Hutchinson has almost 50 restaurants, 20 hair salons and numerous massage therapy practices and athletic facilities. In the midst of Minnesota's COVID-19 response, they and many other businesses are facing hardships.
An executive order from Gov. Tim Walz this past week called for restaurants and recreation and exercise facilities to close their doors. Other businesses made changes or ceased operations to promote social distancing, but such moves come with an economic toll. Another order announced Monday aims to provide relief.
"Federal loan programs don't move fast enough," Walz said in a press conference Monday.
He directed the Minnesota Department of Employment and Economic Development to create an emergency loan program to help Minnesota small business owners bridge the gap. The order makes available $30 million from special revenue funds. These dollars will be used by DEED’s lender network to provide between $2,500 and $35,000 for qualifying small businesses. The loans will be 50 percent forgivable and offered at a 0 percent interest rate. If other financing becomes available to small businesses that received an emergency loan, such as federal funding, the emergency loan must be repaid.
"This is a big help to people," said Mary Hodson, president of the Hutchinson Area Chamber of Commerce and Tourism.
"I think the need is going to be pretty significant," said Miles Seppelt, Hutchinson's economic development director. "With beauty salons, fitness locations and restaurants, it gets to be quite a high number pretty quick."
DEED loans are expected to be available by the end of the week. There are numerous ways local businesses can find more information:
- Questions about the DEED emergency loan program can be directed to ELP@state.mn.us. Find more information and an application at tinyurl.com/ulaadqg.
- Learn more about the SBA loans at tinyurl.com/vtbr6u8.
- The Chamber is maintaining a list of business resources at tinyurl.com/uucmyp6.
- The Chamber also has a list of business changes at tinyurl.com/va4hsgk.
- The Hutchinson Economic Development Authority has a list of business resources at hutchinsoneda.com/covid-19/.
Many businesses can already apply for disaster loan funds administered through the Small Business Administration. Small and mid-sized businesses can apply to the SBA for loans of up to 30 years with 3.75 percent interest rates. For nonprofits, the rate is 2.75 percent. But, as Walz said, the process may take awhile.
"It's going to take some time to get processed," Hodson said. "(The DEED loan) helps them be able to get money quicker to keep people working or keep businesses afloat until those (federal) government funds come."