurement, franchise fees, equipment, inventory, as well as the purchase, construction renovation, or tenant improvements of an eligible place of business that is not for passive real estate investment. Projects that include passive real estate are only allowed on a limited basis as determined by U.S. Department of the Treasury guidelines. Financing of existing debt is not permitted.

Maximum Available:
EEF funds may total up to $150,000 per loan and must be matched on at least a one-to-one basis. Participating lenders are encouraged to structure loan proposals to achieve at least a 5:1 leverage of program funds.

Interest Rates and Terms:
Each qualified program lender has authority to determine interest rates and collateral requirements within program guidelines.

Application Process:
Qualified lenders accept applications on a rolling basis. Application forms and procedures vary by lender. Businesses should apply with participating lenders. DEED is notified of all loans approved to ensure that all program guidelines are followed.

Participating Lender in NE MN
Northeast Entrepreneur Fund, Inc.
8355 Unity Drive, Suite 100
Virginia, MN55792
(218) 749-4191 or (800) 422-0374

For more information:
Bart Bevins
(651)259-7424 or (800)657-3858
Bart.Bevins@state.mn.us

Loan Guarantee Program

The Small Business Loan Guarantee (SBLG) Program guarantees up to 70 percent of a loan made by non-traditional lenders like CDC’s, CDFI’s, and other nonprofit lenders. Banks and credit unions will benefit by a reduction in overall financing risk.

Eligible Applicants:
Loans must be made to businesses with no more than 500 employees company-wide.

Eligible Projects:
Funds may be used for construction; remodeling or renovation; leasehold improvements; purchase of land, buildings, machinery and equipment; maintenance or repair; expenses related to moving into or within Minnesota; and working capital (if secured by fixed assets). Projects that include passive real estate are only allowed on a limited basis as determined by U.S. Department of the Treasury guidelines.

Maximums Available:
The entire finance package, including non-SSBCI funds, may not exceed $20 million. The program guarantees up to 70 percent of the loan.

Other Funds Required:
Lenders must demonstrate that a bank or commercial lender will match the guaranteed loan amount. Loans from this fund may not be used to guarantee the un-guaranteed portion of SBA loans. Lenders participating in the loan guarantee programs pay a fee of 0.25 percent of loan principal into a reserve fund.

Interest Rates and Terms:
Interest rates and terms are negotiated between borrower and lender. Loans generally require a debt coverage ratio of at least 1.25 and a current ratio of 1.2.

Application Process:
Program-approved lenders submit loan enrollment applications to the Minnesota Department of Employment and Economic Development on a rolling basis.

Participating Lenders for NE Minnesota:
Northland Foundation
John Elden
610 Sellwood Building
202 West Superior Street
Duluth, MN 55802
(218) 723-4040 or (800)433-4045

For more Information:
Lisa Dargis
Small Business Loan Guarantees
(651) 259-7446 or (800) 657-3858
Lisa.dargis@state.mn.us

Angel Loan Fund

Minnesota’s Angel Loan Fund Program (ALF) provides a new funding option for businesses certified to participate in Minnesota’s Angel Tax Credit Program.

The program provides a direct loan for 10 percent of the total amount of equity investment received in the business’ approved funding round. Only one loan may be issued to each business for the duration of the ALF. At least one equity investment must be made by an investor that is both certified by the MN Angel Tax Credit Program and qualified as an Accredited Investor per the U.S. Securities and Exchange Commission under Rule 501 of Regulation D. However, the total equity investment attained for the round is not exclusive to investments made to meet the requirements of the Angel Tax Credit Program.

Eligible Applicants:
Businesses certified to participate in the Angel Tax Credit Program during any of the program years with fewer than 500 employees.

Eligible Use of Funds:
Funds may be used for start-up costs, working capital, business acquisitions and expansions, franchise financing, equipment loans, inventory financing, construction, and commercial, non-passive real estate acquisitions.

Maximum Available:
10 percent of equity raised after program enrollment; $20,000 minimum loan amount, $250,000 maximum.

Interest Rates and Terms:
Zero-percent interest, seven-year term, non-recourse, deferred, with a balloon. If the business is sold during the term, business will submit risk mitigation fee compensation equal to 30 percent of the original loan principal.

Application Process:

  1. Business obtains Minnesota Angel Tax Credit Program Certification during any of the program years.
  2. Business submits the ALF Business Enrollment Application Form and required supporting documents to DEED.
  3. Business receives ALF Acceptance Letter from DEED outlining maximum loan amount and eligible funding round beginning and end dates.
  4. Business submits the ALF Proof of Investment and Loan Request Form and supporting documents, once maximum investment has been raised during the eligible funding round.
  5. Business submits signed ALF Loan Agreement, ALF Promissory Note, and ALF Sales Proceeds Agreement.
  6. DEED distributes loan proceeds.

While $6.7 million has been allocated to the ALF, loans in excess of the currently available $3.5 million will require receipt of an additional tranche of SSBCI funding from the U.S. Department of the Treasury. There may be a delay in ALF loan disbursements while funds are being requested. Although DEED expects funds to be available, there is no guarantee of funds if DEED does not obtain funding from the U.S. Department of the Treasury, or if funding cannot be continued at a level adequate to allow payment all the total allocation.

For More Information:
Lisa Dargis
Angel Loan Fund
651-259-7446 or 800-657-3858
Email: Lisa.dargis@state.mn.us

The STEP program provides financial and technical assistance to qualifying Minnesota small businesses with an active interest in exporting products or services to foreign markets.

Participants may be first-time exporters or companies that are currently exporting but are interested in expanding into new international markets.

Financial Assistance Available
Small businesses may apply for reimbursement of up to $500 for export-training that will result in the development of an export strategy or up to $7,500 for approved export-development activities, including:

  • Participation in trade missions
  • Exhibiting at trade shows or industry-specific events
  • Translation of marketing materials
  • Development of foreign language websites
  • Gold Key or other business matchmaking services
  • Company-specific international sales activities
  • Testing and certification (such as CE marking) required to sell products in foreign markets
  • Minnesota participating businesses must partner with an accredited Minnesota educational institution. Grants of up to $400,000 are awarded to the educational institution to develop and deliver training specific to the business needs. A cash or in-kind contribution from the participating business must match grant funds on at least a one-to-one basis.
  • A short-form application is available for grants of up to $50,000.
  • Projects average one to three years in duration.
  • Use of Funds

Funds may be used for training-related costs such as curriculum development, instruction, training materials and supplies, training equipment, and instructor travel. Requests for wage subsidies and tuition reimbursements are NOT eligible. However, wages paid to employees during training may be counted towards the required matching contribution.

Minnesota jobs Skills Partnership (MJSP) Grants

To meet Minnesota employers skilled workforce needs, grants of up to $400,000 are available for customized employee training programs via the Minnesota Jobs Skill Partnership (MJSP) grant program. MJSP grants are awarded to an accredited higher education institution to cover the costs of developing and delivering customized training to employees. The employer must provide matching funds (which may be in-kind value). The value of an employee’s wages while training often serves as the employer’s match.

Minnesota participating businesses must partner with an accredited Minnesota educational institution. Grants of up to $400,000 are awarded to the educational institution to develop and deliver training specific to the business needs. A cash or in-kind contribution from the participating business must match grant funds on at least a one-to-one basis.

A short-form application is available for grants of up to $50,000.

Projects average one to three years in duration.

Use of Funds
Funds may be used for training-related costs such as curriculum development, instruction, training materials and supplies, training equipment, and instructor travel. Requests for wage subsidies and tuition reimbursements are NOT eligible. However, wages paid to employees during training may be counted towards the required matching contribution.