March 23, 2026 · Jobs and Economic Development · 21,421 words · 26 speakers · 322 segments
Members will call to order. The Committee on Jobs and Economic Development Today is Monday, March 23rd, and we have a quorum. Members, today we will hear a number of bills. We'll hear Senate file number 927 from Senator Pappas, Senate file number 4527 from Senator Pob, Senate file 4535 from myself. And last but certainly not least, Senate file 3977 from Senator Rest. It is important for me to just remind us that we welcome everyone that's here. We are so excited that you are here. We appreciate your interest and participation in the legislative process. But to ensure that everyone can view here and understand today's proceedings, we ask for your cooperation and maintaining decorum and civility throughout these hearings. So for safety, security and comfort of all attendees, please note the following guidelines. One, that I have to maintain control in these proceedings and establish the following expectations. Signs and placards are not permitted in the hearing room. Verbal outbursts, shouting or disruptive behavior will not be tolerated. I know this one, the next one is hard for me. Applause or other audible demonstrations are not allowed because I would hope that you would cheer profusely whenever I'm doing a bill, but I know that that can't happen. But just remember, we're doing all these things for your safety. So standing or sitting in walkways and aisles or standing or obstructing at your chair is prohibited. If you require any accommodation, please speak with our sergeant staff that you see those folks around and you can tell that we have some upgraded or we've made some changes, changes around security. It is not because of wanting to be difficult, but we wanted to make sure that everyone remain as safe as possible. I hate to say this, but it's true. Failure to comply with these guidelines may result in removal from the hearing room. Our goal is to conduct these proceedings efficiently while ensuring everyone the opportunity to observe and participate. So thank you in advance for understanding. As you know, anyone who's going to testify, you'll be given two minutes. And we take two minutes seriously. So we time you when you come up to speak. What I often remind individuals of is I think it's great that if you are coming behind someone to testify that you build on what they say, not repeat what they say because we want as much information as possible. So thank you again. Thank you for your understanding. And this is just that gentle reminder. And just note that we have a full agenda today. As you'll see, we have a long list of testifiers and we just want you to know that we are excited again that you are here. So first up, we have Senator Pappas presenting Citadel number 927. And if you may, if May Yetao and Lily Dow can join her at the testifiers table, that would be great. And remember, if I mispronounce your name in any way, blame it on my head and not my heart. And you can certainly correct me on the record. Senator Pappas, I understand that you have an A2amendment. Is that correct?
That's correct, Mr.
Chair.
And is this the first stop for this bill?
First and only.
Say it one more time.
First and only.
Oh, yeah. Okay, let's do it. All right. So members, there's the A2amendment that you see. It's an author's amendment. And so we want to put the bill in the shape that the author would like it. All those in favor of the A2amendment say aye. All those opposed say no. The motion prevails and a two amendment is adopted. Senator Pappas.
Thank you, Mr. Chairman. I'm here on behalf of the Hmong American Partnership. The Hmong American Partnership has a long and proven track record of advancing workforce development by meeting individuals where they are and supporting their path to sustainable family supporting careers. Founded in 1990 here in Minnesota, HAP impacts over 5,000 individuals annually in workforce development alone, often with waiting lists for its high demand workforce programs. HAP's approach is centered on preparing individuals for real opportunities in today's labor market. Through industry aligned training, job placement, career coaching, and supportive services, HAP helps participants gain the skills, credentials and confidence needed to enter an advance in the workforce. This appropriation invests in that workforce pipeline, supporting job training, employment services, digital skills, and critical supports that remove barriers to participation. These efforts ensure individuals are not only placed into jobs, but positioned for long term career growth and economic stability. Hap's culturally responsive community based model strengthens both workers and employers, helping build a more inclusive, skilled and resilient workforce across Minnesota, especially as our economy continues to evolve. Now, I'd like to turn it over to Mary A. Tao, who's president and CEO of hap.
Welcome to the committee. Please state your name for the record and give us your two minutes of testimony. Again. Welcome.
Thank you. Chair, Champion and members of the committee, thank you for the opportunity to testify today. My name is Mainza Tao. It's spelled Mayor, but it's pronounced Mainza. And I'm the President CEO of the Hmong American Partnership. With us today is also Lily Tao, a recent graduate from one of Our workforce development programs. At hap, we don't just run programs, we change trajectories. We serve individuals who are ready to work but need access to training, credentials and support. Through our workforce programs, we have served nearly a thousand individuals with over 800 placed into jobs earning an average of $21 an hour. And more than 300 students earning industry recognized credentials. Yet today, over 150 individuals remain on our wait list, ready to work but unable to access services due to limited funding. This is an immediate workforce gap and workforce development alone is not enough. Also, through our role as a community development financial institution, we provide small business development and access to capital, working alongside entrepreneurs to build strong small businesses. Small business plan plans strengthening their operations and growing sustainable businesses that will last and create jobs. And the need is just as urgent. Businesses are ready to start up and scale up, but lack the access and knowledge to capital. The HAP impact is real. Individuals increase their earnings, further strengthening Minnesota's workforce. Families begin to build wealth, often for the first time. And small businesses grow. This is how we build a stronger Minnesota from the ground up. And direct appropriations serve as catalytic capital strategic investments that unlock scale and rapidly amplify impact. With this support, we can expand training, reduce waiting lists and strengthen our small businesses. Thank you for the time to testify.
Thank you so much. And we will now go to Lily Tao.
Yes, Lily Tao.
And if you will state your name for the record and give us your two minutes of testimony. And then after this testifier, then we'll ask questions.
Hello Chair and members of the committee. My name is Lily Tao and I'm here to share how Hmong American Partnership helped me become a certified Nursing Assistant. Before I started at hap, my life revolved around caring for my children. Being a mom is my greatest blessing, but it also comes with real challenges. I was doing my best to balance everything while knowing deep down that I wanted more. I wanted a career where I could grow and make a difference. When I first came to hap, I was nervous and unsure of myself. But that quickly changed. The instructors and staff didn't just teach us, they supported us every step of the way. They were patient, encouraging, and made sure we truly understand the material. More importantly, they helped me believe in myself, even on the days I doubt it. Through this program, I didn't just earn my CNA certification. I found my purpose. I gained hands on skills, real world experience, and the confidence to move forward. I learned that being a CNA is more than a job. It's caring for people in their most vulnerable moments. And making them feel safe, seen and valued. And today I'm proud to say that because of hap, I am now working as a cna. I am deeply grateful for this opportunity and for everyone who supported me along the way. Programs like this don't just train workers. They change lives, strengthen families, and build our workforce. Thank you for your time.
Thank you so very much for your testimony. Members, any questions to the testifier or to staff testifiers or. Senator Pappas. Senator Pa.
Thank you, Chair Champion. So I don't have any questions, but I do just want to thank Senator Pappas for bringing this bill forward. She's been a huge champion for nonprofits to do great work for the entire St. Paul area and honestly throughout the state of Minnesota, because I know they have done some great work in my area as well. So. And I want to say HAP is doing great work. Their work needs to have investment from our state. And this is a good step forward in that, so we can continue that good work. Thank you, Senator Champion.
Thank you, Senator Paz. To Madal. I have a question I see on line 1.7. This is either for you or Senator Pappas. I see wealth management, and that usually falls outside of what we do around workforce development. But can you give us some context as to what that means and what is it that you all do that promotes wealth management?
Thank you, Senator Champion. Last year, HAP underwent a new strategic plan. And the strategic direction that came out of that was that HAP would drive everything economic prosperity throughout hap, which includes driving financial education, financial literacy throughout workforce development, through our direct social services, through our CDFI ARMS as well. And the wealth management is really teaching our communities that we serve. How do they manage their finances that could hopefully start building wealth towards generational wealth?
Mr. Mum, can you give us a financial picture as to what we've done in the past, what they're asking now, and whether all of the funds that they had previously through deed, if those are all spent, and if you don't know the answer to that, we could also call DEED and ask them as well.
Mr. Mum, Mr. Chair and members, there was an appropriation in the jobs bill in fiscal years 22 and 23 for $300,000 a year from the Workforce Development Fund to the Hmong American Partnership. And in fiscal years 24 and 25, it was $1 million per year from the general fund. That appropriation was made available through the end of this fiscal year in last year's jobs bill, and I believe all but a nominal amount of that has been expended, and there was no additional appropriation in last year's jobs bill.
Any other questions for Senator Nelson?
Thank you, Mr. Chair. I had a few questions, but your question brought up an even a greater question for me, and I thought I might address that. First, could you tell me, Mr. Chair, where you saw the words wealth management? I'm looking at that in the delete all amendment.
Thank you. So if you look online, line 1.7. I'm looking at the A2. We should be looking at the A2.
I'm looking at the A2, line 1.7. Oh, yes, yes, yes, yes, yes. Okay. What I'd like to mention that is just to mention that wealth management has a much broader meaning. I would suggest that that term be changed to financial literacy. Something like that. And so, Mr. Chair, if perhaps your staff could produce an oral amendment that would change the words wealth management to financial literacy.
State your motion.
I would move that the words wealth management be replaced by the words financial literature.
And we'll ask council to report the. The proposed change.
Mr. Chair, members, Senator Nelson's amendment would be on line 1.7. Delete Wealth Management and insert financial literacy.
And I'll go to Senator Pappas for your thoughts on. On the Nelson motion.
Mr. Chairman, I just consulted with President Tao and that's fine.
Any other discussion on the Nelson motion? Senator Herr.
Mr. President, I just wonder if the council will be able to define the word wealth management as. Well, we all have different definition. Does it. I mean, the amendment align well, but just want to see if there's technical definition out there that could help us understand that phrase much better.
Senator Hur, I believe that you were asking whether there was a term of art, you know, based on either one. And so the clarification that needs to be presented is whether the wealth management is more for business or workforce development to the testifier.
Thank you, chair. Definitely it would be. Again, as I just shared earlier, our new strategic direction is driving everything economic prosperity throughout all of hap. So the financial education, wealth management was an aspiration. It's more aspirational language, but it would be through workforce development and our economic development arm, small businesses and individuals such as Ms. Lily Tao here.
All right, members, we're on the Nelson motion that will modify the word or change the word on line 1.7 from Wealth Management and replace with financial literacy any. Senator Pratt.
Thank you, Mr.
Chair.
And I was just to Senator Herr's question. I was just looking up the definition. So as we look at the definition of Financial literacy. It's the personal ability to understand and use various financial skills where wealth management would be an advanced holistic service typically provided by a professional. So I think, as I've heard the testimony, Senator Nelson's amendment is a good one.
Any other discussion on the proposal saying none. All in favor say aye. All those opposed say no. The motion prevails and the amendment is adopted. Any other questions on the on the bill as amended.
Mr.
Chair, Senator Herr, I just want to
voice my support on Senator Pappas request here and also want to say that being a person that lived in Minnesota for more than 30 years and I seen the exception of the Hmong American Partnership from four staff to, you know, now hundreds of staff and also provide resource and empowering. Is my audio okay?
No, I'm just starting to listen.
And empowering, you know, the community in growth. You know, in, in some terms this is almost like the Hmong American Partnership is almost like the IRRB of the Hmong community and Southeast Asian and broadened. They're not restricting, just helping Hmong American, but everyone, although it has a Hmong name label, but it opened doors to Somali, East African as well and being a resource for all of us and now Broaden, expand from St. Paul to the larger Minnesota. So just thought I'd throw a little history there and commend the work that they do. I also want to take this time to thank Senator Pappas as well. And I thank her so many times being that I'm almost an elder now in my community and I see the growth and the progress of the Hmong American community. And San Pappas is truly one of the leaders that help our growth as well. Thank you, Sam Pappas.
Senator Nelson, thank you, Mr. Chair. And I share the strong support for HAP. I've seen some of the things you've done before. Very, very, very. I appreciate. I do have a further question on the handout that I have here and I wanted to just mention the first block says over a million in supporters services provided, including housing, transportation and clothing support. Well, I'm not at all worried about clothing support. I don't think we have a state program for that, however, and we're glad everybody has clothes. Okay. So. But what I do want to say is that I am somewhat wondering about housing and transportation support. Those are things that are provided in other parts, parts of our state budget and our overall state, I guess, overall state budget. And so when we talk about housing and transportation, you know, those things would go to housing and transportation committees. And I just have to wonder if that is really the best way to describe that. Or maybe you can describe for me what is HAP's involvement in including a million dollars in support for transportation and housing. What does that look like?
Mr. Chairman and Sarah Nielsen, if I could first clarify that HAP does a very broad range of services. What this bill is focusing is on their job training that they do in their workforce development. So that's one other part of what they do. But this funding does not go toward housing and transportation support. Other funds are used for that. And President Tao, did you want to add.
Yes, if I may, to the testifier.
Thank you, Chair. And thank you so much, Senator, for the question. We call those supportive service dollars and we leverage from other grant opportunities, whether it's through other state agencies or private foundation grants. And we just believe, Senator, in serving the whole person, we know that individuals, families will come to our workforce courses. But if they are stressed because of not having the funding for transportation to get to our courses or to a job, they don't have access to healthy foods for their families, they don't have housing, affordable, safe housing, if they come to our courses, they will not be successful because of all the stressors happening in their lives. And so if we can serve them holistically by providing them some stipends for supportive services, such as childcare dollars, clothing is actually for their career clothing. So CNA would be scrubs, for instance. But it's truly leveraging other funding opportunities to serve them holistically so that when they come to us for workforce courses, they can be present and not be so burdened by other stressors happening in their lives.
Senator Nelson, follow up.
Yes, Mr.
Chair, thank you. And thank you for the further information. Definitely supportive. I'm definitely supportive. I think we all are of supportive services and working with these other supportive services as well. So people can be financially literate, can pursue a job, a career and wealth building. But I am reassured because I heard Senator Pappas say that none of these funds that are coming from the workforce development fund are used for that supportive housing or supportive transportation. So my question has been answered. Thank you.
Any other questions before Senator Pappas gives us final words? And we will. Our intention is to lay the bill on the table for possible inclusion. CNN Senator Pappas, you.
Thank you, Mr. Chairman. I would just turn the page over then and look at actually what the, the request from you would fund, which is on this side of the page, which is very much directed toward job training services.
All right. Seeing no further discussion. We will lay senate file number 927 on the table for possible inclusion. Thank you. Thank you, Senator Pappas, and your testifiers. We'll now go to senate file number 4527, Senator Paul, for small businesses. And if we can get Juan Lopez and Alicia. Alicia Glover to join her at the table, that'd be great. And Senator Powell, when you are ready, you can start the presentation.
Thank you. Chair Champion, I do have an A2amendment I'd like to go ahead and introduced. Yes, it is a DE amendment to clean up the original language and incorporate feedback from the organizations and the businesses that we were able to get additional feedback on that original language. Senator Champion.
So does everyone have the A2amendment? Seeing that everyone has it, Senator Pa moves adoption of A2. All in favor say aye. All those opposed say no. I'm sorry, she. She just talked about what. What the amendment was. Senator Pross. Sorry about that. We know that you did go through it already. Members, again, we're on the A2amendment. Seeing no. No discussion. All in favor say aye. All those opposed say no. The motion prevails. The A2 is adopted. And just so that you know it's a delete everything amendment. Senator Fox.
Thank you Chair Champion and members for this opportunity to present SF 4527, a bill that supports small businesses impacted by the increased federal presence in Minnesota. These are extremely trying times for small businesses across the the state. Many have experienced alarming losses in revenues and sales and significant disruptions to their workforce. As many of you have heard, as well as myself from our small businesses in our districts, these challenges have left many businesses financially strained and some, especially minority owned businesses and micro businesses, on the brink of closure through no fault of their own. SF 4527 is a revamp of a couple of pandemic relief grant programs. By proposing a lottery to help deploy grants as quickly as possible. For the lottery process, DEED will ask current partners with active contracts for other DEED programs to help review applications. This bill was launch a competitive RFP process to catch any businesses that did not get selected in the lottery or may need more assistance. The bill will also allow for grants up to $20,000 and then forgivable loans over that amount for a period of two years. Of anything for a period of two years with a cap of $250,000. For the forgivable loan grants up to 20,000. Forgivable loans up to 250,000. There would also be a process for cultural mall operators as well, in this bill, businesses who are eligible are small businesses with less than 50 employees, have a permanent physical location and have lost at least 20% in revenues or sales from July 1st of 2025 to February 2018. 8th of 2026 is the time period we're looking for compared to the prior year revenues that they had. This bill would include registered in home businesses such as child care providers, small farms, small construction contractors, cleaning services and salons. Chair I want to thank Carrie Johnson from MCCD for all of her work in working with so many of our stakeholders and organizations and small businesses, and especially our CDFI coalition. There's been a lot of work put into this bill to make sure that we heard from all the people who are impacted and all the stakeholders that serve them as well. In your packet, you'll see that there is a letter of support from 47 organizations and 25 small businesses chair members. I am asking for your support today in making sure that we help our small businesses with the Small Business Relief grants and loans. Thank you, Chair Champion.
Thank you, Senator PA. We will now go to your testifiers, and once the testifiers are completed, then we will ask questions. If that's okay with you, Senator PA.
Yes, thank you.
All right, we'll go to Juan Lopez. You have two minutes and state your name for the record and give us your two minutes of testimony. Thank you for being here, Chair Champion
and members of the committee. My name is Juan Lopez and I'm a small business owner in St. Paul. My family and I operate the Perfect Coffee Tromperiel sac in Municipala Chiquis, a neighborhood grocery store on Rice Street. I also serve on the Rice and Larpenter Business Association. From December through February, our businesses experienced a sharp decline. At one point, our grocery store dropped about 30% of its normal sales. Foot traffic slowed significantly, and we lost inventory as perishable items expired. But what I want to emphasize is this. The impact was not just lost of revenue. It was increased cost to survive. We stayed open. We adapted. We paid overtime to employees who showed up, arranged transportation to ensure staff could get to work, and invested in online ordering and delivery systems. Many of these decisions did not make financial sense in the short term, but we made them to keep our doors open and support our community. I also want to share that a strict revenue loss threshold may leave some small businesses behind. It does not fully account for the additional expenses required just to remain open during this time. For example, the Perfect Coffee has not yet been open for two full years, which may make it harder to qualify even though we've already endured months of construction and impact last year. I have shared these concerns with Senator FA and I want to thank her for her commitment and willingness to work towards the solutions to ensure this relief reaches as many small businesses possible. Small businesses like mine are not just economic engines. We are community anchors. We did our part to stay open and serve. Now we're asking for your support to recover and rebuild. Thank you for your time and your consideration.
Thank you so very much. We're going to go now to Alicia glover and if Ms. Linda Sloan would trade seats with you from the Council for Minnesotans of African heritage. Go ahead Ms. Glover Chair Champion Members
of the committee, My name is Alicia Glover and I am the owner of Demi Tastes Good Treats, registered under Creativa Demi LLC. In 2020, during the pandemic, I turned my hobby of baking and decorating cakes and into a small business and operating as a cottage food producer out of my home in Osio. Since then I have grown my business, expanding my baked goods offerings, built a solid customer base and booked a lot of events. I love my business and I get so much joy from the people I meet. I love the way families and community come together to celebrate with my creations. I am currently in the process of getting my license from the city of Minneapolis and hope by summer I can transition to work out of the new Neon Collective Kitchen, the shared commercial kitchen space in North Minneapolis. At the end of last year, my business took a dramatic turn. In December and January, my orders decreased, events were canceled and much smaller in size and a lot of people could no longer afford to purchase custom baked goods. In total, my revenue decreased by 40 to 50%, or about 3,500amonth. The economic impact of the federal presence in Minnesota hurt my business so much that I had to take my son out of pre K because I could no longer afford the monthly expenses. I'm trying to make up for the lost revenue by working more and taking on additional orders, which comes at the expenses of time with my family. I am here today to ask for your support to help small businesses, including in home businesses like mine. Thank you for the opportunity to testify today.
Thank you so much for being here. We sincerely appreciate it. Linda Sloan from the Council on Minnesota of African Heritage and before you, while you're presenting, I'm going to ask Willem Willametta
yes sir.
Are you online? Yes, I am. Okay, great. And then since you're online, I'm going to ask Janie Seaber. Yes, if you're here, if you can Join. Are you online also?
Yes, I'm online, Senator.
Okay. All right. All right, I see it now. All right, so. So the next two will be online after Ms. Sloan. Ms. Sloan, welcome to the committee. State your name for the record and give us your testimony.
Thank you. Good afternoon, Chair, vice chair and committee members. My name is Linda Sloan. I'm the executive director at the Council for Minnesotans of African Heritage, or sema, as finally known. And I first, I'd like to thank you for the opportunity to speak with you today about the importance of economic relief like legislation for businesses and communities impacted by federal enforcement activities. The impact of the enforcement surges have been devastating. I don't need to repeat what the images that you have seen over the last several months, but both in terms of business and financial losses, and also in terms of mental health and social trauma, which will stay with our kids communities for generations. CIMA submitted a letter to the committee that details our support for economic relief measures based on the feedback that we received about business and community concerns and challenges. Two things that I want to highlight today from feedback that we received is one, relief grants are more effective than loans for helping impacted business businesses that have suffered major losses and are at risk of closing or if not closed. However, we believe that both are extremely beneficial. And then secondly, constituents want to ensure that impacted businesses and communities are not unintentionally excluded from relief opportunities based on their geography, region, and types of of business, businesses and enterprises. So again, thank you. I appreciate the opportunity to speak with you today. And we urge you to move Senate file 4527 forward.
Thank you so much, Ms. Sloan. I'll now go to Willametta Kennedy, state your name for the record and give us your two minutes of testimony. Welcome.
Thank you, sir.
Good afternoon, committee chair and committee members. My name is Willem Meadow Kennedy. I'm a business owner located in Corn Rapids, Minnesota and with an MBA. Prior to starting my own business, I worked 30 years in the banking and finance industry, including Wells Fargo, where I worked at a disbursement specialist for 14 years. I actually left the industry because of my passion for entrepreneurship and I started the business in 2011-2025 and the business has grown from just a grocery store to a grocery and a deli store. And I'm the only African store within this community. So last year, things changed for me. On December 10, two ICE agents when I opened a business day, two ICE agents walk into the store and presented me for notice of.
All right, appears that we're having a little Technical challenges. Are you back with us, Ms. Kennedy? Ms. Kennedy, we are having a difficult time.
I could not sign an inspection during that time between the ICE and myself were free. So I say it actually impacted.
Miss Kennedy, we are having a difficult time hearing you. So what I would suggest is if you be so kind as to send us your testimony electronically and I'll make certain that it gets to all members. So we sincerely appreciate you trying. I'm now going to Janie C. Beret. I might be right or wrong.
Yes. So say Bori. Say Bori.
Okay, there we go. All right. State your name again for the record and give us your two minutes of testimony. And welcome. Welcome. Welcome to the committee.
Thank you, Senator, chair and member of the committee. My name is Jenny Sivuri. I'm a small business owner in Brooklyn Center. I'm the owner of the Cavalla Travel and Tourist being in business for over 16 years. And I'm one of the founding member of the United Business Women Investment Group Foundation. We support BA women entrepreneurs and community development. I'm here today to support Senefa 4527 Grant. That grant we believe
technical difficulty.
Okay.
That grant I believe would support our small businesses affected by the recent ICE enforcement activity in Minnesota. Small businesses are the backbone of our community. Most of them are owned by the backfire entrepreneurs who have invested their life saving time and energy to build businesses that support their families and serve their neighbor. In recent months, many of our businesses have been directly affected. At Kavala Travel and Toys, which I own, I work with many immigrant families and travelers. During the period of the Houston ICE activity, many people became afraid to travel, attend events or even freedom move within the communities. This created an immediate drop in business activity causing businesses to lose revenue or in some cases temporarily close. Many members of the Unite Business Women Investment Group foundation have shared similar experiences. Some own restaurants, salons, retail shop and service businesses. When fear spread in the community, customers stay home, workers are afraid to show up and small businesses lose income overnight. These businesses are the hard working entrepreneurs who are doing everything right, creating jobs, paying taxes and contributing to Minnesota economy.
Thank you so very much for your two minutes of testimony. If there's some additional information that you'd like for us to have, please feel free to send it to us electronically and I'll get it to the rest of the committee. If you have one last sentence, I'll let you have one last sentence, but that'll be it.
Yes. So I respectfully urge you to kindly support this bill. Thank you.
Thank you so very much. Thank you. To all the testifiers members, if you have some questions, you can start now. And I have a question before right before Senator Draheim. Senator Pa I noticed that on the Delete all that you are using, the period in which to consider individuals receiving grants or any loans appears to be the period of July 1, 2024, through February 28, 2025, and then also the period of July 1, 2025, through February 28, 2026. And that's located on the lines 1.16 through 1.18. Can you explain to us why you're using those timelines when Operation Metro Surge did not really rear its unfortunate presence in the state of Minnesota, not until December of 2025?
Senator Pop thank you, Chair Champion. Carrie and I actually had a very long discussion on this. I asked Carrie Johnson from mccd up here in case there's questions for members, because she's the one who's been working with all of our stakeholders and small businesses. As you guys know, last year, starting In January of 2025, there had already been a lot of action here here in the state of Minnesota when it comes to federal immigration enforcement. A lot of our communities were already impacted as early as last January, and businesses were already starting to feel that impact. It didn't get to the point in which we all saw very apparently that we were under siege by federal agents until December, but there were businesses that were reporting their revenues and sales being impacted as early as March and May. There were family members, community members, residents here that were reporting to me already of their loved ones being detained by ice, of their workplaces being raided. And so this was this has been an ongoing issue all of last year. There's a few businesses in my district who started feeling the impacts of ICE enforcement as early as last spring. And so we didn't want to necessarily only concentrate on the time when there was this huge surge, December 1st, but recognizing that there are businesses that started suffering way earlier than that, and could they also show their losses from that period on throughout to February 28th? And that's why we started with July 1st, because we had to pick a date. But the real reality is that we have a lot of businesses that were impacted last January.
Sorry about that, Senator Draham.
Thank you, Chair and Senator Pal, for bringing the bill forward. My first question has to do with you, Chair Champion. You know, on the original bill, I think it had $100 million on it, and the targets haven't been discussed yet publicly at least, and just Wondering, you know, looking at the state as a whole and our committee jurisdiction,
What do
you perceive the target is going to be for this committee and you know, what percentage of our target is going to go to this bill.
Thank you Senator Ham, for the question. So it has been decided that there will be no targets because in order to do targets there has to be agreement. And I recognize that from this bill they are asking for 100 million from the general fund. But you'll also see in my bill where I'm asking for 100 million from the Minnesota Forward Fund, which does not have any impact on the general fund.
SENATOR JOHANN so we're pretty much this is going to be our target more or less then would be 100 million is what I'm kind of reading, because your bill is not going to have any fiscal impact as far as our fiscal rules go, would that be correct?
That is correct.
Senator Pa. If I could. Have you ordered a fiscal note for this?
Senator Draham I have and Chair I have not yet.
And our intention, Senator Draheim, is to lay this bill over for possible inclusion. Chair Senator HAM thank you.
Has there been any discussion with nonpartisan staff on maybe. Senator Pa. The fiscal cost for the agency to run such a program or any guesstimate?
Senator Pa.
Senator Draham and Chair Champion yes, we are going to be exploring what that cost would be. We just have not done it yet.
Senator Johann thank you.
Chair and thank you. Senator Pa. You know, when I looked at the E2amendment, little concerned about including registered home based businesses in this, you know, they wouldn't have to leave their house. I wouldn't think, you know, people didn't have problem going anywhere because there was nowhere to go because it was based out of their homes. So I personally think that needs to be adjusted. And then the 20% decline over that time period, that, that is in my opinion not much of a decline for eight months or whatever. Whatever you have it here, I believe it's eight months. So to me I think that should be higher. And then the on 2.1 you have a million dollars per operator and then on 2.11 and 2.12 up to 4 million with those big numbers in the bill. Senator Pa. Do you think this is enough to help out everybody that would be impacted or would have a 20% decline over that eight month period to spread out across the state?
Senator Pa.
Senator Draham and chair champion I don't think that 100 million is enough. I don't. And we wish that we had more Because I think that our small businesses need more money. But knowing that we do have these mall operators and there are businesses that are tenants within that operation or mall that's going to need help. There's a couple that we've been talking to in trying to tailor this bill to what, what they have seen happening in their malls and saying, what can we do to help and what would be something that could make a difference? And these were the kind of the numbers that came out of some of those conversations and discussion. But I absolutely believe that if we had more money, for sure, our businesses would need it and could use that money.
Senator Juihan, Chair, My suggestion is that we amend 2.1 and 2.12 to have a lower number. If you're afraid that you're going to run out of money, I would rather see a smaller number and maybe a second option, another bite at the apple, if you will, Senator Paul, to lower those numbers. If you're worried about that, you know, I'd rather see it spread out. If we're gonna do this and I'm not gonna support your bill, you know, you know me, I'm very transparent. But I think if you're really trying to help people across the state and you're afraid you're gonna run out of money, I think these numbers are too high. And then what if I could continue, Senator, thank you. What safeguards you have in here to avoid the hot topic across the media with waste, fraud and abuse? I know you have a couple lines in here, but in your own words, what do you think you've crafted in your bill here to prevent another feeding our futures fraud program?
Senator Draham, chair champion on 4.3 all the way to about 4.9 there. We did add this section to it that we didn't have in our, our first original bill to try and address some of that. As you know, there's been a lot of talk about fraud. I truly believe that night the majority of businesses that are applying truly need it, and there is no fraud intent. This is something that we compromised on to put in, to put some security, some measures in. But DEED will also have its own process to be able to make sure that the funds are being used the way that it's appropriated for and that they're looking through those applications along with our CDFI organizations who are also going to be partners in distributing these funds as well. It's going to operate a lot like the COVID funds that we were able to give out during COVID time, in which CDFIs throughout the state of Minnesota were partners in trying to distribute these funds to businesses that were in need as soon as possible, because right now we are in that time where it's very urgent how quickly they can get these funds and whether or not that means the business will continue to operate or business will have to close.
Senator Ham, follow up?
Yeah, thank you, Chair, and thanks for your patience too. Chair does this have another stop Chair Champion besides this committee?
No. We will lay this bill over for possible inclusion.
So I'm wondering if we could ask DEED to come up and comment on the safeguards in this bill if they feel it is strong enough language.
And as DEED approaches and it's my understanding your question is also around both in the bill, period, grants or loans, Is that correct? Mr. Senator DRAHAM Yes.
Thank you.
All right, Mr. Valjry, Mr.
Chair, members of the committee, Devin Bowdrey, Government Relations Director at Deeds. I think these measures that are listed under subdivision 7, line 4.3 to 4.11 are things that we already do. I think this looks a bit like
comfort language to me.
And we have all of the 16 A, B and C statutes that we already follow as well.
Senator Ham, any follow up before we go to the next question?
I'll wait on the rest of my questions. Thank you, Chair and thank you, Senator Paw.
Senator Nelson thank you, Mr. President. Senator Pa, thank you for bringing this bill. I do have a few questions, things that kind of jumped out at me and I won't expect an answer on each one as I say it, but I will kind of list some of the things that I thought this causes me some consternation or thinking about. I noticed online 1.10 for eligible businesses, at least 50 they must be at least 50% owned by a resident of the state of Minnesota. Well, when we're using Minnesota state taxpayer dollars, we kind of look at helping out Minnesotans. So I'm a little concerned that half of those dollars could go to people who aren't Minnesota residents. I also noticed on line 1.28 this idea about, well, excuse me. No, not that. The part I was concerned about was the double dipping. I'm just wondering, is this double dipping on page one you're talking about grants to eligible businesses and you kind of list those. And then over on the next page we talk about grants to operators. So those would be the landlords who own the businesses that are eligible for the grants on page one. And so I'm just saying, is there some double dipping here? In other words, there's the eligible use of the business. And then there's also the grants to operators. Maybe I'm reading that wrong. I hope so because it does look like double dipping. But then the bigger concern that I have has to do with two things that are clearly in the bill. One is that grants are selected through a lottery. Typically when we take hard earned Minnesota taxpayer dollars we don't put it out to provide needed services based on a lottery. So I think there is a better way. And then the bigger part truly is the grants and forgivable loans. I think that is a bit concerning when I read that if there's been over 20,000 of eligible impacts under this program qualified that they can apply for no interest forgivable loan up to a quarter of a million dollars. That is a rather low threshold with a shocking loan forgiveness amount. And then if that weren't concerning then I believe I read that the business is eligible for a 50% loan if they've maintained operations for one year. Well I could see that happening quite frankly, but the business is still not performing. It's living off the state proceeds for one year and then the other half is forgivable. So I think I know it's well intended Senator Paul, but I think there's some more work to do here. And then on page three, if the business is operating consecutively for two years, it's 100% loan forgiveness. I think you would have every taker for that. I'm just saying that is something needs to be done here. This is much too broad and it does not not ensure that the funds will be used I think in the way that you are seeking or that Minnesota taxpayers would require. And it's also a large amount as well. So I hope Senator Paw that you can work with some of your team to really scope this down to maybe what your intention is. But there's just too many holes in this for me to support today. Thank you.
Thank you Chair Champion. Thank you Senator Nelson for your comments as well. We are still working on this bill to improve it. But I just want to let you know that this bill really is intended to help businesses who were impacted by federal enforcement and they have to. It's just not any business that's has lost revenues but businesses specifically being impacted because of all the Metro surge, the immigration enforcement. This is things that are out of their hands and now their businesses are suffering. Now their businesses are at the brink of closure. And so I understand about the forgivable loan but some of these businesses can't afford especially our small Businesses can't afford to pay back a huge amount of loan and this will be able to help them if they stay in business and put that money into good use to be able to bring their business back up so they can operate. Then that's what we're trying to do. We are requiring that people stay in business if we're going to give them money. So it's not just giving money and all of a sudden, a couple months later or a year later, they're closed. But the intent is to help businesses get back on their feet because of what has happened here in Minnesota. I also want to say that to your point about the 50% ownership by residents of the state of Minnesota, there are some businesses here who have been severely impacted and they may have a partner that doesn't a partner in their business that does not live here in Minnesota, but one of the partners do. And so it's not saying that businesses that don't belong, that are not owned by Minnesotans are going to get these money, but there are several small businesses where they have someone who's also an owner who does not reside in Minnesota. We don't want to penalize those businesses who one of the owner lives here and operates this business to not be able to get these funds if they have been truly impacted. So that was something that came out of again, the many conversations we've had with small businesses and also with stakeholders for this bill. I do have Ms. Johnson here as well, and I think Ms. Johnson wanted to touch base on one of the points that you brought up. So I'm just going to give her
a minute to do that to the testifier. You could take a minute to answer the question and then we're going to go back to the committee and and my intention is the latest over possible inclusion. So to the testifier then I'll go
to Senator Brad thank you. Senator Champion, Senator Nelson, I wanted to address on line 2.1 the grants to operators. The intent is if you are a business owner operating in a cultural mall that you would be, you would have to go through that process to avoid the double dipping. We certainly don't want that. That is not the intent of this language. And then also I just wanted to address the lottery process. This is something that was done during the pandemic. The Minnesota Lottery actually ran the lottery. It's purely for expediency because it was able to cut the time in half by utilizing existing partners at DEED, who many are CDFIs and organizations that have existing contracts that are up to date on reporting metrics and have no concerns with deed and then just simultaneously run a traditional RFP process. But that would take about double the amount of time to get funds out. And our hope is to save as many businesses as we can so that we, you know, can get them, make them whole and get them back to operating fully. Also, in terms of the. The no interest forgivable loan that could be. If there are multiple locations of businesses, like one business, but they have a couple of locations, that is the sheer reason for the dollar amount. But up to 250,000. But that doesn't mean that everybody can automatically get that. You would have to still meet criteria and not even every business that applies would get the full 20,000 either. They would still have to demonstrate the revenue or extra expenses that were taken under during that time period.
Senator Nelson, you wanted to follow up?
Sure, I'll just follow up and I'll be brief. And I just want to say I'm a small business owner. I understand the challenges of being a small business owner, especially in this state. But what I want to say is, quite frankly, I am shaking inside when I hear that we think we should model anything over how we did pandemic funding. One of the things that we have seen over and over and over, and our state is known across the nation for this, is that in the effort of Minnesota to be expedient during pandemic funding, we have reaped fraud, much fraud. I'm not saying your bill here, Senator Pa. But I'm saying I would never use how taxpayer dollars were doled out during COVID as a rationale for any new legislation going forward. I believe we should learn from those lessons, and I am very concerned. Senator Pa, I understand your concern about small business owners, absolutely. I just do not think this bill, with all respect, Mr. Chair, I do not believe this bill is ready for primetime. And I cannot support state dollars going to something so loosely defined, sent out on a lottery, especially in the wake of when we see what happened in our last effort to prevent massive challenges.
Senator Mohamed, you had a question?
I guess my question is, considering this bill is going to be laid over for possible inclusion, are you suggesting that you'll have another finance bill since you're moving yours out of this committee?
I'm not suggesting that it would be laid over for a possible inclusion. I've had a ton of conversation with the, with the chief officer in this bill.
Okay, so. So there will be another omnibus bill?
There will be an omnibus bill, yes. On Wednesday.
Okay, so you'll possibly include it into that.
Possibly. Senator Pratt.
Well, thank you, Mr. Chair. And you know, I think a number of the issues and concerns have been raised. And I want to reiterate what Senator Nelson said. You know, building this upon our experience in Covid is fine, but it doesn't take into account any lessons we learned during COVID I look at this, there's no requirement on how long a business has been open. As you mentioned, Mr. Chair, the dates of this go well beyond what we would have typically considered to be metro surge. And I think we also have to remember that it was Minneapolis and the Hennepin County Commissioner that failed to provide mutual aid and support like crowd control, traffic management, those types of things that allowed some of the situation to get out of hand. Now, I'm not saying I've talked to small business owners, employers and employees that were impacted, and I know there was definitely an impact. I'm, I'm not denying that at all. But what I am saying is that in some cases it was the decisions of the local governments that exacerbated the problem. There is no fraud prevention in this bill. Let's just be honest to say that this statement was a compromise, I think far short of what it should should be, that somebody has to say fraudulent applications will not be tolerated and information from any suspected fraud app will be reported to state investigating authorities. Mr. Chair, we've talked and talked and talked about the fact that attestation is not a fraud prevention tool. It just isn't. There's nothing here that talks about what constitutes a, a business that is in good standing. It talks about it with the Department of Revenue, but it doesn't talk about it with the Secretary of State. And as we saw, we tried to put that Secretary of State requirement on. The governor took it off on a supplemental grant program. And, but it makes me concerned if we've got small businesses out there not following the rules of licensure, not following the rules of registration that are able to qualify for these funds. The fact that, you know, the fact that we do have nonprofits that are sub granting these loans is just another way of saying we as a state have lost control over who qualifies for this and we're relying on somebody else to do that follow up. And it hasn't been worked before and it's not going to work this time. So I'll be interested to see, Mr. Chair, that if this makes the, the bill on Wednesday. But I think there are, you know, between now and Wednesday, there are a lot of problems with this. And I won't even go into, into the problems with forgivable loans. You've known that problem, you know, you've known that concern with me for many years. And there's no, you know, and the fact that there's no repayment requirement in order to be forgiven just continues to make this a, I think a bill that, as Senator Nelson said, is not ready for prime time.
And, and Senator Pratt, thank you for those comments. But if you look at line 1.14, that's where it has Secretary of State, because I know that you, you mentioned that it has both Secretary of State and, and, and Department of Revenue. And we're going to go to Senator Dreha. Oh, did you want to say something, Senator Powell, before we go to Senator Dreheim?
Senator Powell, thank you, Chair Champion. I just wanted to give a few comments. I know there wasn't a question from Senator Pratt necessarily, but a few comments to Senator Pratt's thoughts that he shared. I want to say, you know, small businesses during COVID time were severely impacted. As we all know, there are small businesses that are severely impacted now, nonprofits that do CDFI that are CDFI certified and they have been a partner in trying to help our small businesses get back up on their feet. They do technical assistance. They do a ton of work with small businesses. They are the organizations that can help us get these funding directly to those businesses that need help. And not only that, but helping them to get them back up with those technical assistance and anything else. It doesn't make sense for us not to leverage our nonprofits that already do fantastic work in the state of Minnesota helping small businesses. I don't believe that small businesses that have been impacted by ACE enforcement and immigration enforcement here, that they should be left out by themselves. If we, we do not supply some kind of assistance, these businesses are going to close. They're going to. This has been detrimental. They're not going to be able to recover. They're going. And if they do, it's going to take them years to recover from some of their revenue loss. A few of the businesses in my district have gone out to the banks to ask for money so that they can at least keep their business afloat, just a loan they've been denied. So how do we expect our businesses to be able to sustain, stay afloat if we're not able to help them? So thank you, Chair Champion.
All right, we're going to go to Senator Draheim and then we're going to lay the bill over possible inclusion. Senator Draheim.
Thank you, Chair and Senator. Pa I do appreciate you bringing this bill forward. And you know, as a small business guy myself, as probably the only one elected that had a business shut down for a whole year during COVID I get it. So I just want to assure you I do appreciate you taking an interest in helping out small businesses. So I just want to put that on the record. But I do think this bill needs a lot more work, and that's why I can't support it today. But you did mention you thought it was a statewide issue. And I would like an amendment, an oral amendment. Chair and I, of course, will request nonpartisan help, but somewhere under section two on page four, some language. And I know this is gonna get laid over, but I just want the committee to know where I'm coming from ahead of time so we have time to work on the language. And if it's put in omnibus bill. Chair, I know it'll be up to you, but I would like this broke up by congressional district for a time period, and if it isn't spent in all the congressional districts, then it would go back to the most needy congressional districts. So if we could go to nonpartisan staff and just kind of get a.
Senator Draheim, can I convince you to maybe work with Senator Powell on that language after committee so that we don't have to do it now?
Sure.
Yeah.
That's. Work through it.
I appreciate that, Chair and Sarah Pa Like I said, if this is truly a statewide issue, then we need to divide it up by congressional district, equally spread out across the state. And any funds that aren't used would go to the districts that were more heavily impacted. So thank you for your time.
Chair.
Thank you. With that being said, Senate file number 4527 will be laid over for possible inclusion. Members of will now go to C file number 4535. And Senator Gustafson will chair as I present.
Senator Champion, when you're ready.
Thank you, Madam Chair. First of all, I want to say thank you to everyone who's helped work on this bill. There are too many to name, but we've been working on this incredibly hard for weeks to try to make this work for as many businesses as possible and to make sure it would be implemented effectively while being an extremely proactive about preventing any fraud. If you all know why we are here presenting this bill, we had an informational hearing on the economic impacts that ice activities had on businesses across our 7 metropolitan area and across the rest of our great state. You heard the city of Minneapolis alone talk about their loss of roughly $200 million. The sad reality is there's no way that we will be able to make our businesses completely whole. The impacts were too great. And this bill cannot undo the trauma, the destruction of people's lives and the deaths of Renee Good and Alex Preddy. But we are doing our best to get these businesses as much help as we possibly can and as quickly. Quickly as we can. Just for context. And then I know that we have the A2amendment that we'll have our great council go through, but this Bill is providing 0% forgivable loans to businesses that were impacted by ICE. After making payments on time for two years, the remaining 60% of the five year loan will be forgiven. We have constructed a system to help businesses in greater Minnesota and also the seven county metro area who both have distinct needs. And thank you to the Initiative foundation and others who have helped us make these tiered systems work as well as possible for all regions of our state. There are a number of testifiers who are here and who are going to talk about this important issue. So I'll wrap up my comments by saying we thought it would be important to make sure that we do forgivable loans. There was some discipline discussion about grants at one time, but we talked about the sensitivity around the grants and the ability to get them out. And it was a cross section of challenges that we thought. But most importantly, we wanted to make sure that people had skin in the game. And if they had skin in the game, then we wanted to show that there's sustainability by them being around and for us to step up as a state to still forgive. And with that being said, before we go to my first testifier, I'd like just to get the bill in the shape that would be most appropriate. I'd offer the A2amendment. And then afterwards I'll ask Senate Council to go through the A2amendment.
Senator Champion moves the A2amendment. Members, any discussion? All those in favor say Aye.
Aye.
Opposed?
Motion prevails.
Senator Champion, please go ahead.
And if Ms. Fontaine can go through the A2amendment, that would be great.
Ms. Fontaine. Thank you, Madam Chair and members. I'll just try to go through this pretty quickly based on having gone heard Senator Paz earlier. Bill, the A2amendment creates a Minnesota Business Recovery Loan Program. You'll see on line 1.5. There's $100 million appropriated from the Minnesota Forward Fund account for loans under this section. And of that amount, 18 million would be to the Minnesota Initiative Foundations it does say that it would be distributed based on the demand of the region relative to the purpose of the loan program. So it wouldn't go out in equal amounts. It would be based on that demand in the region. And then 82 million would be for grants more focused on the metro area to go out through those nonprofit corporations. You'll see there it designates partner organizations and those would be that are already enrolled with DEED for certain programs, emerging entrepreneur programs and other programs. So they already have a partnership with DEED for this type of loan activity. The administrative expenses would be at 5% for the partner organizations and then 2% for deed to administer and for oversight of the program. The period I think we discussed for Center Champions program would be beginning December 1, 2025 to February 28. That's kind of the look back period. Senator Champion did work with DEED into to try to incorporate some of their ideas for how to best tighten up the loan program. And you'll see on page two it talks about the commissioner purchasing a participation interest in loans. And then also the agreements are considered financial assistance agreements and not procurement or grant contracts. And this kind of gets at the issue of of what are some of the other grant agreement kind of controls and other procurement requirements for these loan agreements. And then the commissioner would also adopt guidelines and forms to implement this section. It also establishes an account for the money to be deposited for use for the loan program. Subdivision four on page two talks about about the eligibility criteria for the loan. So under Center Champion's proposal the business would need to be owned by one or more permanent residents of the state. It would have to be a permanent physical commercial location, be in good standing. Again, the annual gross receipts are you'll see down with the corresponding sections for the metro and Greater Minnesota on line 2.20. You have to the business would have to have at least one employee on payroll. This would exclude sole proprietorships from the program and then the demonstrated loss in revenue that is greater than 30% during that time period as compared with the same period during the previous year. So subdivision five loan participation. The partner organizations enter an agreement with the commissioner and then the commissioner purchases 100% participation interest in the loans. And the partner organization is responsible for underwriting and servicing and monitoring of the loans on line 3.1. This was another thing that came out of some conversations with certain groups that the partner organizations would need to conduct outreach to publicize the loan program in culturally and linguistically to those communities within the service area served by the partner organization. So under Subdivision six and seven, it separates between the initiative foundations and then the seven county metro area it goes into. For both programs or for both in greater Minnesota and the metro, the minimum state contribution would be $2,500. And then that goes into the maximum amounts based on annual gross receipts. And then both would have would be for five. A loan term of no more than five years, 60 months. In subdivision eight, it discusses the loan purposes and these need to be. These would be for payroll, lease, mortgage payments, inventory, insurance, property taxes, utilities for operations exclusively in Minnesota. And then it talks about that the borrowers need to provide that evidence that they were used for eligible purposes and then prohibits uses including consolidating repaying debt accrued to December 1st or speculation or investment real estate. You'll see that there is allows for deferred payments. So loan repayment payments would not need to begin. They would have three months to begin the loan repayment. So there's a little deferment there on page four. Senator Champion mentioned the loan forgiveness mechanism. And this would be after two years that the borrower could forgive up to 60% of the loan. We did take some of the language from Senator Paz. Bill in subdivision 11, this is that fraud deterrence measures. I know DEED mentioned that this would already be sort of standard, but it is included here just to have applicants certify that they understand the notice and the repercussions for fraudulent activity in subdivision 12. This is a way for the loan repayments to go back to deed within 30 days after the end of each calendar quarter. And then you'll see that the loan repayments will be returned to the Minnesota Forward fund account to replenish the money that was used for this purpose. There are reporting requirements for both the partner organizations. There is an initial report from the commissioner of deed due by December 1st of 2028 and then a final report due on April 1st, 2034. And then the program would expand expire on December 31st of 2033. So that is the loan program. Then in section 2 would be an analysis that would come from DEED or a third party nonpartisan group to prepare a report that is an analysis of the economic impact from the increased immigration enforcement in Minnesota. It talks about the elements to be included in the analysis. I also forgot to mention this. There's $250,000 appropriated in July from the general fund for this analysis. But you'll see what the analysis needs to include. Impacts on business sector specific impacts, supply chain impacts, impacts on consumer spending and a number of other items to be included in this analysis. And that would require that the report or the analysis would be due to the legislature by February 1st of 2027. And that is the A2amendment.
And just a couple things, Madam Chair, if I may just for clarity, when you look at on the first page 1.15 where it talks about for grants to nonprofit corporations. That's grants to. To CDFIs. Those are. That's for CDFIs, not nonprofit organizations as we would traditionally think about it. Nothing against nonprofit organizations. I just want to make sure that we're really clear as to what's here. The second thing I want to make sure that we are clear about is around the loan forgiveness. The whole idea is that within that 24 month consideration consecutive on time payments it would roughly be around 40%. And so that's why 60% because that is that says we will forgive the rest of it. I know that Senator Pratt and we've talked about attestation, but we layer that on top of the relationships. And the reason why we went with CDFIs is because those CDFIs are already a part of deeds proposal portfolio and have background with them, confidence in them and they're from across the state. So if there's a CDFI and they lend out some money, they will have the backing of the state. That deed will take that loan 100% so that no one is left holding the bag. So that's why we did not name anyone. And just so that for folks know that is a reason why I don't name individuals because I want to make sure that everyone gets an opportunity across the state. And last but certainly not least, I hope I mentioned everything. Yes, those are the three points that I wanted to make.
All right, thank you, Senator Champion. If we can go to your testifiers, we will start with Scott. If you can say your name for the record and proceed when you.
Thank you, Madam Chair, Members of the committee, my name is Scott Marquardt, President of Southwest Initiative foundation. We serve the 18 counties, Lower Sioux community and Upper Sioux community of Southwest Minnesota. I'm grateful to be here to express my urgent and deep support for Senate File 4535. The Immigration Enforcement actions have had a real and detrimental impact on businesses in the main streets, commercial corridors, neighborhoods, industrial parks and AG sector throughout greater Minnesota with a real loss of revenue and an impact on working capital. I specifically represent the great communities of Worthington, Wilmer and other cities which have been impacted in real dollars. And that impact continues to have an impact on the families and the employers and the communities that are represented there. This is absolutely a business retention and succession issue. We are getting calls from our amazing businesses and entrepreneurs routinely wanting to be optimistic but expressing their concern about what this will mean to today and tomorrow. Not only rural critical community need businesses throughout all of our sized communities, but it's also impacting job retention, workforce attraction, impact on the tax base and a real concern about risk on future investments. In closing, what I'd really like to lift up is this proposed bill maximizes the program integrity, lessons learned and successes from both small business emergency loans in small business loan guarantees which had a notable and powerful impact on our small businesses. I'm grateful to the agency and the legislature for your trust in implementing those programs. We specifically had personal direct touch with the over 75 businesses that received SBEL loans and close to a dozen that had loan guarantees. I put my physical signature and reputation on every one of those approvals because we believed in the rigorous the process and the eligibility and the fraud prevention standards that went in that most importantly, balanced rigor of tax dollars with access from historically underserved people and folks that don't have access to traditional markets. Thank you Madam Chair, Senator Champion, members of the community. I'm hopeful that this urgently needed relief will be advanced soon. Our communities statewide need it. Thank you.
Thank you very much.
Thank you very much. We'll now move to Carl Swanson. Please state your name for the record and proceed.
Good afternoon and thank you so much for the opportunity to speak on the importance of small business relief. My name is Carl Swanson. I am the Coalition strategist for the Minnesota CDFI Coalition. CDFI stands for Community Development Financial Institution. This is a federal certification through the U.S. department of the Treasury. We have over 35 certified CDFIs and CDFIs in process in revolving loan funds across across the state of Minnesota in every Congressional District. Senator Raheim and these organizations provide small business support, affordable housing development and capital to under resourced, underbanked and under financed communities across the entire state. And if you don't know the acronym cdfi, you know these organizations. Habitat for Humanity of Minnesota, Greater Minnesota Housing Fund, Neighborhood Development Center, Women Venture, a number of other ones. You know, businesses that have been supported by CDFIs. The Minnesota CDFI Coalition is here today because CDFIs are partners to businesses at the startup stage, to banks and philanthropy to grow opportunity and prosperity and to local, state and federal government to connect communities to capital resources and trainings. CDFIs have rigorous certification reporting requirements making these organizations trusted, responsive and Ideal intermediaries. We are often the first money in for entrepreneurial ideas, the cheerleaders for small businesses and entrepreneurs building from the ground up. And we are often the partners that help bring projects home by closing financing gaps. CDFIs come in when others will not. And we know the value of investing in community. When someone is hurting on Main street, we know and we know that that hurt is real and happening right now. In 2025, Minnesota CDFI is an almost $700 million invested through 2,400 loans across the state. Research from the Minnesota CDFI Coalition in partnership with Greater MSP Pacific mapped 14 corridors across the Twin Cities Metro estimating a loss of $213 million in a 10 week period. This is backed up by research from the City of Minneapolis, by Northstar Policy and by others showing hundreds of millions of dollars of lost wages and revenue and drops in consumer spending. We know this is not limited to the metro area. Worthington, Wilmer, Forest Lake, Fergus Falls, St. Cloud, Red Wing, Rochester, other cities across the town, across the state. State have been impacted. We are here in support of Senate File 4535 for small business relief through loan through Zero interest Loans. We want to thank Senator Pa for supporting Main street through Senate File 4527 and working on behalf of small business relief across the whole state.
Thank you, Mr. Swanson. We now have council member Elliot Payne. Please state your name for the record and proceed.
My name is Elliot Payne. I'm the president of Minneapolis City Council. It's an honor to be here. Thank you Madam Chair. Thank you Senator Champion. And we've all heard about the impact of Metro surge starting in December. But we really wanted to quantify that in the city of Minneapolis. So we did some preliminary estimates that found 76,000 residents were already facing imminent need for food assistance prior to the surge. $47 million in lost wages, $81 million in lost revenue for small businesses, nearly $5 million in lost revenue due to hotel cancellations alone and $15.7 million in rental assistance needs. This is just a point in time estimate, just for the month of January. And it's just so that we can understand the scale of the need. And the scale is great. We are very grateful that at City Council we made a seven million dollar investment directly in supporting small businesses. But we know the need is far greater than that and that's why we need the support of the Senate. And that's why I'm here to speak in support of SF 4535. We know that Minneapolis is the epicenter. Lake street specifically was hit very hard. As the center of our immigrant community, we would welcome any amendments that targeted that. But we know that the impact is far greater than the city of Minneapolis. We've heard reports from Wilmer, from Mankato, from Rochester, from all across the the state. And your partnership is going to go a long way to a swift recovery, which we know that we desperately need. And we know that this disruption was one time. And you know, we saw people coming back to those businesses in huge numbers. And in fact, a week after Renee Goode was killed, I was in a line out the door at a business that had closed right after that tragic killing. And then all the a sudden I had to drive over to Senator Champion's district because there was another shooting. These were all out of our community's control and it created a profound impact. And so passing this bill is going to be crucial for our recovery.
Thank you so much Council member Elliot Payne. We now have Mayor Nadia Muhammad, Madam
Chair and members of the committee. My name is Nadia Muhammad and I proudly serve as the mayor for the city of St. Louis Park. I am here representing the Cities for safe and stable Communities which is a coalition of 31 Minnesota cities who are here not well here in spirit with me in support of Senate File 4527 and Senate File 4537 35. I should say while operation Metro Surge may have winded down, the economic impact is just beginning to surface. We are also getting preliminary data and so across our coalition we have estimated 150,000 immigrant and foreign born residents who are directly affected cities have occurred over $400,000 in direct costs. Emergency grants have reached over 1.4 million with additional funding pending. Hundreds of businesses have reported loss of 50 to 100% loss. Thousands of students have shifted to remote learning reducing daily school meals in St. Louis park alone. Small businesses have reported that this has been. This experience has been worse than Covid for them. Residents or I should say restaurants, markets and salons have lost customers overnight. One business had to close over has the close had to close down over a month six weeks due to staffing shortage as well which lead to which led to losing revenue and thousands in inventory. Others have taken on debt to state to stay open when businesses cannot pay rent. We know that the impact spreads to property owners as well as the broader local economy. Of course our coalition here today is is here to request to two things. Acknowledgement of the economic harm that was done to our cities as well as support for the 2026 relief funds for both small business owners, owners as well as residents who were pushed to the brink. Cities did not create these conditions. We can all agree that we did not create these conditions. Unfortunately, we are responsible for the aftermath and for addressing the aftermath. So we kindly and with the utmost respect, ask for your partnership in stabilizing our local economies and restoring. Restoring local governance that our residents deserve. Thank you for being here. And thank you. Thank you, Senator Champion.
Thank you, Mayor Muhammad. We now have Russ Adams.
Can I just make sure that we properly stated her title? Because I didn't hear it. She's the mayor of St. Louis park, and I wanted to make sure that we.
I said it both times because I have much respect for any woman in leadership.
So thank you.
I made sure to say it. Thank you for being here, Mr. Russ Adams.
Thank you, Madam Chair. Members of the committee, I'm Russ Adams. I manage the corridor recovery initiatives for the Lake street council in Minneapolis. You've heard a lot about Lake street over the last six years, and our businesses don't feel like they've gotten much of a break in those six years. Over $250 million in property damage happened after the civil unrest. They have struggled to get back on their feet. We've had road construction projects that have slowed them down on Lake street as well as Hennepin and soon Lindell Avenue. More recently, tariffs and other economic conditions have made it very difficult for building back. Now. The businesses that exist that managed to restore their inventory and have been trying to prosper fell into disarray this past winter through unexpected and swift results that they had no way to plan for. The worst possible timing for some of our Latino businesses is to lose your customer base during the winter holiday season. So when they say that they feel like they can't take any more debt, we take that very seriously. We are very supportive of Senate File 4535. We're glad that the state sees a role to help the businesses. You've done it before. I can tell you that the main street economic revitalization program did a lot of good for Lake Street. So did the Lake street lift program that was passed a few years ago. But our businesses now find themselves once again struggling to keep their doors open. Both the CDFI bill that you heard before, you and this bill have the right approach in terms of helping with working capital. We may differ on whether you should have grants or forgivable loans or straight out loans, but I have heard most of the folks on this committee recognize that there was economic impacts for businesses.
Mr. Adams, if you could just quickly finish up your last thought.
We're over on time.
My last thought is we are counting on you to step up and help our businesses recover. Thank you.
Thank you. Next we have Liliana Latran Garcia. And if I mispronounced your name, please state it correctly for the record.
Madam Chair, Senator Champion and committee members, my name is Liliana Letran Garcia and I am the CEO of Comunidades Latinas Unidas and Servicio, otherwise known as clus. I assume this position after the recent retirement of our longtime senior CEO, Ruby Lee. And I am very pleased to be here with you today to testify in support of Senate File 4535. Senator Champion's bill to create a recovery loan establishment program. CLEWS is Minnesota's largest Latino led nonprofit, serving more than 30,000 individuals each year across the Twin Cities and Greater Minnesota, including offices in Austin and in Wilmar. For over 45 years, we have delivered culturally rooted services that strengthen families, workforce participation and economic mobility. We are so grateful to Senator Champion for putting this bill forward and recognizing the needs of the communities that were and continue to be so negatively impacted by the Metro Search operation. The Latino community and its small businesses in particular, particular were hit very hard by these activities. And we strongly support this legislation which will direct funds to eligible entities so they can keep their businesses running. For example, a Latino owned cleaning company we support lost multiple contracts within weeks, not due to performance, but because clients past operations and workers became unavailable. The business is now at risk of shutting down, affecting both the owner and the families they employ. Again, thank you. And thank you to Senator Champion for his work in this critical issue. Thank you.
Thank you very much. Next we have Linda Sloan. Please state your name for the record and proceed.
Good afternoon.
Linda Sloan. I'm the Executive Director for the Council for Minnesotans of African Heritage. Thank you for the opportunity to speak again. Very briefly, SEMA urges committee members to support relief legislation for impacted businesses, workers and families. They are hurting. They need our assistance. In our discussions with business and community leaders, they emphasize that grants are preferable. But the combination of relief in the form of grants and loans would be so powerful and extremely beneficial to their recovery efforts. Constituents want legislation that aligns with the diversity of impacted enterprises to ensure that some impacted businesses are not denied relief. So again, thank you. We urge you to help our communities and move Senate file 4535 forward. Thank you.
Thank you very much, Senator Champion.
Thank you, Madam Chair, we could go to the two online or go straight to Julian Ocampo, who is a business owner who's also on our list.
Thank you, Senator Champion. We'll try our first online testifier, see if we had technical issues with them earlier. Maybe it'll work this time. If not, we'll give it a few seconds to see if we can connect. Otherwise, we'll move on. Williametta Kennedy, are you able to connect with us?
Yes. I'm sorry for the technical.
That's okay. You've got about two minutes for your testimony.
Okay. Like I was saying, Good afternoon and chairman cheer and committee members. My name is Willametta Kennedy. I'm a business owner and prior to starting my own business, I worked in the finance industry for 30 years and including Wells Fargo, as I stated earlier. But my business, I started a business in 2011 up to 2025. It has grown from a deli store. Now we have a grocery store attached. On December. On December. On December and 10, I was visited by ICE, presented me a notice of inspection, wanted for me to give all of my employee information. There are nine physical address. And in that period, with the exchange between them, I had my customers in the store. Some of them flared, and the news quickly spread in the community and people are afraid to even come to purchase. And this actually affected my business. A chunk of my customers are afraid for their safety. And then second, on December 29th, again, I visited the store. This time they came with our notice of inspection. And I just consider it as a form of harassment and intimidation. And so this compelled me to get a legal representation and had to incur expenses, legal expenses that I didn't plan for. So financially, my business is almost on a deathbed. So that's why I'm very passionate about this, to ask that this bill be approved. If you look at the financial status for 2025, the quarterly report, and quarterly report in 2026, I'm looking at almost $20,000 difference in my income.
Ms. Kennedy, I'm sorry, if you could finish up your last part of your statement. We have to move on because of the time limit.
So recently I'm struggling. I'm asking you to kindly approve this legislation that will provide relief for my business.
Thank you.
Thank you so much. Next we have online Jani Sieber. If you could join us and limit your testimony to around 2 minutes. You can proceed when ready.
Thank you, Madam Chair. Again, Madam Chair and member of the committee, thank you for giving me the opportunity. My name is Janice Siburi and I'm a small business owner in Brooklyn Center. I own the Kawala Travel and Tours and I have been in business for over 16 years serving the community and also one of the founding members of the United Business Women Investment Group Foundation. We support Backfire, women entrepreneurs and community development. Today I'm here to support the Senate 54535. As a small business owner, I have seen firsthand on how enforcement and activity and economic disruption can significantly impact businesses like mine. Many of us operated up, many of us operate with limited resources and unexpected setbacks that can make it difficult to stay open, retain employees and continue serving our community. This bill provide a critical lifeline for us. It gave us access to recovery loans will help small businesses stabilize, recover and continue to contribute to the Minnesota economy. This bill will also help protect jobs and ensure that the backfire entrepreneurs who already face systematic barriers have a fair opportunity to succeed. Supporting small businesses means supporting the community we serve. When small businesses survive, neighborhoods remain vibrant, families stay employed and local economy grows stronger. I respectfully urge you to support the 75, 4535 and provide the relief that small businesses need to recover and thrive. Thank you for your time and consideration. I give it back to you. Madam Chair.
Thank you so much. Next we have Julian Ocampo. If you could state your name for the record and proceed.
Julian Ocampo, Good morning, Madam Chair and members of the committee. Thank you for the opportunity to speak today and for considering the needs of small businesses across Minnesota. My name is Julian Ocampo. My family owns the Los Ocampo Mexican restaurants across Twin Cities. I am a Double Tommy at St. Thomas and this year's recipient of the Spirit of St. Thomas Award that will be announced in a month or two, I think. And that's why I feel the need to be here on behalf of my business, our business, alongside 12 other small business owners who are helping lead this effort. Because we were directly impacted, we've submitted a letter on our behalf which you have in your handouts. Over the past year, especially during Operation Metro Surge, our business experienced sudden and severe impacts. Many of us saw dramatic drops in sales, lost employees due to fear and took significant debt, took on significant debt just to stay open. Some businesses were forced to close and others are still at risk of not recovering. While we are beginning to see customers return, the damage has already been done. We are working to rebuild, trust, rehire staff and catch up on overdue obligations, all while facing continued financial pressure. We are here today in support of Senate File 4535 and to thank Senator Champion for his leadership. This bill represents a critical step forward toward helping small businesses recover from these unprecedented challenges. So we respectfully ask for your support in passing this legislation quickly and to consider expanding eligibility so that newer business, those in cultural corridors and those who experience significant sales declines can also receive support. Our business employ hundreds of Minnesotans, contribute millions in tax revenue and are a part of a fabric of our communities. Give us the chance to recover and we will continue showing up for Minnesota the way we always have. Thank you for your time and for standing with Minnesota small businesses.
Thank you. And I understand we have another testifier here at the table. If you could state your name for the record and proceed. You have less than two minutes or about two minutes.
Thank you. Good afternoon, Madam Chair, members of the Committee. My name is David Campana. I am the Legislative and Policy Director of the Minnesota Council of Latino Affairs, MCAA NCAA is a state agency that advise and informs the state legislature and government on issues relevant to our diverse Latino communities. NCAA is also part of the Minnesota Latino Leadership Alliance MIA which also supports this testimony. The conceit wishes to express strong Support for Senate 54535 with particular emphasis on the urgent need to support Latino owned businesses, workers and families in Minnesota who have been disproportionately impacted by the recent immigration enforcement surge. Latino small businesses are a vital and growing part of the Minnesota economy. Minnesota is home to at least 1700 Latino owned businesses supporting approximately 17,000 jobs as well as more than 10,000 service employees, entrepreneurs. Recent reports show that Latino businesses have experienced sharp declines in economic activity with many reporting drops in sales of 40 to 90% as workers and customers stay home to fear and uncertainty. In this context, Senate 54535 and also Senate 54527 are not just aid packages. They are strategic investments in the resilience of a community that has historically driven Minnesota's growth. By providing 100 million in relief through funding, grants or loans, the state recognizes that the recovery of a small business sector is linked to the stability of Minnesota. MCA urged the Committee to move these bills forward to ensure a full and equitable recovery for all. Thank you for your time and attention to this important matter. And thank you Senator Champion and Senator fa, for your work and leadership.
Thank you so much.
Thank you very much. Members, any discussion, any amendments? Senator Draheim and then Senator Mohamed.
I'll let Senator Muhammad go first.
Thank you, Senator Muhammad, so kindly.
Thank you.
Mr.
Chair.
I have a few questions. Number one is can you tell me sort of Your like where you got the number for. Because you put $18 million for the Minnesota Initiative foundation and then like 82 million million for grants to nonprofit corporations that meet a certain criteria.
Senator Champion, Madam Chair, thank you, Senator Muhammad, for that question. We got the numbers from talking to a cross section of people, including those in the metro area as well as the Minnesota Initiative Foundations. What we learned is that that would be an appropriate amount based on what they believe that they would need, but it all would be a part of one pool, and the CDFIs will be able to draw from or participate that particular way. But we got the numbers from talking to a cross section of businesses, organizations and people.
Senator Mohamed I think, well, as somebody who was on the ground, I am very aware of where ICE agents were targeting in our communities. I think businesses from my community can directly tell you that whether they're on League street, on Minnehaha, on Nokomis, on Cedar Riverside, they will all tell you that. And when we did the Promise act and it impacted communities, that businesses that were impacted by the uprising, we made numbers that were direct to the communities that were impacted. North Minneapolis had more numbers.
South Minneapolis had less.
Why did you not write the bill that way, Senator Champion?
Madam Chair, Senator Muhammad? Here's why. A couple reasons. One, I, I think it would be unfortunate for us to try to compare the Promise act to this particular bill. One of the things that we did know, even when we did the Promise act, that south Minneapolis, specifically your district, and, and Lake street, got an overwhelming amount of money and got more money than anyone else. And we looked at, at the numbers and so we saw that how north Minneapolis and other places have been left behind and that Lake street and others were able to thrive. And we still tried to make sure that in any presentation that we kept Lake street in mind, South Minneapolis in mind, we kept St. Paul in mind, the rural folks in mind, so this wouldn't be an appropriate place to carve those things out. Now, what I will say is we know that south Minneapolis and other places have been dealt with horribly. You know, the impact of ICE has been bad. It's been hurtful for a cross section of entities. But that's also why we didn't just give the Minneapolis, excuse me, the Minnesota Initiatives foundation, an equal amount of money, because we recognize that some people may be impacted more than others, which is why we were very thoughtful around CDFIs, because wherever those CDFIs are, they would be able to make loans and they, and they get 100% of those reimbursed for an example, since you raised Lake Street Council and that's someplace that you represent, they have a great relationship with lisc. LISC is a cdfi. They would be able to look at those businesses along Lake street or in south Middle East Minneapolis or other places where they have a reach and they will be able to respond to that business and those businesses expeditiously.
No, I don't. Madam Chair. Senator Mohamed so I don't disagree with the idea of it going to CDFIs. I actually fundamentally agree with that. I think that's the right way to go. I do have a question of how the numbers are allocated. $82 million to a certain place, $18 million to the Minnesota Initiative Foundation. I think I say that because when I think of my community, the ones that have less relationships with CDFIs. Lake street has certain relationships with certain people in the community, but not all. Cedar Riverside doesn't necessarily have a certain CDFI that they work with. Carmel Mall, that's like another one. There are certain communities that have been heavily impacted by the Metro Search that don't have those relationships that were not consulted in this bill. And I can tell you that because I have been having those conversations. My other question for you is on section two of the bill, there's $250,000 to study the impacts, the economic impact of Metro Surge. I guess I have few questions around that. Like is your understanding that you don't know what the numbers are on the economic impact of Metro Search in our communities?
Senator Champion So thank you. Let me answer two questions. Senator Muhammad. I think that you will agree that you're not the only person that talks to people in our community. So I consider your community, my community, like for an example, the African Development Corporation, they're cdfi. I've had conversations with them as well. So even when you think in terms of the information in section two, sure we know, but one of the things that would brought up and was discussed by a cross section of people, including Senator Paul, is the fact that we should make sure that we have all of the information and there are possibilities that there are some impacts that we don't know about. But for there to be this intentionality around gathering that information in hopes of it not being able to help us as we put forth this recovery or the relief that we talked about now, but can inform us for even next session. Have those businesses fully recovered. What are some things that we're unable to get support around? And so that's the forward thinking that we try to do. When we looked at section two.
Senator Mohamed Madam Chair. Thank you Mr.
Chair.
I think I do agree that there are numerous of communities that have to be a part of this and state studying what the impacts are when it comes to Metro search is the right way to go about it so we can have so we can approach it with a holistic understanding. I brought up this conversation because few weeks ago we did have a hearing on the economic impact of Metro Surge and we heard from the owner of Przana Downtown Council but we did not hear from Lake Street Council or African Development center number of other like directly organizations that directly work with our immigrant communities. We didn't hear from businesses that have security guards sitting outside of their business so that they can protect their employees. We didn't hear from restaurants that have lesser menus. That is I think why I'm bringing that up. Very often we do hear from big business and I'm worried about this Is shaped by CDFIs and organizations that have lobbyists and the money to hire some and not those that haven't. It's why I'm bringing up this conversation because I think it's the right conversation to have. My other thing is if we don't know the impacts are then why are we introducing $100 million bill? Where is that number coming from?
Senator Champion, Senator Madam Chair, Senator Muhammad, just so I can answer your last question first. First of all, when we had the impact we sent out information to everyone. Anyone who wanted to be here could be here. We also got some of that testimony from other businesses too. Like for an example, we didn't get every single person from the city of Minneapolis. We relied on their information but we still put out the notice that anyone could come in and testify. So we feel like we have information from them and that they are seen in this bill. Secondly, it wasn't big business or anyone that helped us frame this. It was a cross section of people and even the CDFIs and business owners and others who really put forth their ideas and we tried to gather and aggregate all those ideas and as a result of that that is why we have this information or the bill that you have before you.
Madam Chair. Senator Mohammed Senator Champion, I my understanding is you're probably not going to accept my amendment which was going to be a certain amount of money to Lake street businesses. So I won't introduce that as I will wait for Wednesday's other bill. I do have a motion though and I'd like to remove section two of the bill because I think we have A clear understanding of what the Metro impacts are, what the economic impacts are for Metro Search. And I'd like to put, put that $250,000 into a part of the $100 million so that it can go directly to the businesses that need that support.
Madam Chair, Senator Champion, two things.
One is
when you think in terms of Section two, that was something that the committee talked about. There's also the folks from Explore Minnesota. There is a cross section of people that came in to talk about the importance of gathering that information. So we took the advice not just of Senator Pa, but also the others that came here. And let me also be very clear about what you said, that I'm probably not going to accept your amendment. You're probably right. Not because it's a bad amendment. I think it's a great amendment. But I think that,
that I think
the way the bill is structured provides an opportunity not just for Lake Street Council, but also for lisc, for African African Development Corporation, for any other cdfi. They all have an opportunity to really make sure that they're able to be responsive to their businesses. So it's no slight to Lake Street Council or Russ Adams. Thank you so much, Russ for being here. I sincerely appreciate his support for coming in for sitting in this chair. But the last thing I'll say, I always have an open door policy. People can come and talk to me, give us ideas. We believe in building together. And so I would hope that the committee for the motion that has been put forward, I would hope that you would not support that
motion.
And I think that Senator Powell should be able to speak to that question. Thank you, Madam Chair.
Before we move the amendment, I will say the amendment I was going to have did not come from Lake Street Council. So I want to make that. I'm working on a bill with them, but it didn't come from them. You did name Russ. He did not speak to me. He does not even know about this amendment. So I'd like to be honest about that conversation. It's an amendment I wrote after I saw the bill with an understanding that it does not include communities that actually I have been speaking to over this last year and after hearing from, after sitting through our economic impacts on Metro Search few weeks ago with an understanding of sitting there and saying, wow, there are communities that were directly impacted businesses that I know that shut down from our own community that were not invited to this, you might have put out a calling, but it just, they weren't there. And I think it's important for us to hear from them. I think my motion says the money should go directly to support businesses. I think we have an understanding of what the impacts of Metro Search are. There are hundreds of million dollars just in Minneapolis. The mayor said it himself. Mayor Nadia said it for Salem Spark. And I think this money could be going to go support safe couple businesses instead of understanding what the studying what that is because when it comes to other communities we don't study their needs.
So I just Senator Muhammad, are you making the motion or are we or are you offering the amendment?
I have no I'm making a motion to move section two, the analysis of impacts the $250,000 that goes to study to conduct compress comprehensive study analysis.
Okay. Thank you Senator Muhammad. I'm guessing that's more of an oral amendment. If we could have counsel and Ms. Fontaine from council maybe walk us through that a little bit.
Yes. Madam Chair members and Senator Mohamed's amendment I believe what she would like is on page one, line six after account insert and $250,000 in fiscal year 2027 is appropriated from the general fund and then delete section two.
Senator Muhammad, does that sound accurate to you?
Yes,
Senator Pa. To this amendment.
Okay.
Senator Pa thank you. Chair. I just want to say that this is actually something I've been talking to Chair Champion and have been talking in this committee about quite a bit. As you get to remember, we have a lot of our community members who have come to us and said we need to have an understanding of what the real impacts have been, especially the nonprofits and the businesses who I would say the nonprofits who also do work with the businesses in order for them to be able to have an understanding of what the impact has been in the businesses here. It's hard for them to be able to do much work with them, especially when it comes to applying for grants to be able to work with our small businesses. We have no information, no data from what has happened. The good thing is that the city of Minneapolis did do a study, but it's very specific to Minneapolis Explore Minnesota did do a study but it's very specific to only hospitality businesses. I know I've been talking to the Mung Chamber and they're currently working on a study of specifically only basic small their membership and Hmong based businesses to try and get an understanding of the impact there. But we need a statewide analysis of what the real impacts are when it comes to how many businesses were impacted. What are the dollar amounts so we can really truly look at that information and say to what Magnitude. Do we have to show up to be able to support all the businesses that were impacted? I think I have an idea. I'll just tell you that I'm sure my ideas are completely inaccurate. The reason why I say that is based on just the small amount of things that I see. It is not based on what really is out there. And this is why this analysis is so much needed, not just for this year, but really for today, ongoing for the next couple of years. To Senator Champion's point that we still have a lot of work to do. And without proper information, we don't know how to do that work to make sure that we are truly meeting the needs of our businesses. So I would be against that amendment,
Madam Chair. I'll ask for a roll call.
Senator Muhammad asked for a roll call.
Roll call requested.
Roll call granted. Senator Champion, any. Well, sorry. Any other members? Senator Housley.
Thank you, Madam Chair. And Senator Champion, I'm just wondering where you got the $250,000 to do the study. Where did that number come from? It just seems a little high.
Senator Champion.
Thank you, Madam Chair. And thank you to Senator Housley. It was from talking to Deed and other people who do this sort of thing. And that's where I got the number from. If the number is too high, if we receive some additional information between now and and finance, we'll be happy to modify it.
Members of Senator Pratt.
Thank you, Madam Chair.
Well, we've spent a lot of time on this and I'm just going to bring up what I brought up last time. You know, we want to talk about the impact of Metro surge, but yet we've failed to look at the economic impact of the fraud that's hit this state. And it's by far even more. I'm going to support Senator Muhammad's motion because I don't think the current study goes far enough. And it's an expensive study, way more expensive than I think we've seen for something that's this targeted. So thank you,
members. Anyone else? Oh, Senator Herr.
Madam Chair. I'm just aware of this, too, and also just aware of the Lake street and so it'll be a decision to make very quickly here. Madam Chair, and all respect to Senator Muhammad Chair. You repeat what Senator Muhammad motion is. Is that no more study as according to this plan, or is it still a consideration of study? If we move this, there's no more study. Am I correct, Ms. Fontaine?
Madam Chair. Members. Senator Hurt. Yes. The amendment, the oral amendment would delete section two, which would remove the whole analysis study and that funding and then the $250,000 in general fund would go toward the loan program. If you want me to repeat the motion, but that's the general gist of the Amen.
Senator hur, is a 250 be added to the rest of the money.
Okay.
Ms. Fontaine.
Yes, madam Chair. Members and Senator, yes, it would be added to the 100 million, but it would be general fund versus forward fund.
Senator, I can I ask a question to San Champion? I, I don't want to put Sen. Champion on the spot here, but with Sarah Muhammad, I don't see her amendment yet. I mean not this oral amendment, but the larger Amendment on East 7th street is something that we may discuss on Wednesday.
Senator Champion, Mr. Chair, Madam Chair, Senator Her, Senator Hur, this bill we are planning, my hope is for us to move it out and move it to finance. Right. And the bill that Senator Pa talked about is laid over for a possible inclusion. What is before you is just whether you want to move the $250,000 for the study that Senator Pa and others have talked about or if you want to use it for small businesses.
Senator, her
my decision is yet to come, but I just want to state something in the light of supporting Senapa here. You know, even on her last bill, reference to Culture Mall. And I think I was the one that fought hard when the Culture Mall was coming around, the one who identified that term until I come out with the word Culture Mall. And having research will get people to understand that process. There's so many layer of operation in the Culture Mall. So I'm speaking in support of Senator Pop and we'll see when this roll
call,
when the roll call take place, what my decision will be. But having a study I think will be important. Even our Culture Mall itself, we are not effectively supporting the mom and Pop's vendor within the the Culture Mall on Lake street or Culture Mall in Duluth. They're very different. Culture Mall, they operate differently. And I certainly want those mom and pop to have the funding instead of sometime going to the landlord who may be more knowledgeable of applying the grant. But this is just a one person perspective and I think, you know, from my end, the study's needed, but we'll see when the roll call takes place.
Thank you, Senator Hurst. Senator Champion, final thoughts before we do go to roll call on the amendment?
No, this is something the committee and Senator Pai and others have talked about. That's why it's there. And I won't, I will support the study and whatever the committee wants to do, I hope that they understand the importance of it. Thank you.
All right, roll call. Senator Champion.
No.
Vice Chair Muhammad.
Yes.
Senator draheim.
Yes.
Senator gustafson. No. Senator her.
No.
Senator housley.
Yes.
Senator pratt.
Yes.
Senator nelson.
Yes.
Senator pa. No. Hold on. Stand by for math. All right. With five yeses and four nos, the amendment passes. Now to the underlying bill. Senator Draheim.
Thank you, Chair. Thank you, Senator Champion, for bringing the bill forward. And I think we've had a great discussion about a very important topic. This is $100 million. It's a lot of money. I could go on for probably another hour, Senator Champion, on questions I have on this bill, but I do think it needs some work and I think there's a lot of questions the committee still has. So I would like to make a motion to lay Senate File 4535 on the table and for us to get to Senator Arrest bill. I know she has testifiers also here. And we are about 20 minutes past our normal time, so. And we can pick this up on Wednesday. Chair. If it's just going to finance, I think we could squeeze it in later. So that is my motion to lay this on the table.
All right, we're going to do a roll call motion to lay the bill on the table. Senator Champion.
No.
Vice Chair Muhammad.
Yes.
Senator Draheim.
Yes.
Senator Gustafson. No. Senator Hur.
No.
Senator Housley.
Yes.
Senator Pratt.
Yes.
Senator Nelson.
Yes.
Senator Pa. No. Standby.
Mass.
The Motion stands at 5. No, sorry. 4.
No.
5. Yes. The bill will be laid over and.
And, members, just so you know that we would not have another bill that comes up. This would be. So you blame this. Thank you, members. And thank you, Senator Gustafson. Thank you for sharing for that portion. Members, just so you know that we would not bring up another economic rec. Recovery bill. That will be it. And I hope that you all had a chance to record and hear exactly what happened. Just so folks know, on. Wednesday we will. Right now we have an omnibus bill that we are bringing up, but we'll probably scratch that from the list of as well. With that being said, thank you. So. Oh, send a rest. I'm sorry. I'm sorry. I didn't want to.
Sorry.
S. Come on over. Okay. And we do have one testifier that will be virtual it. Senator. Rest. And so for the audience's purpose as well, this will be our last hearing. We are not going to have any additional hearings after today. Senator Arrest.
Thank you. Thank you, Mr. Chairman, Senate File 3977 is a bill that will bring a lot of energy into Minnesota's economy.
Senator Russ, will you speak a little more to the mic there, please?
Sure.
Sorry.
Thank you.
Senate filed 3977 and it's a bill that will bring a lot of energy into Minnesota's economy. What it does is just one section. It appropriates $7 million in fiscal 2027 for a grant to the city of Chaska in support of costs that are associated with hosting some extremely significant in the sporting world events of the PGA. We know that the 29 Ryder cup is coming back to Minnesota. It's very unusual for that to happen. There's been no other golf course in the country that has been able to host two Ryder Cups. And the only one that is scheduled now is at Hazeltine. We know that in order to make money, sometimes you have to spend money. And that is the basic premise of this bill. And I'm not going to take any more time from the committee, Mr. Chairman, but I would really love for you to hear some comments from the testifiers.
Thank you, Senator Rhess, who will go first? Mr. Dunnick, how about you go first?
Thank you, sir. Thank you, Mr.
Chair.
Members of the committee, Adam Dunnick. I'm the President CEO of the Minneapolis Downtown Council represent about 400 businesses large and small and community partners are commercial committed to a prosperous downtown Minneapolis. Our downtown has remained strong in event attendance over the last three years eclipsing over 9 million sports attendees. Music, culture, nightlife. These events fill hotels. They fill restaurants, bars and small businesses who rely on tourism that bring people into our region. That is exactly why the Minneapolis Downtown Council is supporting the efforts of PGA of America and Hazeltine. They are proven partners that project to raise over 600 million million in economic impact just from the Ryder cup alone in 2029. We have some history too with them. In 2016, we hosted the Ryder cup drawing over 250,000 visitors. And significant amounts of tourism that we know from experiences benefit both downtown and the rest of the region. Just last week, the Minnesota Sports Facilities Authority released a study of economic impact of the U.S. bank Stadium over eight years. 26% of the visitors coming to U.S. bank contributed over $1.3 billion to our state's economy. For every tourist that attended event like they host there, which is going to be similar to the event at Hazeltine. Over $300 were spent on food, lodging and other activities. This study was timely and shows the efforts of Meet Minneapolis Minnesota Sports and events and other Partners of ours who work to attract these large scale events to our state. The game of golf is growing exponentially. We have an opportunity to attract international tourists, support our regional reputation and our businesses and hospitality sector. And that's why I'm proud to speak in favor of Senate file 3977. Thanks, Madam Chair, Mr. Chair. And thanks, Senator.
Rest.
Thank you so very much. To the next testifier, please identify yourself for the record and let's go forward.
Thank you so much. Good afternoon. I'm Dan o', Neill, Vice President of strategy and Sales for the Bloomington, Minnesota Travel and Tourism. I've had extensive experience securing and working on many large scale mega events benefiting the hospitality community and surrounding area destinations. Bloomington is known as the City of Hospitality. It's our largest industry with over 20,000 employees. For those that don't know the Ryder cup, it reaches a half a billion homes in nearly 200 countries. Televised on NBC, the Ryder cup is the largest event in golf. It's always been a top five global all time sporting event with many special events surrounding the Ryder Cup. Galas, ceremonies, parties, spectator and PGA hotel blocks which include lodging, transportation, food and beverage, retail at the Mall of America, recreation at our state golf courses. The ROI is substantial. The international reach is extensive. In 2016, our Ryder cup website averaged 14,000 visits per month. Over 270,000 registrations from 115 unique countries. We had a meaningful partnership with many of the communities. Explore Minnesota tourism and all the upstate destinations experiencing our golf courses, which is tremendous for Minnesota. The power of mega events and the Ryder cup has on the frontline hospitality employees. I'd like to give an example of Jess, a bartender in server at Smack Shack Bloomington. She's a single mom with a one year old and works many shifts as possible, including double shifts to support herself and child. She looks forward to the shifts that occur when there are events happening in Bloomington and surrounding the area. Events are very important for hospitality businesses and their staff. From our van drivers to housekeeping to dishwashers and all the frontline employees like Jess.
Sir, thank you so very much. You only had two minutes and if you want to give us one last sentence, that would be great.
Absolutely. Right now we're at a very critical point. The power of the mega events are getting competitive and costly. Other states are financially supporting the PGA because they realize how valuable economically they are to communities. And sports is a unifier to communities. And so I thank you and I hope that you will and urge you to pass this important legislation. Thank you.
Thank you. So very much. I sincerely appreciate it. To the next testifier, state your name for the record and give us your two minutes of testimony.
My name is Matt Paderowski. I'm the city administrator for the city of Chaska. I've actually been in Chaska since 2001. So I've seen a couple of PGA Championships, two U.S. amateurs, Ryder Cup, Women's PGA Championship. We have another Women's PGA Championship this year, and then we have the Ryder cup coming up. So. So we've seen a lot of events. My testimony will be a little bit different than those two. We certainly take a ton of pride in what happens in our community, but we don't see the economic benefit of seeing these events in our community. In fact, people get bused into our community, go to the golf course, get on a bus, and go back out. In fact, we have expenses that go along with the actual running of the tournament. So we have about between 2 and $300,000 of expenses that go into public safety, public works, our fire services, those types of things that we're responsible for at the course. We love to do it, but we would make the argument that, you know, we're providing a regional benefit as part of this and not just a benefit to our city to be able to attract this, this type of event. And a bill like this would really help to regionalize some of that expense so that we wouldn't bear that just on our own. And we do know, working with Hazeltine and with the pga, that getting these events has become much more difficult over the last few years that they expect that there's going to be more assistance to be able to attract those. And a bill like this would help us stay competitive in attracting these things that really do put us, you know, really on the map as we talk to different companies in economic development deals across the country. So we are very supportive of this bill.
Thank you so very much for it. We are now going to virtually. We're going to go to Phil Anderson. Phil, welcome. State your name for the record and give us your testimony. So good to see you again.
Nice to see you. Thank you, Mr.
Chair.
Appreciate this. Thank you, Senator Rust, appreciate everyone's time today. My name is Phil Anderson. I'm the general manager at Hasting National Golf Club. I also serve on the national board of directors with the PGA America. I thank you for certainly hearing this bill beyond the economic impact we've already secured in our hosting, certainly 2026 this summer, the women's PGA and have the 29 Ryder cup coming back which is going to be an incredible honor. But what today's about is certainly fulfilling the promises, certainly from the past, from Governor Dayton and others, letting the PGA know that we were going to be here to support them if they were willing to bring a second Ryder cup back. In addition to that, this is about the future and having, again, three more events that we could add to our lineup and continue to support the PGA America for the significant economic impact that would be coming to the state of Minnesota we were so proud in 2016 to host. The economic impact was $135 million. But what I'm here to tell you today is that the event continues to grow. We had an independent study down at Columbia University that just measured the 2025 Ryder cup, and that came back at $622 million of benefit to the State of New York. We want to be certainly hosting these next three events, but we also want to continue this relationship well into the future and try to keep ourselves in the dialogue for certainly having a third Ryder Cup. We appreciate everyone's thoughts around this, but this is an incredible investment. Not only does it create significant economic impact to the general fund, but it also creates incredible imagery and positive messaging out to the entire world, as all of these are international events that we're hosting. Appreciate everyone's time. Thank you, Mr.
Chair.
Thank you so very much. I appreciate you being here. We're now going to go to Matt. Oh, we got him already. And we got Adam already. All right, listen, I am being much more fluid.
Thank you, Mr. Chairman, than what I thought.
So thank you so very much. Any questions? Senator Housley?
Thank you, Mr.
Chair.
And thank you, Senator Rust, for bringing this bill. Mr. Chair, I know, you know, I love hockey. And we did the $10 million for the world Juniors Championship, and it was a huge success. It was a $72 million impact to the Twin Cities, and so that was great. And then we also did the US gymnastics trial, and that was a 5 million dollar investment from the state, which was like another $73 million economic impact. But this would bring three events, three events to the Twin Cities. And golf is my second favorite sport. So I think it's really tough. It's really tough for Minnesota to get these big events to come here because we don't have a revenue source for this kind of. And so it always comes to you, and we always have to, you know, pitch our case to you, Senator, Champion or Mr.
Chair.
But a $7 million investment to the PGA for these events, I think would have 250 million dollar impact that would be great for the state of Minnesota. So thank you, Mr. Chair. And thank you, Senator Rest and all the testifiers.
Thank you for those comments. And I know that hockey is your first love. Now. I know golf is your second love. And then the next thing she likes is going to be her third love. I know. Just messing with wwe. I understand it. Any other questions for the testifiers before we lay the bill on the table? Senator Russ, thank you for your patience today. We wanted things to go much more smoothly today, but you know what? We're in the Senate. But guess what? This will be our last hearing. So with that being said, we are adjourned.
Sam.