The state of Minnesota is offering emergency loans of up to $35,000 to businesses struggling to survive the shutdown brought on by the spread of the novel coronavirus.
The interest-free loans will be 50% forgivable under certain conditions and available through 22 lenders across the state.
Gov. Tim Walz, by executive order, made $30 million available for the program, which could end up helping as many as 5,000 businesses.
Steve Grove, commissioner of the Minnesota Department of Employment and Economic Development (DEED), said Tuesday that close to 150,000 Minnesotans had filed for unemployment benefits since March 16. One goal of the loan program is to help small businesses keep workers employed, at least in some capacity.
"If employers can find ways not to fully lay workers off, it's going to make the recovery process that much better," Grove said.
Minnesota is one of several states establishing emergency-loan programs for small businesses.
The Small Business Administration is taking applications for disaster loans of up to $2 million, but that process takes time, and Minnesota firms may need a "bridge loan" to help them survive until federal assistance arrives, Grove said.
"It's clear that the federal government is going to have stronger and better levers to help small businesses weather this time than states will," Grove said. "But we want to do what we can for Minnesota businesses, too."
Massachusetts started an emergency-loan program with $10 million and allowed businesses to borrow up to $75,000. The money was gone in three days, Grove said.
Minnesota is trying to help a broader array of businesses.
"We know demand will be high," Grove said.
Minnesota small businesses should send questions about this emergency loan program to ELP@state.mn.us.