Deal reached on Minnesota business relief bill; some money will go to riot-damaged businesses

Minnesota lawmakers have agreed to $150 million in business relief, though only a fraction of the money will go to businesses damaged by the 2020 civil unrest in Minneapolis and St. Paul.

Of the total amount in the jobs and economic development bill, $80 million will be available for redevelopment projects, which could be used for rebuilding after the rioting. The other $70 million will cover business losses related to the COVID-19 pandemic.

It's not clear how much money will flow to riot rebuilding, though it will be far less than the $300 million that Democrats originally proposed in the wake of the unrest. Since then, some businesses have rebuilt with insurance money or private foundation funds. Government has not provided rebuilding money.

"We’re disappointed we didn’t get direct funding for Minneapolis and St. Paul," state Rep. Mohamud Noor, DFL-Minneapolis and the House's lead negotiators, said in an interview. "This is a starting point. The fight for the redevelopment of those corridors -- it’s just the beginning."

The issue has been one of the toughest to solve during state budget negotiations. Many Democrats represent Minneapolis and St. Paul districts where business owners have been pleading for relief, but Republicans have long criticized riot relief as a "bailout" to the cities.

Riot-damaged businesses could get up to $750,000 in grants for their projects and a $2 million loan guarantee, provided they meet several conditions. The state aid would be capped at 30 percent of a project's overall cost. Grants will be made in three application rounds from 2021-2023.

The $70 million for COVID relief will be doled out in a lottery program from the state Economic Development agency. Smaller businesses could get up to $10,000 and larger businesses would get a maximum of $25,000.

Half of the funding will be for Metro businesses and the other half for outstate businesses. The state will give priority to businesses that didn't receive any funding from two previous rounds of relief that totaled $275 million.

"The program is built on the lessons we learned from the first two grant programs we did," said state Sen. Eric Pratt, R-Prior Lake, the Senate's lead negotiator.

Youth unemployment, fire suppression

The jobs and economic development bill makes youth workers eligible for unemployment benefits starting in July 2022.

The bill also requires public housing authorities to retrofit high-rise buildings with automatic sprinkler systems by 2033. It follows a deadly Thanksgiving 2019 fire in a Cedar-Riverside apartment tower.

Slow-moving debate

The legislation will head to the Senate floor as soon as Friday morning. It will join a logjam in the House, where Republicans spent Thursday filibustering another budget bill after they said they had been shut out of negotiations.

That is pushing the divided Legislature closer to the brink of July 1 government shutdown if a budget doesn't pass. Top lawmakers and Gov. Tim Walz have guaranteed that they will avoid a shutdown.