Minority businesses that have more than $1 million in revenue will be eligible for assistance at the new Minority Business Development Agency, which aims to help such companies secure more than $21 million in annual contracts and more than $9 million each year in capital.
The U.S. Commerce Department reportedly opened a Minority Business Development Agency (MBDA) in Minneapolis this week in an effort to help grow minority businesses within the state.
According to the Star Tribune, the MBDA will be run by the Metropolitan Economic Development Association (MEDA) under a five-year contract that’s expected to net $30 million annually and hundreds of jobs for Minnesota’s minority-owned firms.
Specifically, the MBDA aims to help companies secure more than $21 million in annual contracts and more than $9 million each year in capital—which could come in the form of loans, equity investments, or bond funds, according to MEDA executive Jim Faricy, who will lead the new center.
Minority businesses must have more than $1 million in revenue to be eligible for assistance there—and Faricy told the Star Tribune that the state has between 50 and 100 such companies.
MEDA, meanwhile, will receive $1.125 million over five years if it meets the Commerce Department’s contract and employment goals.
The Obama administration is boosting the number of Minority Business Development offices across the country, according to the Star Tribune. The new Minneapolis center is reportedly the 49th office of its type nationally and the first in Minnesota. Over three years, the nation’s Minority Business Development offices have reportedly created 15,000 jobs and helped minority-owned firms secure more than $10 billion in contracts, loans, and other forms of capital.
David Hinson, the MBDA’s national director, told the Star Tribune that the Obama administration realizes that Minnesota has the second-highest black unemployment rate in the country. The new office aims to help reduce that figure.
“There is no question [that] African-American businesses are going to be the driver of employment opportunities for African-American citizens. And so we need more African-American business owners that have the size and scale to hire,” Hinson told the newspaper. “This center is designed to help contribute directly to those businesses growing” and hiring.