EDA eyes business incubator program

Elk River Star News

After seeing how it works in Stewartville, the Economic Development Authority is considering bringing a business incubator program to Elk River.

The program would provide rent assistance to allow home-based businesses to move into a vacant commercial property, serving two purposes — filling that empty space and allowing a small business to grow.

“There’s more ways for them to get flushed out of their garage and into retail space now, but it’s another incentive and it’s a cheap incentive,” Economic Development Authority member Bryan Provo said. “It’s one more bobber we have out there.”

It’s not the first business incubation program that’s been in Elk River. A similar, past program helped the Cymbet Corporation, an industrial equipment supplier.

“We may not find the next Google or Facebook by doing this, but if you get a few more companies a year into marketing space where they can go, maybe one out of 20 are going to skyrocket and that’s their springboard,” Provo said. “It’s a shot. I think it’s a good idea, it’s something innovative and we’re not targeting those people currently with any of those dollars.”

In addition to the rent subsidy, which would be for 18 months, the business owner would be required to take entrepreneurship classes. The business would also be required to stay in Elk River for three consecutive years, including the 18 months.

The money for the program could come from Economic Development Authority reserve funds or from grant funding. Stewartville’s program had $30,000 in funding.

“You can start small,” Provo said. “It’s a small investment and it’s something different. I like it.”

Businesses that apply would be reviewed by city staff and then a joint finance committee before final action by the Economic Development Authority. Businesses that don’t meet the requirements would have to repay the subsidies.

“I want more information and maybe get laser focused on who we’re targeting,” Provo said.

Currently, Elk River has 26 vacant commercial spaces.

The next steps would be to draft a policy, set a budget and advertise the program. The program could be in effect as soon as 2019.