Services: Incentive and Financial Resource Programs

Contact: Adam Fulton, Director, Planning and Economic Development

Address: 411 W 1st St., Room 208 , Duluth, MN 55802

Phone: 218.730.5325




The 1200 Fund provides incentive loans for business expansions and relocations within the City of Duluth, which will create jobs in Duluth. Loans will be made to eligible businesses to create the inducement necessary to structure financial packages.

General Loan Program

Loan Amounts: maximum of $500,000.

Eligible Applicants: This program is directed toward existing businesses, which have been in operation three or more years. New business start-ups are not normally eligible.

Other Funding Required: Typically a minimum ratio of two private dollars to one 1200 Fund dollar will apply. A bank loan will be required for an amount at least equal to the 1200 Fund Loan. Personal guarantees may be required for privately held corporations.

Other Special Requirements: Loans may not exceed $10,000 per job created. These uses must be located or be willing to locate in the City of Duluth.

Allowable Use of Proceeds: Low interest financing for up to 1/3 of the total cost of the project is available to service (non-personal and non-retail), wholesale, and manufacturing uses.

Term of Loan: This program provides fixed rate financing for fixed assets for a term of up to 17 years, machinery and equipment for a term of up to seven years and working capital for a term of up to five years.

Interest Rate: The interest rate varies. Normally fixed, loans approved to date have been between 3% and 8%.

Advance Loan Program

The Advance West Pilot Loan Program provides gap financing for Duluth businesses within the 55806 and 55807 zip codes acquiring a building and making improvements to open a new business.

Loan amount: maxmium of $50,000

Term of loan: Up to 17 years

Other special requirements: Unlike the General Loan Program, there is no requirement related to creation or retention of jobs. The building must be owned by the new business owner.

Loan forgiveness: Up to 50% of the loan may be forgiven if two full-time or full-time equivalent jobs are created on the site within two years.

Pay for Performance Incentive Loan Program

The Pay for Performance Incentive Loan program provides gap financing for manufacturing and high tech services businesses starting up or expanding within Duluth city limits.

Loan amount: maximum of $500,000

Term of loan: 17 years

Loan forgiveness: $5,000 forgiven for each full-time job created paying a salary that exceeds $50,000; forgiveness limited to 50% of the loan.

Other requirements: must create a minimum of eight new jobs with wages in excess of $50,000 annually, plus benefits.

The Duluth 1200 Fund serves the City of Duluth.