Relief coming for businesses hurt in 2020 civil unrest

Many months after civil unrest and the COVID-19 pandemic upended St. Paul retail districts, more relief is on the way. Whether it will still benefit businesses damaged or destroyed in 2020 remains to be seen.
A total of $1 million, split between two city programs, will be rolled over from the 2021 to the 2022 budget. Funding guidelines will be released during the first quarter of 2022.
The St. Paul City Council, acting as the Housing and Redevelopment Authority (HRA) on Dec. 9, unanimously approved the reallocation. Council members asked why it took so long, when other nonprofit relief efforts tied to civil unrest and the pandemic have wound down. Many affected Midway businesses have already rebuilt, relocated or opted not to reopen.
“The intent at the time was to provide immediate assistance to businesses,” said Ward 2 Council Member Rebecca Noecker. “We allocated these funds some time ago and the idea was to help businesses that were really struggling … I’m just wondering why it has taken so long to get the dollars allocated.”
Noecker also expressed concern about the lack of information, adding that “communication has been somewhat lacking.”
Andy Hestness, HRA program director, said the delay was caused by waiting for the Minnesota Legislature to act on funding. “It took longer than we would have liked,” he said.
State lawmakers approved a package of finance assistance as the 2021 regular session wound down. The Minnesota Department of Employment and Economic Development (DEED) announced the first round of Minnesota Main Street Economic Revitalization Program grants in October 2021, including an award of $8.9 million to the St. Paul and Minnesota Foundation for three districts within the city.
The HRA also allocated $500,000 to the Local Initiatives Support Corporation (LISC) Community Assets Transition Fund, and gave approval for an agreement for the dollars granted to LISC. This program will help small Black, Indigenous, people of color (BIPOC)-owned businesses that are in danger of losing their storefronts to property sales. Properties could be sold to nonprofits and held until the business owners ae able to buy and own their places of business.
Another action reduces the city’s early notification system process for requests for $250,000 or more, from 45 days to 10 days. That is meant to get funds out the door more quickly, said Hestness.

City’s $500,000
One allocation provides $500,000 to provide matches for $8.9 million in state dollars in three designated neighborhoods or be used citywide. The designated neighborhoods include sections of Snelling and University avenues and Rice Street, West Seventh Street and parts of the East Side.
The local streets included are Snelling between Portland and Englewood avenues; University between Fairview Avenue and Rice Street, and Rice Street between University and Larpenteur avenues.
The districts could include projects within one-quarter mile of designated streets. “These corridors represent some of the areas hardest hit by the civil uprising and where the need for capital project funding is greatest,” said a city staff report.
The state funds are for businesses impacted by widespread arson and civil unrest, natural disasters, the pandemic and major plant closures, significant commercial vacancy increases, and/or loss of economic anchor institutions. The $8.9 million is overseen by the foundations.
Eligible expenses include repair or renovation of real property, building construction, landscaping and streetscaping, demolition and site preparation, predesign and design, engineering, infrastructure and related site amenities.

LISC’s $500,000
The $500,000 for LISC is part of a proposed, $25 million-plus flexible, affordable pool of capital that that can be used to acquire commercial and residential properties in or near the districts that were impacted by the civil uprising following the May 2020 murder of George Floyd and the economic fallout of the COVID-19 pandemic. The fund would help with property acquisition as well as with technical, predevelopment, and capacity supports to prospective developers and long-term owners to help them prepare for development and sustainable property ownership.
Council Member Mitra Jalali expressed interest in the LISC funding, saying there are businesses in her fourth ward that could benefit. Business owners are worried about property sales and gentrification pushing them out.
“We have a number of businesses in the Midway that are BIPOC-owned businesses,” she said. These longtime business owners don’t own their storefronts and risk eviction when properties are sold.
The fund was set up to help with acquisition of commercial and residential properties in or near the districts that were impacted by civil unrest and the pandemic. The maximum investment per project is $250,000, with loan terms of five years or less. Loan rate is zero percent.
The funds could only be used for property acquisition, with community-based nonprofit organizations as borrowers.