Minneapolis proposes $7m small business fund

Minneapolis city leaders are moving to establish a $7 million relief fund to support small and medium-sized enterprises facing severe revenue losses linked to a federal immigration operation.

The Minneapolis City Council is scheduled to vote on the proposal on Thursday after its Committee of the Whole advanced the measure in an 11-2 vote. The fund was initially set at $5 million but was amended to $7 million during committee discussions. Council member Jason Chavez said businesses across the city, particularly shops and restaurants, have been “impacted drastically” and require immediate support.

A city report released last week estimated that restaurants and small businesses lost approximately $81 million in revenue in January alone. The proposed relief would be drawn from a municipal fund originally earmarked for downtown infrastructure and maintenance costs. If approved, the city’s Community Planning and Economic Development office would administer the programme and accept applications from affected businesses.

Owners at Mercado Central, a predominantly Latino business cooperative on Lake Street, reported sales declines of around 90%. Some enterprises have closed temporarily, while workers and customers have stayed away amid concerns related to immigration enforcement. Business owners cited immediate pressures such as rent and payroll obligations, alongside longer-term concerns about preserving intergenerational family wealth and maintaining the area’s role as a cultural and community hub.

State and local leaders have drawn comparisons to the early stages of the COVID-19 pandemic, when federal aid programmes provided liquidity to struggling enterprises. Minnesota Governor Tim Walz has proposed a separate $10 million state-level package, though council members argued that sum may be insufficient and that state funds could take months to reach businesses.

If the council approves the city measure, it will go to Mayor Jacob Frey for signature or veto. Frey has cautioned against extensive drawdowns of city resources, warning that sustained spending could lead to higher property taxes or cuts to core services.