Redevelopment Grant and Demolition Loan Programs

The Redevelopment Grant and Demolition Loan Programs are administered by the Minnesota Department of Employment and Economic Development through its Brownfields and Redevelopment Unit. These programs are designed to support local governments in addressing barriers to redevelopment caused by blighted, contaminated, or underutilized properties. By targeting previously developed sites that present financial or structural challenges, the programs aim to stimulate economic development, improve public safety, and promote community revitalization across the state. The initiative reflects a broader state policy commitment to equitable development, geographic distribution of resources, and measurable public benefit outcomes. The Redevelopment Grant Program specifically focuses on closing financial gaps that prevent redevelopment of sites with existing infrastructure or structural deficiencies. These sites are often more costly to redevelop than undeveloped land due to contamination, obsolete structures, or inadequate infrastructure. The program is intended to assist new redevelopment efforts rather than long-term site operators, and it requires that a committed developer and a clear redevelopment plan be in place. Eligible projects must result in a more productive use of the property and demonstrate alignment with statutory criteria emphasizing economic and community benefits. The Demolition Loan Program complements the grant program by addressing properties where redevelopment is not yet imminent but is hindered by unsafe or blighted structures. This program provides financing to local development authorities for the acquisition and removal of hazardous buildings that have been vacant for at least one year and pose public safety risks. The expectation is that demolition will enable future redevelopment opportunities and generate long-term economic benefits such as job creation and increased tax revenue. Loans are structured with defined repayment terms, including a maximum term of fifteen years and a two percent interest rate, with deferred interest accrual during the first two years. Funding for these programs is approximately two million dollars in total, with individual demolition loans capped at one million dollars. The Redevelopment Grant Program requires a local match of at least fifty percent of eligible project costs, which can be sourced from any available municipal funding streams. Funds must be used for eligible redevelopment or demolition activities and are reimbursed based on documented expenditures. Recipients must maintain detailed financial records, comply with state procurement and prevailing wage laws when applicable, and submit annual reports documenting project progress and financial performance. Eligibility is limited to public entities including cities, counties, housing and redevelopment authorities, economic development authorities, and port authorities. Additional criteria apply depending on the program. For redevelopment grants, sites must have been previously developed and must not be undeveloped land. For demolition loans, the applicant must own the property, and the structures must meet specific conditions related to vacancy, safety risk, and historic designation status. All applicants must undergo a financial and capacity review for awards exceeding fifty thousand dollars and certify compliance with state requirements regarding financial integrity and organizational capacity. The application process is structured and requires submission of three complete application sets, including one paper copy and two electronic copies on separate flash drives. Applications must be physically delivered by the deadline and cannot be submitted electronically. Required components include application forms, supporting documentation, and resolutions approved by the governing body of the applicant agency and municipality. Applications are evaluated competitively based on statutory criteria, including public benefit relative to cost, redevelopment potential, and alignment with program priorities. Final award decisions are made by the DEED Commissioner following review and scoring by the Brownfields and Redevelopment Unit. The application deadline for the current cycle is August 3, 2026 at 4:00 p.m., and funding announcements are expected approximately eight weeks after submission. The program operates on a recurring basis, with periodic funding rounds. Technical assistance is available through the Brownfields and Redevelopment Unit, and informational workshops are offered to guide applicants through the process. Overall, the programs provide a structured and strategic funding mechanism to transform underutilized properties into productive assets that contribute to community development and economic growth.

Emphasize measurable public benefits and redevelopment impact; ensure complete documentation and compliance with submission format; secure governing body approval early; align project with statutory scoring criteria