Incentive Information

Please see our Business Subsidy Policy (PDF) for specifics on projects that may qualify for the City of Cottage Grove incentives. Additionally, projects must meet certain minimum wage requirements as located in section E of the Business Subsidy Policy. The current minimum wage for the State of Minnesota is located on the Minnesota Department of Labor and Industry website.

Cottage Grove

Tax Abatement

For projects meeting certain criteria, the City of Cottage Grove will consider property tax abatement. To be considered the business must complete an application with all information requested, which can be found at the bottom of the page. The application also must be accompanied by a $10,000 application fee that the City uses to do due diligence on the project.

Tax Increment Financing

The City of Cottage Grove often uses TIF for business park projects to offset development costs for businesses. To determine if a project is eligible applicants must complete the City's Business Assistance Application (PDF).

Minnesota Employment & Economic Development

Minnesota Investment Fund

The Minnesota Investment Fund Is a loan program through the Minnesota Department of Employment and Economic Development to provide loans to assist expanding businesses. Must meet minimum criteria for private investment, number of jobs created or retained, and wages paid.

Job Creation Fund

The Job Creation Fund is available to businesses engaged in:

  • Distribution
  • Manufacturing
  • Technology-related industries
  • Warehousing
  • Other eligible activities

Companies must work with the local government (city, county, or township) where a project is located to apply to DEED to receive designation as a Job Creation Fund business.

Minnesota Job Skills Partnership

The Minnesota Job Skills Partnership focuses on providing training for both new and existing employees of participating businesses. Businesses must partner with an accredited Minnesota educational institution. Grants up to $400,000 are awarded to educational institutions to develop and deliver training specific to the business needs.

Minnesota Data Center Sales Tax Incentive

The Minnesota Data Center Sales Tax Incentive is for companies that build data or network operation centers of at least 25,000 square feet and invest $30 million in the first four years qualify for tax breaks. Qualifying projects receive sales tax exemptions for 20 years on:

  • Computers and servers
  • Cooling and energy equipment
  • Energy use
  • Software

Xcel Energy

Business Incentives

Commercial and industrial customers may qualify for a variety of incentives from Xcel Energy, including:

For more information on the incentives, please contact Patrice Meger, Corporate Economic Development Manager, at 612-370-3531 or

Property Assessed Clean Energy (PACE) Financing

Property Assessed Clean Energy (PACE) Financing helps businesses, nonprofit, multi-family housing, and more in making their building energy efficient or add renewable energy. Provides low-cost long term financing. As a result, there is less reliance on credit and the assessment stays with the property instead of the owner.