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I I I I I I I I I I I I I I I I I Minnesota Fund Loans Approved The Department of Energy and Economic Development recently approved Minnesota Fund loans to several businesses This direct-loan program provides fixed-interest rate, fixed asset financing to new and existing businesses for expansion The goal of this program is to create jobs and stimulate private sector investment by providng assistance for small business expansions. The maximum loan amount is $250,000, or no more than 2()o~ of the total fixed asset project costs, and small businesses which are for-profit corporations, partnerships or proprietorships; independently owned and operated; and not dominant in their field may qualify for the program The Minnesota Energy and Economic Development Authority, which was created by Governor Perpich and the 1983 Minnesota Legislature, recently approved loans to the following businesses -MHC., Inc., a new company expected to rehire 88 former Glenwood Corporation employees, received final approval for a $250,000 loan. MHC., owned by Lague Enterprises of Minneapolis, will use the loan and private financing to purchase Glenwood Corporation's real estate, machinery, and equipment. The company will resume the fabrication of material handing components, rehiring 62 employees this year and 26 more employees next year. -Up North Plastics, Inc. received final approval for a $250,000 loan. The loan, part of a $4.2 million financing package, will assist Up North to purchase the vacant Whirlpool complex in Cottage Grove. Up North is a manufacturer of plastic film for agriculture and construction businesses. The company will use the 200,000 square foot building to increase warehouse space and begin the production of films for other markets, including the high technology and biotech- nology markets. The company will add 47 new employees to its current workforce of 35. -Advertising Unlimited, Inc., voted 68th outstanding small business in America by Forbes magazine, received final approval for a $1 million loan. The company will use the funds to help finance a $2.7 million expansion, including the construction of a 60,000 square foot addition to their existing Sleepy Eye plant. Already Sleepy Eye's largest employer, Advertising Unlimited will add more than 100 full-time jobs to its workforce over the next two years as a result of the expansion. -Crysteel Manufacturing, Inc., the largest industrial employer in the Lake Crystal area, received final approval for a $1 million loan. The loan will be used to finance a $1.84 million expansion, increasing Crysteel's employment from 95 to 145 full-time jobs over the next two years. Combined with local tax increment financing and private financing, the loan will assist the company to construct and equip a 48,000 square foot building adjacent to the company's existing facility on Highway 60. -Lake wood Industries, a start-up company expected to create 76 jobs in the next two years, received final approval for a $250,000 loan. The new company will utilize poplar wood from the local area to manufacture chopsticks for export to the Far East. According to market studies, Japan alone consumes more than 50 million disposable chopsticks per day, and Lakewood has signed letters of intent from Japanese companies to purchase the chopsticks. Minnesota Fund, continued on page 2 I I Minnesota's Economy More Like the Nation; Dual Economy Persists Minnesota's industrial mix is shaping the state's economy more like that of the nation's Since 1950, the state's manufacturing job growth has been three times the national rate, so that the share of Minnesota jobs in manufacturing now approximates the nation These are just two conclusions of a new study entitled "Snapshot of the Minnesota Economy," a 95-page report released by the Policy Analysis Division of the Minnesota Department of Energy and Economic Development. Development economist Brian Zucker authored the report. The report also provides further evidence that the Twin Cities and Rochester areas are continuing to experience relatively strong economic growth while a large portion of the state suffers from the agriculture crisis and the decline in mining. "Minnesota's economy is becoming more diverse and not as reliant on a few key industries," said Lee Munnich, assistant commissioner of Policy Analysis. "However, it's a two-way street because at the same time we must bear the brunt of national economic cycles and trends that affect us adversely. High federal deficits and an inflated dollar affect Minnesota's economic future whether we like it or not," said Munnich Minnesota's most serious economic problem cited in the report is the emergence of a dual economy. "The primary focus of state government right now should be on how to deal with the rural crisis and the economic disparities it is causing between rural and metro areas," said Munnich. In the report Zucker cites nine factors which influence Minnesota's economic performance. 1. Spatial isolation Minnesota's metropolitan economy, located several hundred miles north of major shipping routes, has influenced Minnesota's market orientation. Most of the industrial goods currently produced by Minnesota manufacturers are technologically intensive with high value-to-weight ratios. Minnesota ships more computers, scientific instruments, and industrial machinery outside its borders than most states. About 20 percent of such high value products go to foreign markets. 2. Highly concentrated metropolitan population More new investment is occurring in the Twin Cities and Rochester relative to the rest of the state. While the disparity in investment opportunities is not responsible for the MN Economy, continued on page 4 Community Development Guidebook Available Published by the National Association of Towns and Townships, A Small Town Guide to Community Development Block Grants and Other Federal Programs, is designed to help officials and local lenders with small budgets, and small staffs develop competitive applications for federal programs. The book focuses on five key areas that make for a well-documented, well planned, and affordable grant proposal: planning, eligibility, affordability, funding, and management. Included in the guidebook are worksheets and agency contacts, as well as additional readings. The cost is $5.00 per copy. If you are interested contact the National Association of Towns and Townships, 1522 K Street NW., Suite 730, Washington, D.C. 20050 or call (202) 737-5200.