Jobs and economic development supplemental appropriations provided, competitive grants established, emergency relief loans for small businesses provided, construction codes and licensing modified, and money appropriated.

A bill for an act

relating to state government; making supplemental appropriations to the jobs and

economic development budget; establishing Pathways to Prosperity competitive

grants; establishing Drive for Five competitive grants; establishing emergency

relief loans for impacted small businesses; modifying construction codes and

licensing provisions; making policy and technical changes; appropriating money;

amending Minnesota Statutes 2024, sections 116J.435, by adding a subdivision;

326B.33, subdivision 4; 326B.36, subdivision 3; 326B.37, subdivision 7; Minnesota

Statutes 2025 Supplement, section 326B.37, subdivisions 5, 6; proposing coding

for new law in Minnesota Statutes, chapter 116L; repealing Minnesota Statutes

2024, section 326B.33, subdivisions 5, 6.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

APPROPRIATIONS

Section 1.
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APPROPRIATIONS.
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The sums shown in the columns marked "Appropriations" are added to or, if shown in

parentheses, subtracted from the appropriations in Laws 2025, First Special Session chapter

6, article 1, to the agencies and for the purposes specified in this article. The appropriations

are from the general fund, or another named fund, and are available for the fiscal years

indicated for each purpose. The figures "2026" and "2027" used in this article mean that

the appropriations listed under them are available for the fiscal year ending June 30, 2026,

or June 30, 2027, respectively. "The first year" is fiscal year 2026. "The second year" is

fiscal year 2027. "The biennium" is fiscal years 2026 and 2027.

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APPROPRIATIONS

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Available for the Year

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Ending June 30

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2026

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2027

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Sec. 2.
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DEPARTMENT OF EMPLOYMENT

AND ECONOMIC DEVELOPMENT
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Subdivision 1.

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Total Appropriation

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$

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10,000,000

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$

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3,500,000

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Appropriations by Fund

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2026

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2027

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General

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10,000,000

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-0-

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Workforce

Development

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-0-

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3,500,000

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The amounts that may be spent for each

purpose are specified in the following

subdivisions.

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Subd. 2.

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Business and Community Development

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10,000,000

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-0-

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$10,000,000 the first year is for emergency

relief loans to businesses under article 4. This

appropriation is onetime and is available until

June 30, 2027.

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Subd. 3.

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Workforce Development Services

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-0-

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3,500,000

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$3,500,000 the second year from the

workforce development fund is for grants to

expand service opportunities, including but

not limited to the ServeMinnesota Innovation

Act, Minnesota Statutes, sections 124D.37 to

124D.45; the Domestic and Volunteer Service

Act of 1973, United States Code, title 42,

section 4950; and the National and

Community Service Act of 1990, United States

Code, title 42, section 12501. Of this amount,

up to five percent may be used for

administration of the grants. This is a onetime

appropriation.

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ARTICLE 2

PATHWAYS TO PROSPERITY

Section 1.

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[116L.981] PATHWAYS TO PROSPERITY PROGRAM.

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Subdivision 1.

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Definitions.

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(a) For purposes of this section, the following terms have

the meanings given.

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(b) "Commissioner" means the commissioner of employment and economic development.

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(c) "Pathways to Prosperity program" or "program" means the competitive grant program

created in this section.

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Subd. 2.

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Establishment.

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The commissioner must establish the Pathways to Prosperity

program to make competitive grants to government entities and nonprofit organizations for

workforce training and development programs for adults facing barriers to employment.

Programs must support and assist individuals to prepare for and find employment that

provides long-term employment opportunities and leads to family-sustaining wage careers

in in-demand industry sectors.

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Subd. 3.

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Grant process.

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(a) The commissioner must award grants to applicants through

a competitive grant process in a form and manner prescribed by the commissioner.

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(b) The commissioner must develop scoring criteria for making grants. The criteria must

include an evaluation of the applicant's capacity to:

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(1) work with individuals facing barriers to employment such as the long-term

unemployed, justice-impacted individuals, and individuals with limited English proficiency;

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(2) prepare individuals for long-term employment opportunities with family-sustaining

wages;

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(3) align with the labor market of the community where the applicant operates;

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(4) provide wraparound support services to assist individuals with entering and completing

the program, including, but not limited to, assistance with housing, transportation, and child

care, as well as adult basic education or English as a second language services;

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(5) provide individualized counseling to achieve the individual's education and career

goals;

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(6) provide training and education components that lower barriers to completion and

allow for accelerated attainment of goals;

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(7) provide a career pathway for training that results in a relevant academic award,

certificate, or industry-recognized credential that helps the individual enter or advance in a

specific occupation or occupational cluster; and

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(8) provide targeted placement and job search assistance for individuals who complete

training.

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(c) The commissioner must provide applicants with technical assistance to understand

application procedures and program guidelines, and prioritize assistance to small

organizations without prior state grant experience. All reporting requirements for grant

recipients must be described in plain language in both the request for proposal and the grant

contract.

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(d) Successful grant recipients must:

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(1) align services with the skill needs of high-growth industries in the state, regional, or

local economy;

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(2) prepare individuals to enter in-demand careers;

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(3) provide counseling and support to achieve the individual's education and career goals;

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(4) provide, as appropriate, education offered concurrently with and in the same context

as workforce preparation activities and training for a specific occupation or occupational

cluster;

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(5) organize education, training, and other services to meet the particular needs of an

individual, including education in English as a second language, in a manner that attempts

to accelerate the educational and career advancement of the individual;

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(6) enable an individual to attain a relevant academic award, certificate, or

industry-recognized credential;

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(7) assist an individual to enter or advance within a specific occupation or occupational

cluster; and

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(8) include partnerships with employers, workforce service providers, adult basic

education providers, and post-secondary training providers, where one entity may fulfill

multiple roles.

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Subd. 4.

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Performance metrics.

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(a) Reporting and performance outcomes must comply

with the requirements of section 116L.98. Performance requirements require results within

15 percent of contracted measurable outcomes, including the number of participants served.

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(b) At least 60 percent of enrolled participants must exit the program by either: (1)

obtaining unsubsidized employment at or above a family-sustaining wage as defined by the

Department's Labor Market Information Office cost-of-living index adjusted for family size

and location; or (2) continuing to participate in higher education.

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ARTICLE 3

DRIVE FOR FIVE INDUSTRY SECTOR TRAINING

Section 1.

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[116L.982] DRIVE FOR FIVE TRAINING.

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Subdivision 1.

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Establishment.

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The commissioner shall establish the Drive for Five

grant program to fill high-wage, high-demand job vacancies in an eligible industry sector.

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Subd. 2.

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Definitions.

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(a) For purposes of this section, the following terms have the

meanings given.

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(b) "Eligible industry" or "industry sector" means the following industries: technology,

labor, care professions, manufacturing, and education and professional services. The term

also includes any other industry the commissioner identifies based on the most recent labor

market data if the industries listed in this paragraph no longer reflect current labor market

conditions.

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(c) "Eligible organization" includes, but is not limited to, a nonprofit organization with

active nonprofit tax filing status, a state or local government unit, including a Tribal

government, a community action agency, a postsecondary institution, and a labor

organization.

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(d) "High-wage, high-demand" means occupations that represent at least 0.1 percent of

total employment in the base year, have an annual median salary which is higher than the

average for the current year, and are projected to have more total openings as a share of

employment than the average.

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(e) "Training" includes, but is not limited to, workforce development services, including

job skills training, career counseling, case management, industry-recognized credential or

certification attainment, work experience and internships, and support services.

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Subd. 3.

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Grant program.

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The commissioner shall establish a competitive grant process

to distribute awards under this section. The commissioner shall make grants to eligible

organizations that provide training in a high-wage, high-demand industry sector. In awarding

competitive grants, the commissioner shall give priority to eligible organizations that partner

with employers and postsecondary education institutions.

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Subd. 4.

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Eligible uses.

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(a) Grants awarded under this section may be used for:

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(1) job skills training that leads to or results in an industry-recognized credential;

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(2) career counseling;

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(3) case management;

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(4) paid work-based learning opportunities;

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(5) contextualized education programming that provides a tailored curricula to help

students attain work readiness;

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(6) support services;

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(7) navigation services; and

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(8) job placement and retention services.

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(b) All awarded grants shall include a performance requirement within a 15 percent

variance of contracted measurable outcomes including number enrolled. Sixty percent of

enrolled participants must exit the program to unsubsidized employment at or above a wage

designated by the commissioner.

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Subd. 5.

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Priority.

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The commissioner shall prioritize awarding grants under this section

to eligible organizations that partner with a Drive for Five industry partnership applicant

under section 116L.983.

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Sec. 2.

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[116L.983] DRIVE FOR FIVE INDUSTRY PARTNERSHIPS.

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Subdivision 1.

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Establishment.

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The commissioner shall establish a grant program for

eligible organizations to better align workforce training efforts with employer demands by

connecting workforce training participants to job vacancies.

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Subd. 2.

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Definitions.

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For purposes of this section:

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(1) "eligible organization" means a chamber of commerce with a 501(c)(6) tax filing or

a trade association with a 501(c)(6) tax filing; and

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(2) "industry sector employer" means an employer with current or anticipated employment

opportunities in an eligible industry as defined in section 116L.982, subdivision 2, paragraph

(b).

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Subd. 3.

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Grant program.

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The commissioner shall award grants to eligible organizations

that provide services that lead to employment. Recipients shall partner with employers with

current or anticipated employment opportunities and workforce training partners participating

in Drive for Five industry sector training under section 116L.982.

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Subd. 4.

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Eligible uses.

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Grants awarded under this section may be used for:

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(1) employer engagement strategies, including but not limited to business recruitment,

job opening development, employee recruitment, and job matching;

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(2) diversity, inclusion, and retention training of Drive for Five industry sector employers

to increase the employer's understanding of attracting and retaining a diverse workforce;

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(3) advanced skills training for incumbent workers of Drive for Five industry sector

employers; and

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(4) support services.

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Subd. 5.

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Reports.

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Grant recipients must report quarterly to the commissioner the number

of incumbent workers trained, names of employers trained or engaged, and the results of

those efforts on the Drive for Five industry sector training programs.

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Subd. 6.

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Priority.

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The commissioner shall prioritize awarding grants under this section

to eligible organizations that partner with a Drive for Five industry sector training under

section 116L.982.

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Sec. 3.

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[116L.984] DRIVE FOR FIVE EMPLOYER ENGAGEMENT TEAM.

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Subdivision 1.

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Establishment.

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Within the limits of available appropriations for this

section, the commissioner shall establish a Drive for Five employer engagement team which

must consist of business service representatives who connect job seekers in Minnesota's

job centers with businesses.

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Subd. 2.

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Duties.

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Business service representatives shall:

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(1) serve as the primary contact for businesses with hiring needs within a particular

geography;

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(2) engage with employers by matching employers to job seekers through candidate

referrals, convening job fairs, and distributing job announcements;

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(3) work with local area workforce boards and partners to identify candidates for openings

in small- and medium-sized companies; and

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(4) engage in workforce innovation solutions.

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ARTICLE 4

BUSINESS AND COMMUNITY DEVELOPMENT PROVISIONS

Section 1.

Minnesota Statutes 2024, section 116J.435, is amended by adding a subdivision

to read:

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Subd. 8.

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Development restrictions expiration.

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If, within ten years from the date of the

grant award under this section, the eligible project for which the public infrastructure was

intended has not been developed, the public infrastructure may thereafter be used to support

any other lawful project. The city or county must notify the commissioner of the alternative

project.

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Sec. 2.
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EMERGENCY RELIEF LOANS FOR IMPACTED SMALL BUSINESSES

PROGRAM.
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Subdivision 1.

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Definitions.

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(a) For purposes of this section, the following terms have

the meanings given.

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(b) "Borrower" means a recipient of a loan under this section.

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(c) "Commissioner" means the commissioner of employment and economic development.

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(d) "Eligible recipient" means a business located in Minnesota that:

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(1) demonstrates at least $200,000 in annual gross revenue but no more than $4,000,000

in annual gross revenue based on tax statements from the business's prior taxable year;

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(2) operates from a physical commercial location;

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(3) has at least one employee on payroll;

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(4) does not primarily generate revenue from passive or speculative investments or from

gambling activities; and

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(5) has been in operation at least one year and can demonstrate that the business

experienced economic injury of at least a 33 percent decline in gross revenue between

December 1, 2025, and February 28, 2026, compared to the same time period in the previous

year.

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(e) "Partner organization" or "partner" means nonprofit corporations that have current

contracts to enroll small business loans in the emerging entrepreneur program, the federal

State Small Business Credit Initiative, or both, and that will provide loans under this section.

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(f) "Physical commercial location" means a permanent location that is not a residence

from which a business operates on a year-round basis.

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(g) "Program" means the emergency relief loans for impacted small businesses program

under this section.

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Subd. 2.

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Establishment.

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(a) The commissioner shall establish the emergency relief loans

for impacted small businesses program to purchase a participation interest in loans made

by partner organizations to eligible recipients.

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(b) The commissioner may negotiate and enter into agreements with the partner

organizations to purchase loans originated under this section. Agreements under this section

are considered financial assistance agreements and are not considered procurement or grant

contracts.

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(c) The commissioner may adopt guidelines, forms, and procedures necessary to

implement this section.

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Subd. 3.

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Loan participation.

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(a) A partner organization must enter into an agreement

with the commissioner to make loans under this section.

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(b) The commissioner shall purchase a 100 percent participation interest in loans made

to eligible recipients by partner organizations.

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(c) Partner organizations are responsible for underwriting, servicing, and monitoring of

loans purchased by the commissioner.

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(d) A fee equal to eight percent of any loan made under this section must be paid to the

partner organization at the time the participation interest is purchased to cover program

administration and monitoring.

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(e) Up to two percent of the amount appropriated to the commissioner under this section

may be retained by the commissioner for administration of the program.

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Subd. 4.

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Loans to eligible recipients.

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(a) A partner organization may make loans to

eligible recipients for eligible uses. A loan to an eligible recipient under this subdivision

must:

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(1) be for no less than $2,500 and no more than $25,000;

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(2) be for a term of no more than 39 months;

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(3) charge an interest rate or fee of zero percent;

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(4) not require repayment for at least 90 days after closing;

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(5) require a personal guaranty from each beneficial owner;

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(6) not charge any type of fee to eligible recipients; and

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(7) not require any matching contributions from eligible recipients as a condition of the

loan.

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(b) Eligible uses for loan proceeds include current obligations related to payroll; lease

or mortgage payments; inventory; insurance; property taxes; utilities; and other operating

costs associated with ongoing operations. Borrowers must provide evidence that loan

proceeds were used for eligible expenses.

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(c) Loan proceeds must not be used for:

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(1) purchase of fixed assets, construction, renovation, or leasehold improvements; or

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(2) refinancing of debt.

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Subd. 5.

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Loan forgiveness.

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(a) After making 18 consecutive on-time payments, the

borrower may apply for forgiveness of up to 50 percent of the outstanding principal balance.

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(b) For the purposes of taxable income, the forgivable portion of the loan is exempt from

income tax reporting in Minnesota.

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Subd. 6.

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Partner program account.

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(a) Partner organizations must establish a

commissioner-certified account for the purpose of tracking loans purchased under this

section.

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(b) Loan payments received from borrowers by partner organizations shall be remitted

to the commissioner no more than 30 days following the end of each calendar quarter so

long as any balance remains outstanding on the loans. Remitted payments shall be deposited

in the general fund as nondedicated revenue.

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Subd. 7.

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Reports.

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(a) By January 31, 2029, partner organizations making loans under

this section must provide a report to the commissioner that includes descriptions of the

eligible recipients supported by the program, amounts loaned, proposed and actual uses,

and amount of loan forgiveness granted.

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(b) By April 15, 2029, the commissioner must provide a report compiling the information

received from a partner organization under paragraph (a) to the chairs and ranking minority

members of the legislative committees with jurisdiction over economic development. The

report must also specify any partner organization that failed to provide the information

required under paragraph (a).

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Subd. 8.

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Expiration.

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This section expires December 31, 2033.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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ARTICLE 5

CONSTRUCTION CODES AND LICENSING

Section 1.

Minnesota Statutes 2024, section 326B.33, subdivision 4, is amended to read:

Subd. 4.

Class B installer.

Notwithstanding the provisions of subdivisions 1, 2, and 14,

any individual holding a Class B installer license may lay out and install electrical wiring,

apparatus and equipment on center pivot irrigation booms on the load side of the main

service on farmsteads, and install such other electrical equipment as is approved by the

commissioner.
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As of December 1, 2027, no new Class B installer licenses shall be issued.

An individual who holds a Class B installer license as of December 1, 2027, may retain and

renew the license and exercise the privileges the license grants.
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Sec. 2.

Minnesota Statutes 2024, section 326B.36, subdivision 3, is amended to read:

Subd. 3.

Licenses
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; bond
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.

All inspectors shall hold licenses as master or journeyworker

electricians under this chapter.
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All inspectors under contract with the department to provide

electrical inspection services shall give bond in the amount of $1,000, conditioned upon the

faithful performance of their duties.
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Sec. 3.

Minnesota Statutes 2025 Supplement, section 326B.37, subdivision 5, is amended

to read:

Subd. 5.

Inspection fee for dwelling.

(a) The inspection fee for a one-family dwelling

and each dwelling unit of a two-family dwelling is the following:

(1) the fee for each service or other source of power as provided in subdivision 3;

(2) $165 for up to 30 feeders and circuits; and

(3) for each additional feeder or circuit, the fee as provided in subdivision 4.

This fee applies to each separate installation for new dwellings and where
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15
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14
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or more

feeders or circuits are installed or extended in connection with any addition, alteration, or

repair to existing dwellings. Where existing feeders and circuits are reconnected to

overcurrent devices installed as part of the replacement of an existing panelboard, the fee

for each reconnected feeder or circuit is $2. The maximum number of separate inspections

shall be determined in accordance with subdivision 2. The fee for additional inspections or

other installations is that specified in subdivisions 2, 4, 6, and 8. The installer may submit

fees for additional inspections when filing the request for electrical inspection. The fee for

each detached accessory structure directly associated with a dwelling unit shall be calculated

in accordance with subdivisions 3 and 4. When included on the same request for electrical

inspection form, inspection fees for detached accessory structures directly associated with

the dwelling unit may be combined with the dwelling unit fees to determine the maximum

number of separate inspections in accordance with subdivision 2.

(b) The inspection fee for each dwelling unit of a multifamily dwelling with three or

more dwelling units is $110 for a combination of up to 20 feeders and circuits and $12 for

each additional feeder or circuit. This fee applies to each separate installation for each new

dwelling unit and where ten or more feeders or circuits are installed or extended in connection

with any addition, alteration, or repair to existing dwelling units. Where existing feeders or

circuits are reconnected to overcurrent devices installed as part of the replacement of an

existing panelboard, the fee for each reconnected feeder or circuit is $2. The maximum

number of separate inspections for each dwelling unit shall be determined in accordance

with subdivision 2. The fee for additional inspections or for inspection of other installations

is that specified in subdivisions 2, 4, 6, and 8. These fees include only inspection of the

wiring within individual dwelling units and the final feeder to that unit where the multifamily

dwelling is provided with common service equipment and each dwelling unit is supplied

by a separate feeder or feeders extended from common service or distribution equipment.

The fee for multifamily dwelling services or other power source supplies and all other

circuits is that specified in subdivisions 2 to 4.

(c) A separate request for electrical inspection form must be filed for each dwelling unit

that is supplied with an individual set of service entrance conductors. These fees are the

one-family dwelling rate specified in paragraph (a).

Sec. 4.

Minnesota Statutes 2025 Supplement, section 326B.37, subdivision 6, is amended

to read:

Subd. 6.

Additions to fees of subdivisions 3 to 5.

(a) The fee for the electrical supply

for each manufactured home park lot is $35. This fee includes the service or feeder conductors

up to and including the service equipment or disconnecting means. The fee for feeders and

circuits that extend from the service or disconnecting means is that specified in subdivision

4.

(b) The fee for each recreational vehicle site electrical supply equipment is $12 for each

circuit originating within the equipment. The fee for recreational vehicle park services,

feeders, and circuits is that specified in subdivisions 3 and 4.

(c) The fee for each street, parking lot, or outdoor area lighting standard and each traffic

signal standard is $5. Circuits originating within the standard or traffic signal controller

shall not be used when calculating the fee for each standard.

(d) The fee for transformers for light, heat, and power is $15 for transformers rated up

to ten kilovolt-amperes and $30 for transformers rated in excess of ten kilovolt-amperes.

The previous sentence does not apply to Class 1 transformers or power supplies for Class

1 power-limited circuits or to Class 2 or Class 3 transformers or power supplies.

(e) The fee for transformers and electronic power supplies for electric signs and outline

lighting is $5 per unit.

(f) The fee for technology circuits or systems, and circuits of less than 50 volts, is 75

cents for each system device or apparatus.

(g) The fee for each separate inspection of the bonding for a swimming pool, spa,

fountain, an equipotential plane for an agricultural confinement area, or similar installation

is
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$35
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$55
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. Bonding conductors and connections require an inspection before being

concealed.

(h) The fee for all wiring installed on center pivot irrigation booms is $35 plus $5 for

each electrical drive unit.

(i) The fee for retrofit modifications to existing lighting fixtures is 25 cents per luminaire.

(j) When a separate inspection of a concrete-encased grounding electrode is performed,

the fee is $55.

(k) The fees required by subdivisions 3 and 4 are doubled for installations over 600

volts.

(l) The fee for a class 4 circuit or system transmitter, receiver, or utilization equipment

is $0.50 for each system device or apparatus.

Sec. 5.

Minnesota Statutes 2024, section 326B.37, subdivision 7, is amended to read:

Subd. 7.

Investigation fee: work without electrical inspection request.

(a) Whenever

any work for which a request for electrical inspection is required has begun without the

request for electrical inspection form being filed with the commissioner, a special

investigation shall be made before a request for electrical inspection form is accepted.

(b) An investigation fee, in addition to the full fee required by subdivisions 1 to 6
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and

16 to 18
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, shall be paid before an inspection is made. The investigation fee is two times the

minimum fee specified in subdivision 2 or the
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applicable
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inspection fee required by

subdivisions 1 to 6
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and 16 to 18
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, whichever is greater, not to exceed $1,000. The payment

of the investigation fee does not exempt any person from compliance with all other provisions

of the department rules or statutes nor from any penalty prescribed by law.

Sec. 6.
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REPEALER.
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(a)

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Minnesota Statutes 2024, section 326B.33, subdivision 5,

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is repealed effective

December 1, 2027.

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(b)

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Minnesota Statutes 2024, section 326B.33, subdivision 6,

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is repealed effective August

1, 2026.

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APPENDIX

Repealed Minnesota Statutes: 26-08297

326B.33 LICENSES.

Subd. 5.

Coursework or experience.

An applicant for a Class A or B installer license shall have completed a post high school course in electricity approved by the commissioner or shall have had at least one year of experience, approved by the commissioner, in electrical wiring.

Subd. 6.

Bond.

Every Class A and Class B installer, as a condition of licensure, shall give bond to the state in the penal sum of $1,000. The bond must comply with section
326B.0921
.