Community Planning & Economic Development
What is the Two Percent Loan Program?
Two-Percent Loans provide financing to small Minneapolis businesses (retail, service or light manufacturing) to purchase equipment and/or to make building improvements. A private lender provides half the loan at market rate and the City provides the rest, up to $50,000 at 2 percent interest (up to $75,000 in designated neighborhood commercial districts). The loan term is set by the private lender and can be for up to 10 years. Bank fees vary, but the City charges a 1 percent origination fee with a minimum of $150 due at closing.
Terms and Conditions
- Applicant must repay the loan and be an acceptable credit risk
- Use contractors licensed in Minneapolis
- Meet Minneapolis city codes for all rehab work or equipment installations
- Comply with Minneapolis zoning ordinances
- Make efforts to hire Minneapolis residents through cooperation with the CPED Workforce Coordinator, the Minneapolis Employment and Training Network as well as JobLink.
- Not use funds for billboard advertising.
- The City cannot finance any work started prior to the loan
Who is Eligible
- All businesses located in the City of Minneapolis
- The applicant may be individual owners, partnerships, corporations, tenant operators or contract for deed partners.
- Businesses that benefit low-to-moderate income persons by creating jobs or improving services
- Walls, ceilings, floors
- Mechanical Systems and Air Conditioning
- All work on the front and sides of business buildings facing public streets
- Cleaning, painting and staining of exterior surfaces
- Masonry repairs
- Repairing or replacing of cornices, entrances, doors, windows, decorative details and awnings
- Sign removal, repairing or replacement
- Architectural design services for plans and specifications
- Parking lots, including lighting, surfacing and landscaping
- Building identification
- Other items that are viewed necessary to complement the exterior of the building
- Building permits
- Energy audits
- Energy conservation and energy retrofits
- Handicap access
- Streetscape costs not financed by special assessment
- Production equipment
- Equipment must be fixed
- Financing of computers are approved on a case-by-case basis
How to Apply
Complete an online application here, or to request a printed application please call (612) 673-5072.
All programs and guidelines are subject to change without notice.
Online information from the City of Minneapolis at MinneapolisMN.gov/CPED
Last updated Feb 22, 2019