State Policies

Minnesota State Policies

Minnesota DEED Vocational Rehabilitation Services  

Policy Summary on Self-Employment:

Minnesota VRS offers technical assistance and consultation services to support individuals pursuing self-employment. Assistance is given to individuals whose self-employment goal aligns with their strengths, resources, capabilities, and informed choice and will allow them to achieve competitive integrated employment. VRS defines self-employment as a small business, or “an entity whereby an individual earns their livelihood directly from the sale of their goods or services rather than as the employee of another.” VRS does not support businesses which are in violation of federal or state laws, are speculative or high-risk business ventures, or hobbies (i.e., businesses that do not produce income).

Before receiving support, an individual undergoes an assessment designed to evaluate their capacity for self-employment. If self-employment is a deemed a feasible vocational goal, the individual is referred to small business development resources, who help them develop their business idea. Self-employment proposals cannot be included on an individual’s employment plan until an agency Small Business Development Specialist has been consulted. 

To receive start-up or stabilization funding, the individual must create and submit a business plan to the agency. If needed, supports are provided to assist with the development of the plan. The individual’s business plan must contain a detailed description of the business, financial data, a marketing analysis, a description of the individual’s relevant expertise and skills, any licensing or zoning requirements, a list of anticipated risks, and an implementation or stabilization schedule that includes the business start-up or stabilization costs. 

Business plans with a total cost below Minnesota’s Authority for Local Purchase (ALP) level must be deemed viable by a VRS Small Business Development Specialist, a state or nationally chartered lending institution, or a Micro-Enterprise program. Plans with a total cost above the ALP can only be deemed viable by the latter two. The lending institution or Micro-Enterprise program reviewing the business plan cannot be affiliated with anyone who assisted in the creation of the plan. 

VRS funding of start-up or stabilization costs are restricted by the small business fee schedule described in the Vocational Rehabilitation Rule; the business fee schedule is updated every year. The costs of any technology or training needed to accommodate the individual’s disability are not counted in the business fee schedule. Individuals whose gross family income is higher than Minnesota's consumer financial participation threshold must pay for a portion of the VR services they receive. The required payment is equivalent to the percentage by which their income exceeds the participation threshold (e.g., an individual with a gross income 10% higher than the threshold would pay 10% of the cost of the services provided). An individual can obtain self-employment services from in-state or out-of-state providers, but VR does not cover costs exceeding those charged by in-state providers. 

Case closure is determined on an individual basis. In all cases, a VRS Small Business Development Specialist must be consulted before closure occurs. 

Minnesota Administrative Rules:

Minnesota Policy Manual: