ST. PAUL — Minnesotans out of work will see a 13-week extension to their unemployment benefits and bars, restaurants, gyms, theaters and other hospitality businesses that faced the toughest blows from the pandemic could see support payments by the end of the month.
Both chambers of the Minnesota Legislature on Monday, Dec. 14, approved a $242 million plan to move the money to business owners and people out of work. Gov. Tim Walz applauded the legislation Tuesday morning and was expected to sign it into law Wednesday.
More than 100,000 Minnesotans currently collecting unemployment expected to see their benefits run out Dec. 26 without state intervention. They'll now be covered through April. And business owners still shut down or strictly limited due to state executive orders will be eligible for grant payments to help cover their costs.
Legislators on Monday said the funding isn't enough to make up for losses Minnesotans have faced this year and they urged federal officials to move quickly on another set of support payments. Local businesses, meanwhile, said they appreciated the payments but still faced painful financial decisions amid the pandemic.
Before the money flows out to workers and business owners around the state, here's a look at what's in the plan and what comes next.
What's in the proposal?
The total of $242 million breaks down like this:
$88 million will pass through the Minnesota Department of Revenue to be used for payments to restaurants, bars, bowling alleys and gyms. The department will issue grants to businesses that have faced at least a 30% loss in the second and third quarter of 2020 compared to the year prior.
Businesses wouldn't have to apply for these grants. Instead, the department would determine whether they meet the criteria and send out a check based on the size of their business assuming they are in good standing.
$14 million will move to the Department of Employment and Economic Development to be sent out as grants to movie theaters and large convention centers based on their number of screens or size. Those venues, not including drive-in theaters, would be eligible for funding if they saw a 30% decline in revenue compared to 2019.
The remaining $114.8 million will be issued to counties to distribute locally to hotels, museums, arcades and live theater venues that might not fit other criteria. Counties will receive between $250,000 for the smallest counties and $25.5 million for Hennepin County, the state's most populous, to deploy to businesses as they see fit.
The extension of unemployment insurance benefits will cost nearly $500 million from the state's Unemployment Insurance Trust Fund and are estimated to cover more than 100,000 Minnesotans out of work. And federal approval of additional unemployment insurance benefits could help compound benefits.
Bars and restaurants will also see regulatory fees waived to the tune of $900,000 under the plan. Fees for caterers that serve alcohol and businesses that serve booze until 2 a.m. will be waived since most have been unable to use them this year. Small breweries will also see refunds from the Met Council for wastewater treatment fee refunds and the Department of Agriculture will waive late payment penalties for wholesalers, food manufacturers and retailers.
Minnesota school districts will also receive an 11-month extension to assess how many students apply for free and reduced-price meals. The widespread push to virtual learning has made those totals harder to calculate.
When will the funds reach Minnesotans?
Lawmakers said they expect the funds could reach affected businesses later this month, though funds from counties could take longer to roll out as county leaders will have to assess the need in their communities before distributing grants.
Will the feds step in with more support?
Congressional leaders and President Donald Trump remain in negotiations about another set of stimulus payments. They face a deadline at the end of this week to reach an agreement or face a government shutdown.
The state legislation will prevent Minnesotans from seeing unemployment benefits run out next week but without intervention, the moratorium on evictions and federal paid family leave programs could lapse. And protections for student borrowers could run out.
There was a bipartisan call Monday for federal lawmakers to quickly pass a package before the holidays.
"We are on the way, we've got relief coming. It's not enough, it's only to give you life support until the next round comes," Rep. Dave Baker, R-Willmar, said during floor comments Monday night directed at business owners. Baker helped write the compromise bill. "And hopefully our federal partners will be there for us, but businesses, we're finally on our way."
And Walz said Congress should pass a slimmer package to help tide over workers, business owners and families through the new year.
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