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As the Twin Cities’ small businesses work to rebuild, government has a vital role to play

More than a year has gone by without any state or federal recovery dollars for rebuilding.

Debris remains on the site after the building where Gandhi Mahal was located was destroyed, as owner Ruhel Islam awaits permits.
MinnPost photo by Henry Pan
Debris on the site after the building where Gandhi Mahal was located was destroyed.
Last year, the civil unrest sparked by the murder of George Floyd left a path of significant destruction in Minneapolis and St. Paul. Hundreds of local shops – from grocery stores to gas stations to restaurants – as well as nonprofits and health care clinics were decimated. Many of these damaged small businesses are owned by families, immigrants, low-income entrepreneurs, and by Black, Indigenous and People of Color (BIPOC) business owners. 

The challenges they have faced over the past 12 months have been overwhelming. As they try to support their families and communities, many have simultaneously lost their buildings, their inventory and equipment, and their incomes, all while navigating the COVID-19 pandemic. Difficult decisions about furloughing or laying off their employees have had to be made, negatively impacting those local families. Meanwhile, insurance has only covered anywhere from zero to 40% of their total losses.

Despite this, small business owners have rolled up their sleeves and gotten creative. They have applied for countless grants, set up GoFundMe pages and launched websites to serve customers virtually. And each step of the way, everyday Minnesotans have helped them – by donating their own hard-earned money, volunteering or committing to shop from small businesses. 

In total, these donations have fueled more than $10 million in grants for small businesses through nonprofits like the Lake Street Council. This impact is enormous and deserves to be celebrated. We greatly appreciate the generosity of both Minnesotans and people from across the country who have contributed. They have helped many small businesses through these difficult times to a point where they could rebuild and reopen.

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But $10 million in philanthropy – even $20 million – sadly cannot build back the Twin Cities’ small businesses alone. Last year’s civil unrest caused more than $500 million in damages. The scope of this damage is truly a crisis on the same scale as a tornado, hurricane or other natural disaster.

Despite this time of incredible pain and destruction our government has quietly remained on the sidelines, allowing more than a year to go by without any state or federal recovery dollars specifically for rebuilding or development. We have seen two presidential administrations and eight sessions of the Minnesota Legislature, yet no concrete action. 

This lack of action has occurred while unprecedented levels of federal funding floods into our state, further bolstering the potential for action when paired with our budget surplus. We know there are many demands on this funding, but building back these commercial corridors and supporting local Minnesota businesses needs to be a priority.

During the civil unrest, entire buildings were damaged to the point of needing rebuilding. Many affected business owners have limited incomes without much equity to secure needed financing; they are also not property developers, and many don’t have the experience needed to lead a redevelopment. The high cost of new construction makes affordable rent rates impossible without public subsidies, made worse by the nonexistence of affordable commercial rent subsidy programs in the metro.

Because of this, we run the very real risk of national developers making widespread land purchases and raising the cost of rent to rates that only national retailers and other big businesses could afford to operate on Lake Street and other neighborhoods in the Twin Cities. We could lose hundreds of family-run businesses. 

What happens in neighborhoods like ours does not happen in a vacuum. It has real-life impacts that ripple exponentially. These small businesses create jobs, spur innovation, promote ethnic and cultural diversity, generate millions of dollars in local tax base, fight to close the wealth gap, and boost economic growth. They benefit the Twin Cities metro and, in turn, the entire state.

After a year of Minnesotans weathering this storm alone, it is time for our state and federal governments to step up and invest in our region’s recovery.

Kenya McKnight Ahad, Henry Jiménez and Allison Sharkey
Kenya McKnight Ahad, Henry Jiménez and Allison Sharkey
Kenya McKnight Ahad is the executive director of the Black Women’s Wealth Alliance. Henry Jiménez is the executive director and president of the Latino Economic Development Center. Allison Sharkey is the executive director of the Lake Street Council.

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