On Monday, December 14th, the Minnesota Legislature passed the COVID-19 Economic Assistance Package, aimed at providing aid towards struggling small businesses and those still in need of state unemployment assistance. Governor Walz signed the bill into law on Wednesday, December 16th. With a cost of roughly $240M, the package includes four bills:
- Grants for small businesses impacted by Executive Order 20-99
- Extension of state unemployment assistance
- Hospitality industry fee waivers
- Extension of the application deadline for free/reduced lunch
Important Takeaways for Minnesota Businesses and Residents
Grants – ($216M)
$88M to the Minnesota Department of Revenue for Small Business Relief Grants, available to businesses that were directly affected by the government order noted above.
MKS: Eligible businesses listed in the legislation are restaurants, bars (including breweries/wineries/distilleries with taprooms), coffee shops, catering companies, bowling alleys and most gyms/fitness centers. The key item to know here is that these grants will not feature an application process – rather, the state will calculate grants and issue funding based on internal sales tax and unemployment insurance data. We recommend reviewing a summary of the grant program here, and keeping a close eye out for a communication from the Department of Revenue in the coming days.
$14M to the Minnesota Department of Employment and Economic Development (DEED) to issue funding via grants to convention centers and movie theaters.
MKS: These grants will require an application, which will become available in early January. Convention centers that apply must have occupancy of 1,500 persons or more, and theater grants will be based on the number of screens. Further information (and the eventual application release) is available on the MN DEED website.
$114M to all 87 Minnesota counties based on population (with a minimum allocation of $250,000) to stand up more focused grant opportunities for their constituents. Each county will have discretion over the funds, and these programs are not required to support only those businesses affected by the aforementioned executive order.
MKS: We have continually advised clients to periodically contact their county or city offices for localized assistance programs. This is more important than ever for those that remain affected by the pandemic.
Extension of State Pandemic Unemployment Assistance
Unemployment benefits under the CARES Act allowed applicants 39 weeks (versus 26 weeks) of eligibility due to the pandemic. With an expiration date of December 26th, Minnesota has preemptively chosen to allow applicants to continue collecting state benefits for the full 39 weeks.
MKS: This bill was passed solely to protect Minnesotans on unemployment in case federal legislation is not passed to extend the pandemic unemployment assistance before the end of 2020. It is expected that Congress will continue to support the state unemployment programs for an additional 3-4 months (likely at a reduced rate of $300 per week vs. $600).
Bottom line – many are still in need of assistance via the unemployment program, and there is a structure in place to continue the benefits for eligible recipients through Q1 of 2021.
Hospitality Industry Fee Waivers
Certain fees issued by the Minnesota Department of Public Safety related to bars that serve alcohol until 2 a.m. (and caterers that serve alcohol) will be waived. In addition, breweries will be refunded on wastewater treatment fees, and establishments subject to Minnesota Department of Agriculture license renewals will not be penalized for late payments.
MKS: We recommend business owners that operate in the hospitality industry review these waivers in more detail with the related state agencies.
Extension of Deadline for Free/Reduced Lunch
The deadline for school districts to determine a student’s eligibility for free and reduced lunch has been extended from December 15, 2020 to January 4, 2021.