The Minnesota Department of Employment and Economic Development (DEED) has announced over $20.7 million in grants through the Small Cities Development Program (SCDP) to boost economic development across 33 cities and counties in Greater Minnesota. The funding will help rehabilitate nearly 300 properties, focusing on housing, infrastructure, and commercial spaces.
In southern Minnesota, cities such as Fairfax, Fulda, Lake Lillian, Lamberton, Tracy, and Walnut Grove are among the beneficiaries. DEED Commissioner Matt Varilek said the program supports projects that strengthen communities, enhance quality of life, and ensure all Minnesotans benefit from economic growth.
The SCDP program helps small cities, townships, and counties fund housing improvements, public infrastructure, and business rehabilitation projects. Its main goal is to serve low- and moderate-income communities by addressing slum conditions, safety risks, and other community challenges. This year, 92% of the funded projects serve residents within these income groups.
Eligible communities must have populations under 50,000 for cities and under 200,000 for counties. The grants are managed by DEED and funded by the U.S. Department of Housing and Urban Development (HUD).
Projects receiving funding include housing repairs such as roof replacements, insulation, plumbing, and accessibility upgrades for owner-occupied and rental homes. Commercial projects will support improvements like new signage, building repairs, and energy efficiency upgrades for local businesses. Public facility projects will improve community infrastructure such as streetscapes, water systems, and wastewater treatment plants.
Some of the key grant recipients include Annandale, which will receive $875,440 to renovate homes and commercial buildings; Appleton, which will get $1.2 million for housing and storm sewer upgrades; and Barnesville, awarded $1.2 million for home and business improvements. Other recipients include Brainerd for streetscape upgrades, Canby for home and business rehabilitation, and several small towns such as Eden Valley, Elizabeth, and Erskine, each receiving $600,000 for water and sewer projects.
Communities like Fulda will use their $1.15 million grant for home rehabilitation and streetscape work, while Tracy and Walnut Grove will each receive $600,000 for water system and facility improvements. Rural counties such as Kanabec and Lake of the Woods will each receive $575,000 to help low-income homeowners repair and maintain their houses.
The SCDP program continues to play a vital role in supporting Minnesota’s smaller communities by providing resources that help improve housing, strengthen local economies, and create safer environments. DEED is now accepting preliminary proposals for the next round of funding. Interested communities can learn more and apply through the SCDP website.
