1. Summary

Program Purpose:

To facilitate the renovation and improvement of commercial buildings within a specified area of downtown Owatonna.  This loan can be used in conjunction with other EDA loans provided the requirements of those loans are also met.
Eligibility and Design Guidelines:

This program is restricted to owners or renters of commercial buildings located in the “Central Business District" of Downtown Owatonna. Improvements must comply with the Main Street Owatonna Design Guidelines, which can be downloaded here.
Eligible Exterior Projects:

Include, but are not limited to:
  • Uncovering transom windows
  • Store front windows
  • Street-facing (front) 2nd floor windows
  • Awning
  • Paint
  • Canopy
  • Doors
  • Signs
  • Lighting
  • Brick & mortar (tuck pointing)
Designs must be approved by the Owatonna Main Street Committee.

Eligible Interior Projects:

Include, but are not limited to:
  • Sprinkler systems
  • ADA accessible restrooms
  • Projects bringing the building into compliance with the ADA
  • Elevators
  • Projects must be completed within 12 months of approval.
  • Projects cannot be for new construction.
  • All projects must be in compliance with applicable codes and policies.
  • Loans will be made on a “one-time” basis for each building. Businesses occupying more than one building will be considered as one building, and a building containing more than one business will be considered as one building for loan evaluation purposes.
  • Loan must be approved before the project starts.
Loan Terms:

$20,000 available total per building:
  • Exterior Projects: Up to $10,000 per building (not to exceed 50% of project cost).
  • Interior Projects: Up to $10,000 per building (not to exceed 50% of project cost).
  • The borrower’s contribution toward matching funds may be in the form of “sweat equity,” but only if the value of this equity is substantiated by a bid in writing from a disinterested third party.
  • If the applicant completes a project but doesn’t use the entire amount available for their loan, they are required to reapply with a new project to utilize the remainder of the $10,000 allocated for the interior or exterior of the building.
Loans are forgivable over a period of five years (20% each year), and cannot be transferred.

If the loan is made to the property owner, the balance is due if the building is sold within the five years.
If the loan is made to the property tenant, the balance is due if the business moves within the five years.

Disbursement of Funds:

Funds are reimbursed once the project is completed, at 50% of the submitted paid receipts (up to the project totals listed above).


All loans require personal guarantees, regardless of business structure.
Approving Authority:

The Owatonna Economic Development Authority, upon recommendation of its loan committee, maintains the authority to approve or deny any loan application. 

The loan committee will evaluate the project application in terms of the following: 
  • Project Design – Evaluation of project design will include review of the plans to determine if the proposed changes are in keeping with the original architectural lines/styles of the building. 
  • Financial Feasibility – Availability of funds, private involvement, financial packaging, and cost effectiveness. 
  • Any other information as required or requested by the EDA.
  • Applicant completes the application below, including providing necessary documentation.
  • The loan committee will review application and may request additional information, as needed.
  • Applicant will meet with Director of the Main Street Owatonna program to review plans.
  • The loan committee will recommend to the EDA to approve or disapprove the application. 
  • If approved, the loan recipient signs loan agreement.
  • Loan recipient starts project.
  • Once completed, the loan recipient submits paid invoices for reimbursement.
  • The Owatonna City Council approves and disburses funds to loan recipient.
  • Loan recipient provides updates and information as requested by the EDA for duration of loan.
Funding Source:

The funding of the Owatonna EDA Forgivable Loan Program is limited. $100,000 has been approved for 2024. Priority will be given in the order that completed applications are received.
Required Documentation for this Application:
  • Plans, diagrams, blueprints, quotes, and/or bids for your project.
  • For exterior projects, a current photo of the building’s exterior and a drawing of the proposed changes.
  • A personal financial statement (if needed, download a template here).
  • Most recent personal tax returns.
For questions about the program or other EDA loan programs, please contact:

Sean Williams
Executive Director
Owatonna Area Business Development Center
(507) 451-0517
To begin your application, click "Next" below.
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