Investment

City releases $ 5 million in emergency funds for residents and small businesses – Southwest Journal

Mayor Jacob Frey. Photo file

The city of Minneapolis is providing $ 5 million in emergency assistance to low-income tenants and small businesses in response to the coronavirus pandemic.

The funds will mainly be dedicated to tenants earning well below the area median income (MAI) and to businesses in areas of concentrated poverty.

“We wanted to make sure that the money was going to those who have the most difficulties first,” said Mayor Jacob Frey.

The city will provide around $ 2 million in emergency aid to low-income households that have been economically affected by the coronavirus pandemic. Households earning less than 30% MAI, or about $ 27,000 per year for a family of three, will be eligible for $ 1,500 relief on rental and utility bills. Payments will be made directly to owners and businesses, Frey said.

Benefits will be available to all residents, regardless of immigration status, a break from federal and state relief programs.

The mayor’s executive action, which does not require city council approval, will also add an additional $ 1 million to the Stable Homes program, Stable Schools, which provides financial assistance to families earning less than 50% of the MAI, about $ 45,000 for a family of three. The program will be expanded to include families enrolled in all of the city’s schools.

To help people with mortgages, the city will invest an additional $ 275,000 in the Minnesota Homeownership Center to provide free counseling services to residents. The Homeownership Center has counselors who help people negotiate with lenders for forbearance and mortgage repayment or forgiveness.

Minneapolis is also ready to partner with nonprofits to spend up to $ 3 million of existing funds to buy natural affordable housing if real estate speculation escalates.

“We are concerned that the speculative buying will hurt NOAH’s actions in the city,” Frey said.

For small businesses, Frey’s action would provide $ 2.2 million in repayable loans to businesses with fewer than 20 employees that have annual sales of less than $ 1 million and are located in disadvantaged areas or cultural districts. Forgivable loans will be available in installments of $ 5,000 or $ 10,000 and will be used for payroll, rent or accounts payable. The loans will be canceled if the business is still operating in the city within a year.

Eligible businesses must be located in a cultural district, a green zone or a zone of concentration of poverty (ACP50). In southwest Minneapolis, these areas include the Whittier and Lyndale neighborhoods, parts of Lowry Hill East, and portions of cultural corridors along 38th Street and Lake Street.

Much of the business funding will come from the city’s Great Streets local business program. Housing finance comes mainly from block grants.

For businesses across town, Frey’s action will reduce the current 2% loan program to a 0% loan program. The city will match loans with private lenders for $ 50,000 or $ 75,000.

In total, these programs will likely help around 2,000 households and 200 businesses, the mayor said.

“These measures alone are not enough,” Frey said. But he thinks it’s a first step in helping people “hang in there” as state and federal relief dwindles.