Loan Programs

The Watkins Economic Development Authority has two loan programs available to new and existing businesses.  Below are the guidelines for each program.  Applications for either loan program may be obtained at City Hall.

The EDA also works with both Meeker County Economic Development Authority and Meeker County Development Corporation.  For information on their programs, call 320-693-4620 or click on Links and go to Meeker County's website and click on Economic Development.  You may also contact City Hall.

                 o Downtown/Commercial Rehab Loan Program

The Downtown/Commercial Rehabilitation Loan Program is intended to provide low interest loans to property owners of any commercial property for interior and exterior improvements to buildings, as well as improvements related to safety, accessibility, habitability, and energy consumption.  Interior improvements must be made in retail/customer or business areas of the building only.  Loans are not available to remodel apartments above the business or areas generally not accessible by the Public.

Loan amount:  The maximum loan amount is $5,000 or 50% of the total project cost.  The minimum loan amount is $1,000.  There shall be only one active loan per business location.

Interest rate and loan term:  The interest rate will be 4% for a maximum term of five (5) years.  If the borrower sells or transfers title, the loan must be paid in full.

Eligible properties:  Eligible properties must be located with the Central Business District between First Street and Second Street on either side of Central Avenue, and any other property zoned commercial within the corporate limits of Watkins.
 Eligible exterior improvements include the following:
- Windows and doors
- Painting, sandblasting, or other facade improvements
- Roofs
- Foundations
- Exterior lighting
- Handicap accessibility (ramps)
- Cement work such as steps and sidewalks
- Parking lots
- Landscaping

Eligible safety, accessibility, habitability and energy consumption improvements include the following:
- Heating
- Plumbing
- Electrical
- Insulation
- Handicap accessibility
- Asbestos abatement

Eligible interior improvements include the following:
- General remodeling
- Lighting improvements-only in areas accessible by the public
- Built-in cabinetry-only in areas accessible by the public.
- Painting or other wall coverings-only in areas accessible by the public
- Flooring-only in areas accessible by the public

Ineligible interior improvements:  Projects not eligible for the Commercial Rehab. Loan Program include refinancing prior debt, working capital, inventory, and improvements that are removable such as:
- Security Systems
- Equipment
- Furniture

Projects that have already bee initiated are not eligible.

Work by owner:  Work can be performed by the owner.  Loan funds cannot be used to compensate for labor, only for materials.  Materials must be purchased, installed, and inspected prior to the disbursement of the loan proceeds.

Application Processing:  The Watkins Economic Development Review Team will review all projects and make a recommendation of approval or denial to the Watkins EDA Board.  The EDA Board will review all applications for final approval.  The loan must be approved before the applicant can begin the project.

Delinquent loans:  Borrowers will pay a late charge on delinquent loans.  A late payment (not paid by the last day of the month) will automatically incur a charge of monthly interest plus either 5% of the monthly payment amount or $5.00, whichever is the greater amount.  Delinquent notices will be mailed to borrowers.

Contractor/permits:  A minimum of one bid must be obtained from contractors.  All permits required by the city must be obtained.

Custody of funds and disbursement process:  Loan funds will remain in an escrow account maintained by the EDA until work is completed.  No funds will be released without an inspection by the EDA Review Team.

                              o Revolving Loan Program

The purpose of the City of Watkins' Revolving Loan Program is to initiate, facilitate, and promote the economic and industrial development interest of the City of Watkins, thereby creating additional Low and Moderate Income (LMI) jobs in the community.

The Watkins Revolving Loan Program has been established as one way of locally addressing economic and industrial development in the city.  Loans under this program are intended to benefit all citizens of the City of Watkins by meeting one or more of the following requirements:  
- Promoting the Creation or retention of jobs
- Creating or retaining a stable economic base
- Increasing the tax base of the City of Watkins

The Watkins Revolving Loan Program is intended to be a permanent revolving fund where money is available for new loans on a continuing basis as loans are repaid.  Loans will serve as funds to assist existing business or industry or help in the development of new business ventures.


1. The Watkins Economic Development Authority will review and study all revolving loan application requests submitted to the city.  The Authority will then report their findings to the Watkins City Council.  The Watkins City Council shall make the final determination on all loan requests.
2. Loans shall range from a minimum of $2,500 to a maximum of $50,000.  Loan requests above $30,000 must demonstrate an ability to meet or provide a great and genuine community need.  The normal terms of a negotiated loan are for a period of five (5) to ten (10) years.   The use of the loan shall determine the term.
3. The interest rate shall be at a rate of 2.5% below the current prime interest rate or a 3% minimum interest rate.  The loan repayment schedule shall be determined on an individual loan basis.
4. The enterprise receiving a Watkins Revolving Loan shall create a minimum of one permanent full time equivalent job for each $10,000 of loan funds or create $20,000 in tax assessments (during the period of the loan) for each $10,000 of loan funds.  Loans $25,000 and over shall be required to enter into a Business Subsidy Agreement with the city as per Minnesota Statutes, Section 116J.993-116J.995.
5. If a particular project does not involve the creation of jobs, but is nonetheless found to be worthy of support and subsidy, it may be approved without any specific job or wage goals, as may be permitted by applicable law.
6. Private funds in the project should include the developer's equity equal to at least ten percent (10%) of the entire project cost.
7. The City of Watkins shall take a security interest position in all equipment, accounts receivable, real estate, or inventory financed by the Revolving Loan Program.  The City shall also require the personal guarantees of the applicant.
8. The City of Watkins may contract with a bank or private consultant for the administration and serving of the Revolving Loan Program
9. Cost of legal fees and filing fees will be covered by the applicant.


1. Any existing or new business or industry located or locating within the corporate city limits of the City of Watkins shall be eligible for the Watkins Revolving Loan Program.

2. Activities eligible for loan program funds include:
    a. Fixed machinery and equipment
    b. Building purchase, construction, and renovation
    c. Leasehold improvements
    d. Land acquisition
    e. Plant modernization
    f. Inventory

3. Ineligible activities include:
    a. Agricultural production
    b. Past completed projects
    c. Refinancing of other privately loans or mortgages

 Loan applications are available at City Hall.