May 28, 2024

FOR MORE INFORMATION:

Jordan Metsa, Communications Director

218-735-3061, Jordan.Metsa@state.mn.us

Businesses, communities, housing and outdoor recreation in northeastern Minnesota receive over $13 million in economic development funding

At today's Iron Range Resources & Rehabilitation (IRRR) Board meeting, an estimated $9.5 million in business loans and grants, $2.9 million in housing grants, $793,652 in infrastructure grants and $52,600 in trails grants were reviewed to advance projects in northeastern Minnesota. Agency investment for all projects combined is over $13.2 million. Total project investment is estimated at $66 million. The projects are expected to diversify the local economy, increase the regional tax base, retain and create jobs, grow the housing inventory, modernize essential infrastructure and expand outdoor recreation.

“The project investments made today are expected to have a substantial impact in the Taconite Assistance Area. The business development projects especially will increase the number of living-wage jobs, grow our manufacturing sector and upgrade critical operations equipment for existing businesses,” said Commissioner Ida Rukavina. “The agency’s new fiscal year budget was also approved which enables us to continue investing in the region’s businesses, communities and workforce. I am excited for the future of our region and for everyone living here.”

Business Development Loans & Grants

Agency Investment: $9,475,000 | Total Project Investment: $26,150,000

• Hibbing Economic Development Authority (HEDA), Hibbing: $4,500,000 to construct a 34,000-square-foot manufacturing facility on an existing city-owned lot. The entire building will be leased to Advanced Machine Guarding Solutions (AMGS) to accommodate its future growth plans. AMGS was founded in 2021 and is located in Hibbing. It designs and produces safety steel wire mesh guarding for the automation industry. AMGS also supplies other manufacturing companies’ safety products to ensure the operating equipment meets OSHA standards in the U.S. and Canada.
• Cast 7 LLC, Hibbing: $275,000 to purchase and install a new waterjet machine and new pneumatic manipulators. The waterjet machine is key to finishing freshly cast stainless steel products. The manipulators will alleviate the strenuous burden of operators handling hot and heavy parts. The new equipment will streamline the casting process to help meet the projected demand for casting.
• L&M Supply Inc., Grand Rapids: $1,000,000 to provide the gap funding needed to construct a 200,000-square-foot greenfield, state-of-the-art distribution center. The new distribution center will replace one that is operating in nearby LaPrairie but is not large enough to accommodate the company’s current operations and anticipated future growth. Due to the continued company growth, the facility is no longer capable of processing, storing and distributing the volume of goods needed to support the stores. The agency provided a previous loan of $2,500,000 for the project.
• Finnegan’s Farm, Two Harbors: $950,000 to purchase equipment that will extract oils from hemp plants. Finnegan’s must currently send their hemp material to the metro area for processing, which is time consuming and cost prohibitive. Processing in-house will expand operations and lead to cost savings.
• Fond du Lac Cannabis Corporation, Brookston: $2,500,000 Loan and $250,000 Grant to support a start-up business that will supply medical and adult use cannabis products to the community. The business will consist of three components: cultivation, manufacturing and retail. Cultivation and manufacturing will take place in the town of Brookston, Minnesota in an 18,000-square-foot building. Retail operations will occur in a separate building along the Highway 210 Corridor in Carlton County, Minnesota. 

The advisory board recommended funding four of the business development projects with the exception of the Fond du Lac Cannabis Corporation project. However, Commissioner Rukavina plans to move the project forward. She said, "The Fond du Lac manufacturing project successfully completed the application process according to the agency’s guidelines. Furthermore, the agency's proficient team exerted considerable effort to thoroughly evaluate the project before presenting it to the board. That said, this project will support numerous new manufacturing jobs in a rural area of St. Louis County that will further diversify and strengthen our region’s economy. For these reasons, I will move this project forward."

Housing Grants

Agency Investment: $2,924,750 | Total Project Investment: $34,587,561

• East Range Joint Powers Board: $20,000 to fund the East Range Seller Readiness Rehabilitation program, which will help a minimum of 10 home sellers make repairs using a short-term loan that will be repaid at closing. The newly refurbished homes will meet inspection requirements for purchase through traditional financing, which increases the homes resell ability.
• Center for Energy & Environment (CEE): $298,171 to pilot an owner-occupied rehabilitation loan program that targets five communities across the Iron Range with the oldest housing stock: Hibbing, Chisholm, Eveleth, Ely and Aurora. A minimum of 45 low interest housing rehabilitation loans will be provided to existing homeowners in the targeted communities.
• Bois Forte Band of Chippewa: $356,579 to rehabilitate up to three vacant units on the Vermilion Sector of the Bois Forte reservation. The project is part of an overall housing plan to rehabilitate seven vacant units across the Bois Forte reservation and provide much needed housing options for workers.
• Lake County Housing & Redevelopment Authority: $350,000 to construct a new two-story, 27-unit market rate workforce apartment building.
• Center City Housing Corp.: $1,900,000 to construct 52 new workforce housing rental units including a three-story apartment building (one- and two-bedroom units) and town homes (three- and four-bedroom units) to replace the blighted housing units located at Haven Court Apartments (commonly known as Greenhaven Apartments). The new development, Cobb Cook Place will be located about 10 blocks from Haven Court Apartments.

Development Infrastructure Grants

Agency Investment $140,000 | Total Investment $1,726,000

• City of Coleraine: $140,000 to construct the infrastructure and site work for development of a 6,000-square-foot addition to Home and Comfort Assisted Living. Home and Comfort is currently in a 5,000-square-foot facility which will be completely renovated along with the 6,000-square-foot expansion. When completed, the newly expanded facility will provide 22 private rooms and two shared rooms and serve up to 26 residents. 

Community Infrastructure Grants

Agency Investment $530,000 | Total Investment $3,431,785

• City of Eveleth: $180,000 to add new water metering technology infrastructure to all residential and commercial properties.
• City of Biwabik: $150,000 to construct the infrastructure and make facility upgrades to the Vermillion Trail Campground including a new lift station, trail and road reconstruction and bathroom facility upgrades.
• City of Beaver Bay: $200,000 to construct a new water intake for the city’s municipal water system.

Infrastructure Grant Increases

Agency Investment $123,652

IRRR previously provided grant funding for the two projects. The grant increases are due to construction bids being higher than originally anticipated.

• Breitung Township: $33,652 to construct the infrastructure related to improvements of the sanitary and storm sewer system on First Avenue and Church Street.
• City of Keewatin: $90,000 to improve the O'Brien Reservoir Recreation Area and partially reconstruct North First Street.

Regional Trails Grants

Agency Investment $52,600 | Total Investment $105,200

• City of Hoyt Lakes: $37,600 to repave biking and walking trails and resurface the parking lot at the Midway Recreation Area.
• Gunflint Trail Society: $15,000 to build a new accessible boardwalk trail, update other trails, add a kiosk and develop interpretive signage at the Chik-Wauk Museum and Nature Center located at the end of the Gunflint Trail in Cook County.

The projects reviewed at today’s board meeting support the agency’s fiscal year 2024 spending plan which helps to fund projects in business, community and workforce development in the Taconite Assistance Area.

Fiscal Year 2025 Budget & Spending Plan

The FY25 IRRR budget and spending plan was approved at the May 28 board meeting. The $62 million investment strategy exemplifies the agency’s unwavering commitment to fostering a more prosperous living and working environment in its service area. Strategic priorities and funding include:

• Improve conditions for economic growth with $28 million of resources in community and workforce development. Funds include a $6 million program to promote the preservation, rehabilitation and investment in regional housing stock and neighborhoods.
• Support public works infrastructure, broadband and business and industry with spending of $16 million, 26% of the budget. Infrastructure funding assists communities in modernizing, redeveloping and replacing foundational assets in order to attract business investment and expansion.
• Invest funds in natural and recreational assets to generate diversification and economic impact while contributing to the quality of life in the region.
• Produce a fiscally sound spending plan that includes reserve funds for unforeseen future needs.