Flood Recovery Financing

Overview

Flood-recovery funds allocated through the Minnesota Investment Fund are awarded to local units of government, which use the funding to make loans to individual businesses.

Unlike insurance, MIF flood-recovery funding is not designed to make businesses “whole” or compensate them for losses. The focus of the program is to fund capital expenses, reestablish operations, and retain and create jobs at flood-damaged businesses that were not adequately covered by insurance.

2012 Northeast Flooding

The Minnesota Investment Fund has $15 million in disaster-recovery funding for flood-affected communities.

Local government units (counties, cities, etc.) apply for the funding and then provide loans to businesses that were directly and adversely affected by the storms and flooding that occurred June 14 through June 21, 2012.

Eligibility
Businesses, cooperatives, utilities and nonprofits are eligible if they were in operation prior to June 14, 2012 and are located in one of 15 counties or tribal lands included in the presidential disaster declaration DR-4069.

Counties and tribal lands included in the declaration are: Aitkin, Carlton, Cass, Cook, Crow Wing, Dakota, Goodhue, Itasca, Kandiyohi, Lake, Meeker, Pine, Rice, Sibley, St. Louis and the Fond du Lac Band of Lake Superior Chippewa, Grand Portage Band of Lake Superior Chippewa and the Mille Lacs Band of Ojibwe.

Eligible expenses include repair of buildings, leasehold improvements, fixtures and equipment, loss of inventory and cleanup costs. Non-eligible expenses include economic injury, business relocation costs, other non-capital losses, and refinancing of debt existing prior to June 14, 2012. However, the U.S. Small Business Administration may provide financing for such losses.

Application Process

Step One - Review this Minnesota Investment Fund Disaster Recovery Financing document, which outlines the general framework that will be used by DEED to award funding.

Step Two - Local governments (typically counties) use these Sample Guidelines to develop their own local guidelines and criteria for evaluating loan applications and administering the program.

Step Three - Once the local guidelines have been approved by local officials, the local government should forward the document to DEED along with this completed MIF Disaster Recovery Application, which outlines the expected business financing needed for recovery. Once DEED reviews the MIF application and the guidelines have been reviewed by the legislature, grants agreements between DEED and the local government will be completed.

Step Four - Following DEED’s approval of the MIF Disaster Recovery Application and the completion of the grant agreement, local governments may develop loan agreements with business recipients. To ease administration, DEED recommends that local governments use this DEED Business Loan Application. DEED will disburse funds for each recipient as expenditure information is received.

For More Information
Contact Bob Isaacson at 651-259-7458 or email bob.isaacson@state.mn.us.

2010 Southern Minnesota Flooding

The Minnesota Investment Fund has $10 million in flood-recovery funding to provide loans to businesses directly and adversely affected by flooding on September 22-23, 2010.

Eligibility
Businesses, cooperatives, utilities and nonprofits are eligible if they were in operation prior to September 22, 2010 and are located in one of 29 counties included in the federal disaster declaration.

They include: Blue Earth, Brown, Carver, Cottonwood, Dodge, Faribault, Freeborn, Goodhue, Jackson, Le Sueur, Lincoln, Lyon, Martin, Mower, Murray, Nicollet, Nobles, Olmsted, Pipestone, Redwood, Rice, Rock, Sibley, Steele, Wabasha, Waseca, Watonwan, Winona, and Yellow Medicine counties.

Eligible expenses include repair of buildings, leasehold improvements, fixtures and equipment, loss of inventory and cleanup costs.

Non-eligible expenses include economic injury, business relocation costs, other non-capital losses, and refinancing of debt existing prior to September 22, 2010. However, the U.S. Small Business Administration may provide financing for such losses.

Application Process
The first step is to review the Minnesota Investment Fund Disaster Recovery Financing document, which outlines the step-by-step process that will be used by DEED to award funding.

Local governments (typically counties) develop their own guidelines and criteria for evaluating loan applications. DEED has developed and encourages local governments to adopt Suggested Local Government Guidelines for administering flood recovery funds.

Local government applicants also must complete one MIF Flood Application outlining their recovery fund needs.

Following the submission of these materials, local governments may develop loan and grant agreements with business recipients. DEED will disburse funds for each recipient as information is received.

For More Information
Contact Bob Isaacson at 651-259-7458 or email bob.isaacson@state.mn.us