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Tackling the ‘opportunity gap’: Hutchinson foundation takes on child poverty in southwestern Minnesota

About 11,000 children in southwestern Minnesota live in poverty, according to 2015 data. That’s one in six children.

photo of southwest initiative foundation headquarters building
The Southwest Initiative Foundation provides a variety of economic development assistance, largely through loans and grants, to organizations in the region.
Courtesy of the Southwest Initiative Foundation

MARSHALL, Minnesota — In early November, as a light snow fell across southwestern Minnesota, more than 400 people filled the basketball arena at Southwest Minnesota State University for a daylong summit about childhood poverty in this part of the state.

The numbers are stark. According to the Southwest Initiative Foundation (SWIF), the nonprofit that organized the forum, about 11,000 children in an 18-county region plus two Native American reservations live in poverty. That’s one in six children. Reducing that number – and helping to create a promising future for young people – was the aim of the event, dubbed the Grow Our Own Summit. (A SWIF-commissioned report on youth poverty, published in February, can be found here).

Speakers included Nisha Patel, a former Obama administration official who works as an executive at Robin Hood, an antipoverty nonprofit in New York, and Vanessa Goodthunder, a former aide to Gov. Mark Dayton who runs Minnesota’s first Dakota immersion Head Start program on the Lower Sioux Indian Community near Morton.

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SWIF is one of six Minnesota Initiative Foundations that were created by the McKnight Foundation in 1986 in response to an economic recession fueled by the 1980s farm crisis. Today, the foundation provides a variety of economic development assistance, largely through loans and grants, to organizations in the region. For instance, SWIF has provided loans for a historic theater in Jackson and a veterinary clinic in Appleton and grants for youth programs on the Lower Sioux Indian Community and homelessness initiatives in Kandiyohi County. During its past fiscal year, the agency made 41 loans totaling $2.1 million and 568 grants totaling $1.6 million.

The agency turned its attention to childhood poverty a few years ago and held its first Grow Our Own Summit in 2016.

In her closing remarks at this year’s summit, Diana Anderson, the president and chief executive of SWIF, said economic development, philanthropy and social support are all needed in the fight against youth poverty. “I hope you will find staying power in the larger community that is growing around our kids,” she told the crowd.

A few days later, MinnPost caught up with Anderson at the foundation’s headquarters in Hutchinson, a city of 14,000 people in McLeod County, for a discussion about the summit, the agency’s work and the state of rural philanthropy.

The following conversation has been edited for clarity and brevity:

MinnPost: What is the mission of the Southwest Initiative Foundation?

Diana Anderson: For our first 32 years, we had broad engagement around economic development. Business financing, in the way of gap financing, working with banks and businesses to fill a gap in their plans to start a business or expand a business. We’ve done entrepreneurship training and support. We have an SBA micro-enterprise loan program, so that’s Small Business Administration Funds that we re-lend. We are an intermediary, so we hold them for a very low interest rate and then we re-lend them to small businesses, and that comes with a lot of technical assistance. That’s really how we have contributed to the economic development side of our region. And then, certainly, we have grant-making that we do to support nonprofit organizations and that has been prioritized the last number of years around early childhood and also around productive aging.

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MP: Talk about the Grow Our Own Summit. How did that come to be and what do you hope it will accomplish?

DA: In 2015, when we were doing strategic planning, we really started to think about, “What do we want our region to look like 30 years from now?” So, we’ve had a vision that was about “a place where all people want to live and work.” We changed that up a little bit – our new vision is, “Southwest Minnesota is a place where all people thrive.” We started looking at the data, and the data would suggest that without some interventions, there are children today that will struggle to thrive because they’re growing up in poverty. According to [Harvard political scientist Robert] Putnam, it’s become more of a divide in terms of getting access to opportunities than it might have been 30 or 40 years ago. There was this sense in the community [back then] that all kids were our kids, and that’s changed. Putnam’s research would indicate that, increasingly, we think more in terms of our kids as our children and grandchildren, those children that are in our immediate sphere, rather than the broader community. When we looked at the data back in 2015, there were one in six kids in southwest Minnesota living in poverty; that’s about 11,000 children. Just thinking about our future workforce, the vitality of our communities, who’s choosing to stay and who’s choosing to leave our communities – all of that weighed into the decision to say the highest and best use of our resources and our brand and our skill set over the next 10 years would be to raise awareness of that opportunity gap and then to work with communities on the local solutions that will close it.

photo of speaker applauding from lectern
Courtesy of the Southwest Initiative Foundation
Diana Anderson, president and chief executive of the Southwest Initiative Foundation, which is based in Hutchinson, speaks at the initiative’s Grow Our Own Summit, held on Nov.8 at Southwest Minnesota State University in Marshall.
MP: In your view, what are some of the major economic needs in southwestern Minnesota?

DA: There’s certainly this need for child care. It’s at crisis proportions, so proactively we’re using our resources and staff to work on that in communities across the region. We’re being proactive around growing businesses — and especially diverse entrepreneurship. When first-generation families get to our communities and can learn the language, get a good job, potentially start a business, they just fast-track their ability to homeownership and building some savings and things like that – things that really support their children, as well. [At a recent Federal Reserve event], we were just talking about the wealth disparities right now between immigrants who are coming with graduate degrees – likely to work in research and development at the Schwan’s Food Company (in Marshall) or the MinnWest Technology Campus (in Willmar) – versus refugees who are coming to the country with a language barrier and perhaps not a high-school degree. There’s a huge gap there. But we know, as was the case a hundred years ago, when there were waves of immigrants coming to Minnesota from Germany and Sweden and Norway, that that gap closes over time. So, how do you support those new immigrants to get them started on that track? It starts with a good income. Then, it’s about building assets; it’s about being able to save; it’s about the possibility of purchasing a home; it’s about ensuring that your children get connected to a great education and can find their way in a new country.

MP: The Southwest Initiative Foundation has been around for 30 years. It was a different place 30 years ago in Minnesota, so what were the things happening then that led to its creation?

DA: In 1984, the rural economy was collapsing under the weight of the farm crisis, the timber crisis, the mining crisis. So, really, from border to border there were significant issues in our rural economies. The strategy (of the McKnight Foundation) was to create these six regional initiative funds – which is what we were called when we started – that could take a regional approach to problem-solving because our regions are so different. We’re not the North Shore, so it’s just going to be different [here]. What works in the Duluth-Superior, in the Arrowhead area, is going to be very different from what works here in southwest Minnesota. It was a regional approach that gave each of the six initiative funds some seed money and said, “Now go and figure it out.” Because it was the economy of our rural communities that (was) driving the need, we’ve always had an emphasis on economic development. It’s just in our DNA.

Marshall and Hutchinson, Minnesota
MP: How would you characterize the state of rural philanthropy?

DA: We have a very vibrant philanthropy community. We serve as the back office for 26 community funds here in southwest Minnesota. Around 2000, [we thought], “OK, we’ve got that economic development thing down; we’re firing on all cylinders when it comes to grant-making and working with nonprofits; now, what are we going to do on capturing community wealth and ensuring that it stays in our communities?”

It’s very much a two-prong approach. We absolutely want funders in Minnesota to know about the needs and issues in Greater Minnesota. It’s actually a very close network. Our community impact director (Nancy Fasching), who oversees our grant-making and early childhood and productive aging programs, belongs to a statewide network called Friends in the Field, and it’s [made up of] foundations from across the state that are all involved in funding rural [initiatives]. It would be McKnight and the Otto Bremer (Trust), Bush Foundation, the initiative foundations, community foundations, really getting together to talk about, “So, what are you seeing in your rural communities? What are the best ideas? What are the needs?” I think we’re trying to be, as a philanthropy community, more intentional about how we work together in rural [areas]. How can we leverage each other’s resources or connections to be stronger in what we invest in in rural communities?

MP: The conventional narrative about rural Minnesota is that it is kind of a stagnating place – even a dying place in some areas. What is your perspective on that narrative?

DA: It’s certainly a narrative that we would hope to see change. Within the philanthropy community there’s been a focus on what we call One Minnesota – kind of dovetailing on (Gov.-elect Tim Walz’s) campaign of One Minnesota. How do we bridge that divide that is really rooted in perception and narrative – not in fact or reality. Perhaps there are times when those of us here in rural [areas] can sort of get sucked into that narrative, because things aren’t always easy. There’s definitely change taking place in our communities. There’re also these assets in terms of a strong spirit of collaboration. We really do need each other and I think there is a real understanding of that. People come together and work together and the idea of great public schools – all the things that folks at the Bill and Melinda Gates Foundation would say are assets in terms of small class size and teacher [-student] ratios and those kinds of things. Safe and caring neighborhoods. Hands down, our communities in rural Minnesota are extremely safe.

And so they’re growing in ways that certainly are different in terms of the changing demographics. But, in communities where that change is embraced, and viewed as opportunity and [where] the newcomers are seen as an asset, it’s imagining your community in a different way. It’s having to say, “We may not be able to hang on to what we always had. Main Street might look different. We might not have everything that we used to have, but we can have something different.” Really imagining what the future could look like.

This report was made possible by a grant from the Otto Bremer Trust. MinnPost’s donors, foundation funders, and corporate sponsors support our work in the belief that promoting greater civic engagement and informed discourse is the surest path to a better Minnesota. They play no role in guiding the journalism produced by MinnPost.