IQ Magazine - Spring 2009

SPRING 2009

INITIATIVE QUARTERLY

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IQ Magazine

SPRING 09

Contents 14

16

ABOUT THE COVER: We honor six stars with our special issue and April 17th event, “A Constellation of Community Service.” Unlock the mystery at www.ifound.org/awards.

18 OUR MISSION:

Unlock the power of central Minnesota people to build and sustain healthy communities.

INITIATIVE FOUNDATION GOALS:

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–Strengthen Economic Opportunity –Preserve Key Places and Natural Resources –Support Children, Youth, and Families –Build Organizational Effectiveness –Encourage the Spirit of Giving

I N I T I AT I V E AWA R D S – S I X W H O S H I N E

D E PA R T M E N T S

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4

Kathy’s Note Economics

6

The New Buzzword ‘Business Succession Planning’ Earns its Hype as High Priority

8

Behind the Name Favored Funds Change Gifts and Givers

10

Small Towns, Big Dreams Local Donors Meet Local Needs with Community Foundations

40

Keynotes Initiative Foundation Spring 09 Newsletter

44

Guest Editorial Contrasting Crisis

16

Outstanding Leadership Glen Palm

Outstanding Nonprofit Central Minnesota Habitat for Humanity

18 20

Outstanding Youth Jennifer Schmidt

Outstanding Enterprise LINDAR Corporation

22

Outstanding Green Venture

24

Outstanding Community

30

Initiative Foundation Regional Report

Rural Renewable Energy Alliance

Pine City

SPRING 09

3

A Visit With a Friend

Kathy’s Note

Economics Dear Friends,

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Guiding You To and Through Retirement

We phased out the beef cattle operation, later the hogs, and later the crops. The auction took care of the equipment. The dream of owning a family farm faded along with the optimism in the eyes of my husband, Neal, and his family.

It was the mid-1980s, and we were in the middle of an economic recession that hit the rural areas hard.

At that time, it was the latest, worst crisis since the Great Depression.

Economists say the current one is deeper and more durable. If you’re like most Minnesotans, you’re tired of the gloom and doom. You’re finding that positive news is hard to come by, and that fear and depression are available on every street corner.

Well, this magazine has a different story to tell.

First, you’ll be pleased to know that your Initiative Foundation isn’t watching from the sidelines. We’ve tabbed more than $650,000 in grants for projects that speed economic recovery. We’re creating and securing quality jobs with $2.4 million in business loans.

Our priorities are to respond, partner, and plan, and we’re confident that we can make a regional difference. Check out our annual report on page 30.

You’ll also get a lift when you read about the six regional winners of our 2009 Initiative Awards, the shining stars who have pierced the darkness to strengthen our community and economy. We invite you to celebrate this “Constellation of Community Service” with 500 regional leaders at our April 17th awards event in St. Cloud. See page 26.

We hope this news and these stories help to brighten your outlook for 2009, as we prepare an IQ slate that focuses exclusively on economic hope, opportunity, and solutions.

Remember, a crisis is a terrible thing to waste. The 1980s adversity propelled Neal into a rewarding career in law enforcement, and it gave central Minnesota a little nudge called the Initiative Foundation. There’s no telling what it will do for you.

215 Park Avenue South, Suite 100, St. Cloud

Enjoy the magazine!

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Investment Representatives are registered representatives of Fintegra.

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Initiative Quarterly Magazine Volume 7, Spring 2009

INITIATIVE FOUNDATION Executive Editor & Director of Communications | Matt Kilian Grants & Communications Specialist | Anita Hollenhorst PUBLISHERS Evergreen Press | Chip & Jean Borkenhagen EDITORIAL Editorial Director | Jodi Schwen Managing Editor | Tenlee Lund Staff Writer | Dawn Zimmerman Staff Writer | Sarah Colburn ART Art Director | Andrea Baumann Senior Graphic Designer | Bob Wallenius Graphic Designer | Brad Raymond Production Manager | Bryan Petersen Lead Photographer | John Linn ADVERTISING / SUBSCRIPTIONS Business & Advertising Director | Brian Lehman Advertising Manager | Kristin Rothstein Advertising Manager | Lois Head Advertiser Services | Mary Savage Subscriber Services | Anita Hollenhorst IQ EDITORIAL BOARD Initiative Foundation President | Kathy Gaalswyk Program Mgr. for Community Development | Dan Frank VP for Donor Services | Curt Hanson Sr. Program Mgr. for Organizational Effectiveness | Cathy Hartle Sr. Program Mgr. for Planning & Preservation | Don Hickman Program Assistant for Grants & Training | Tricia Holig VP for Finance & Operations | Lynn Houle-Bushinger Sr. Program Mgr. for Children, Youth & Families | Linda Kaufmann Donor Services Officer | Mark Lease Executive Assistant | MaryAnn Lindell VP for Economic Opportunity | Randy Olson

ERICKSON 405 First Street SE Little Falls, MN 56345 320.632.9255 | www.ifound.org

Published in partnership with Evergreen Press, IQ Magazine unlocks the power of central Minnesota leaders to understand www.EvergreenPress.net and take action on regional issues.

Printed with Soy-Based Ink on Recycled Paper at Continental Press, Inc.

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SPRING 09

5

The New Buzzword ‘Business Succession Planning’ Earns its Hype as High Priority

By Tenlee Lund | Photo by John Linn

T

wenty-five years ago, Jack and Betty Thomas attended a beekeeping tradeshow and left buzzing about business opportunities.

They returned to Hackensack, Minnesota, to form an upstart beekeeping supply company, Mann Lake Ltd., with aggressive marketing, new products, and an emphasis on customer service. Within four years, they supplanted the industry leader and grew to become today’s worldwide supplier of honey bee feed, medications, and equipment.

As the Thomases approach retirement, they find themselves thinking about the future of their company, their community, and 90 fulltime employees. As thousands of Baby Boomer entrepreneurs look to make similar life transitions, succession planning is fast becoming everyone’s business.

“We have all these families that rely on Mann Lake, so we need to make responsible decisions to maintain the company, should Jack and I not be around,” said Betty Thomas, the company’s president. “You have to think beyond yourself. You have to think about your employees.”

Ten years ago they started investigating an employee stock option plan. They have since named four managers to take over the day-to-day direction of the company, and a governing board of directors.

Mann Lake’s succession plan covers all the essentials, as defined by Pat Edeburn, partner with Granite Equity Partners in St. Cloud, Minnesota.

“Like any good process, you start with the end in mind,” he said. “Earlier planning is better because it gives the owners more options, and the succession plan becomes a reflection of the owner’s values.

“All businesses will change ownership or they’ll go out of business.

The situation today is made more acute by the sheer demographics, since many business owners are approaching the ages of 60 and 65.”

And the future of many central Minnesota communities may hang in the balance. According to Curt Hanson, Initiative Foundation vice president for donor services, many of the 161 cities in the foundation’s 14-county service area depend on just a few local employers. He said that more than 600 central Minnesota manufacturing companies, which employ 11,500 workers, currently face succession issues.

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PLAN BEE: Succession planning allowed Jack and Betty Thomas to decide the future of their beekeeping supply company. Less than one in four firms have such plans, placing employees and communities at risk.

The current statistics are grim: fewer than one in four of those businesses have a succession plan in place; less than 25 percent of independently owned businesses successfully transition from the first generation to the second, and, of those, a mere 14 percent survive beyond that.

As part of their succession plan, the Thomases decided to achieve a personal goal. By taking advantage of the Initiative Foundation’s donor services, they will eventually create and fund a state-of-the-art animal care facility in Hackensack.

“You have to think beyond yourself. You have to think about your employees.”

By transferring ownership of a large gift of land to the foundation, the Thomases realize tax benefits while maintaining lifetime use of the property. Upon their passing, the proceeds from the property’s sale will fund the animal shelter.

“Business succession planning often intertwines with personal estate planning,” said Mark Lease, Initiative Foundation donor services officer.

“The Thomases created a fund to satisfy a life’s dream, but more importantly, they created a plan that respects their employees and their community.”

There are several resources available to help businesses negotiate succession issues. These include a company’s current professional advisors, St. Cloud’s Anderson Center for Management and Business Development, and the Initiative Foundation (www.ifound.org/donorcenter). According to the Thomases, the most important step is to get started.

“Although Betty and I don’t see ourselves separating completely from the company, we’re ready to put our energies into other areas,” Jack Thomas said. “When you have a company the size of Mann Lake, you have to make that company immortal.” IQ

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Behind the Name Favored Funds Change Gifts and Givers FAMILY CIRCLE: The Andersons’ fund honors their business and unites their family around giving back. Advised funds are growing in U.S. popularity.

By Kayleen Larson | Photo by Jim Altobell

C

entral Minnesota has been good to Anderson Brothers ues. “The Anderson family and the Anderson Brothers’ employees have a Construction. That’s why Jim and Linnea Anderson commitment to the communities we live and work in. We’ve funded proapproached the Initiative Foundation about returning the grams that range from helping seniors remain in their homes to helping favor, using a charitable vehicle that honors their company, children with reading programs.” unites their family, and strengthens their communities.

Each spring, the Anderson family sits down with the Initiative Serving an area from Little Falls to Park Rapids, Anderson Brothers Foundation to review grant requests. has been the premier builder of asphalt roads, driveways, parking lots, and “The foundation does an excellent job of presenting the requests and tennis courts since 1940. In 2004, the Andersons worked with the Initiative ensuring that they fit the guidelines,” Curtis said. “It brings efficiency to the Foundation to establish the Anderson Brothers Family Fund with an iniprocess, as well as familiarity with the needs that exist in the community.” tial donation of $100,000. Their donorDonor-advised funds, like the Anderson advised fund has doubled in value and providBrothers Family Fund, have become increased more than $88,000 in grants to support ingly popular. The national Council on children and families, preserve the environFoundations reported that grants made from ment, and strengthen the regional economy. donor-advised funds account for more than Jim Anderson said they established the Find a foundation. half of the total number of grants issued by all Meet with a foundation to discuss goals, fund to unite his company’s legacy of comNorth American community foundations. tax advantages, services and fees. munity service with his family’s tradition of Curt Hanson, the foundation’s vice presgenerosity. He and Linnea engage their ident for donor services, has also seen a rising Name your passion. children and grandchildren in giving back. interest in family, business, and memorial “We wanted our family to get a better Consider what you care about, the charities you’ll funds over the past five years. He credits the support, and the geographic area you’ll serve. understanding of philanthropy and the compopularity to a desire for involvement in givpany’s giving,” he added. “We wanted to ing while honoring family or business names.

Name your fund. increase our awareness of community needs “We are so well-known for our economic Honor your family, your business, or a loved one. and the company’s role in addressing them.” development and leadership programs that “Donor-advised” means the donors who people forget that one of our primary goals is Make a gift. create the fund are involved in recommending to help donors realize the full benefits of their Plan on $20,000 to start your fund. Gifts of appreciated which community programs and services will generosity,” Hanson said. stock or real estate have unique tax advantages. receive support. A donor-advised fund is an Terry Curtis advocates donor-advised endowment (only the earnings are spent) that funds for those who want to formalize and Make a difference is created in partnership with a foundation, streamline their charitable-giving activities.

When your fund has accrued earnings, you’ll begin which owns and manages the fund. The “Until you go through the process and the rewarding process of exploring needs, Initiative Foundation also provides accounthave the benefit of the foundation walking you awarding grants and seeing the impact. ing, marketing, and grant-screening services. through it, you’d be hard-pressed to find all Terry Curtis, Anderson Brothers’ director these organizations and needs on your own,” To learn more, visit the Initiative Foundation’s donor of business development and community relahe added. “A fund like ours makes it possible resource center at www.ifound.org/donorcenter. tions, said the fund fits the company’s core valto do so much more in the community.” IQ

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Steps to a Fund

SPRING 09

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Small Towns, Big Dreams Local Donors Meet Local Needs with Community Foundations

Tom Gahler

Greater Pine Area Endowment

Little Falls Area Foundation

Founded: 1994 Service Area: Pine City School District Endowment: $455,148 Total Grants: $252,997

Founded: 2000 Service Area: Morrison County area Endowment: $71,303 Total Grants: $15,050

MISSION > To provide financial resources to meet the long-term strategic needs of the greater Pine City area, focusing on economic and community development.

MISSION > To develop and strengthen community resources and to enhance the quality of life for individuals, families, and organizations in the Little Falls area.

Lori Kowalczyk

“Every community could benefit from its own foundation.”

“They are there to help us become successful.”

“Pine City is an ideal area for families, recreation, and business. We have lakes and trees, but we also have outstanding education and business opportunities, especially with our proximity to I-35 and the Twin Cities. All of these things make us a healthy community. Right now, we’re focused on economic development and the expansion of our high-tech industrial park.

“GPAE has been an integral part of our community, allowing residents to give back and see their charitable dollars working locally. Our grants have funded everything from youth projects to senior center activities to business development initiatives like a broadband fiber hub and technology incubator.

“Every community could benefit from its own foundation.

First, you need lots of advice and a wide range of active people involved—not just a small group. Our partnership with the Initiative Foundation meant that we didn’t have to re-create the wheel. Their professionalism and willingness to share in our challenges and success have helped us become what we are.”

–Tom Gahler, Board Chair

“Morrison County is a great place to call home, but it is also regarded as one of the most economically challenged counties in Minnesota. Our goal has always been to improve the ‘present’ for area residents as well as improve the future for youth in our community. In our area, having a foundation to direct local generosity to meet local needs is extremely important. We want to help people give back.

“Our grants have funded scholarships for graduates involved in community service as well as nursing. We also fill the funding gaps in community functions such as the Veterans Moving Wall and the Little Falls Youth Hockey Association’s ‘Skate for Free’ program.

“As more projects happen, more people are beginning to seek us out. We’re slowly but surely building our name recognition. The Initiative Foundation has been helpful in providing training to understand what we are and how we can best serve our community.

The best part of working with them is that the door is always open.

They are there to help us become successful.”

–Lori Kowalczyk, Board Chair

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In central Minnesota, community foundations aren’t reserved for large communities. Today, communities of all sizes are creating endowments that allow local donors to give back to the areas they love. The Initiative Foundation partners with community foundations to inspire leadership and generosity in four of central Minnesota’s great hometowns. We asked each board chair to give us the cafe-stool scoop about their area, their foundation, and what they’ve been up to lately…

Three Rivers Community Foundation

Staples Community Foundation Founded: 2000 Service Area: Staples-Motley School District Endowment: $336,747 Total Grants: $59,968

Founded: 1989 Service Area: ISD 728 (Elk River, Otsego, Rogers & Zimmerman) Endowment: $669,865 Total Grants: $291,042

Tim Rice

Nate Lilleodden

MISSION > To attract and develop community and philanthropic assets to enhance the quality of life for individuals and families in our service area.

“Starting a community foundation does make a difference.”

“They have given us perspective as we make decisions.”

“Successful communities need business owners, employees, citizens, and social clubs to take the initiative to be engaged and active to improve and enhance the community. The uniqueness of our community is our collaboration. We all work closely together on a great team.

“Private citizens may ask, ‘What can I really do?’ Our foundation provides an answer. Local generosity has helped fund grants to our food shelf, community signage, public transportation, youth activities, playground equipment, cultural events, veterans’ projects, and even a bog walk. We continue to be honored by our many annual contributions, which allow these grants to be awarded on an annual basis. Our awards banquet provides an opportunity to recognize this leadership and encourage others to become involved.

“Starting a community foundation does make a difference. If you commit time and energy, there will be an improvement and enhancement of your community, too.”

–Tim Rice, Board Chair

“Our foundation is a great resource to our community. As a metropolitan suburb, a large majority of our residents commute.

We provide an opportunity for local residents to give back to the community that they live in.

“We recognize the need for quality education for our youth as local employers struggle to hire and retain qualified employees. For the last few years, we have provided more than $20,000 in annual scholarships to students who intend to stay and work in our community. Our golf tournament and Community Leaders Recognition Event are helping to build our name recognition and credibility.

“Because of the Initiative Foundation, our board is able to focus on our mission and goals instead of spending a lot of time and energy running the daily operation. They have also provided creative ideas to build and operate our foundation, and given us perspective as we make decisions. Our intent is to continue to make an impact in the community each year.”

–Nate Lilleodden, Board Chair

SPRING 09

Photos by John Linn

MISSION > To develop and strengthen community resources and to enhance the quality of life for individuals, families, and organizations.

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two-year-old stands on tiptoes as her father nervously reads Dr. Suess’s, One Fish Two Fish Red Fish Blue Fish. The child claps her hands and kisses him over and over. As the glowing image fades to black, she asks her mother to replay the video. She hasn’t seen her father since he went to prison. Thanks to Glen Palm, there’s still a bond between them.

St. Cloud State University child and family education professor, Dr. Glen F. Palm, has dedicated himself to improving children’s lives through parent education and early childhood programs.

Over the past 25 years—initially, in a field largely comprised of women—he helped lead Minnesota’s early childhood revolution by involving more fathers. His goal: Change society by raising healthy children who are nurtured by effective parents and supported by caring communities.

Many children face daunting challenges to healthy development. One is parental incarceration, which deeply impacts children and often leads to a cycle of generational crime and violence. Since 1995, Glen has collabo-

fun and helps children see that adults find them fun to be with, Palm said.

“Glen Palm is a powerful voice for young children. He stands up for those who can’t speak for themselves,” said Linda Kaufmann, Initiative Foundation program manager for children, youth, and families. The Initiative Foundations have launched 86 statewide coalitions that help communities make early childhood care and education a priority. “Children growing up today will have brighter futures due to his leadership.”

Glen and other father advocates in Minnesota created a statewide educational organization for fatherhood professionals and policy makers. In 2002, the Minnesota Fathers and Families Network elected Palm as its first president. Executive Director Paul Masiarchin calls him a servant-leader whose quiet guidance has been a key strength.

“Glen has worked tirelessly,” Masiarachin said, “and not because of great monetary reward or public recognition. He is guided by passion.”

“We’re both passionate about the same field, and I have incredible

“Glen Palm is a powerful voice for our youngest children.

He stands up for those who can’t speak for themselves.” rated with the St. Cloud School District’s Early Childhood Family Education and the Minnesota Correctional Facility-St. Cloud to offer parenting classes for incarcerated fathers.

Inmates are videotaped as they read such classics as, Goodnight Moon, Curious George, and Green Eggs and Ham. Each DVD and book is mailed to the child, courtesy of the Minnesota Humanities Council.

“Glen has significant impact on our offenders,” said Warden Patt Adair. “Through his classes, offenders not only learn how to better parent their children, they gain insight into their own childhoods.”

In the 1950s, Glen and his two brothers grew up in Chicago’s Austin neighborhood, a working class Irish/Italian community. His father was selfeducated, a tool and die maker who molded himself into a plant manager, engineer, and systems designer. Glen’s mother was a part-time waitress who volunteered at church, school, Cub Scouts, and as an election judge. Their parenting shaped Glen’s belief in social responsibility and education.

Glen met his wife, Jane Ellison, at a child development class in Chicago. They moved here in 1975, as Glen was completing his Ph.D. at the University of Minnesota. In 1983, the family moved to St. Cloud.

While his three children were young, Palm helped to plan “Super Saturdays for Dads” events, which continue today. His kids joined a growing number of preschoolers spending more time with their fathers.

Activities include singing Raffi’s, “Bumping Up and Down in My Little Red Wagon,” while bouncing on their father’s laps and “fixing” broken wagons with pretend hammers and pliers. Dad’s-style play promotes nurturing

respect for his knowledge, ethics and values,” says Jane Ellison, herself a parent educator, and an infant and early childhood mental health specialist.

With Ellison as project manager, the couple is collaborating to lead the Greater St. Cloud Area Thrive Initiative, another Initiative Foundation coalition to support the mental health of young children.

Glen believes the earlier an intervention can occur in a child’s life, the better the outcome. To this end, he has helped St. Cloud State to graduate more than 400 licensed parent educators in Minnesota, the only state to offer such a license. He has also been an active leader in several state and national parent and family education organizations.

“Glen looks for solutions,” said Dr. Deborah Campbell, a former Palm student who now directs the Sauk Rapids-Rice Early Childhood Family Education (ECFE). “He is very inclusive, gathering people together to share perspectives and taking a collaborative approach.”

A humble, tenderhearted “revolutionary” who has championed the cause of children and their parents for nearly three decades, Dr. Glen Palm has improved the lives of countless young children by focusing on father-child relationships, community initiatives for fathers, and preparing child and family educators.

“Sometimes,” said Palm, “a person acts because it feels like the right thing to do.”

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t Central Minnesota Habitat for Humanity, Marianne Miller is a symbol of hope for hard-working families who can’t quite reach the American Dream. And for those who had it and lost it.

Her story begins with a migraine headache, in her middle-class life in a Twin Cities home. But it wasn’t a headache. A massive brain aneurysm left her legally blind, hearing-impaired, and unable to walk or talk due to debilitating weakness on her left side. Her husband left her, too.

After months and a miracle recovery, she started over again in St. Cloud with new disabilities, mounting bills, and three children to raise on her own. She found a low-income apartment near her sister, in a neighborhood where she often heard gunshots and witnessed drug activity.

“I didn’t know if we’d ever be able to have a real home again,” she said.

Her sister pushed her to attend one of Central Minnesota Habitat for Humanity’s informational meetings in 2005, where she began a three-year process of becoming a homeowner again.

“Many people don’t understand the partnership we enter into with families,” said Bruce Johnson, Habitat for Humanity executive director.

“The expectations are high. We don’t give hand-outs, we give hand-ups.”

Habitat doesn’t give away homes. Out of hundreds of applicants, Habitat selects only a few qualified candidates each year. At minimum, they must currently live in substandard housing, meet an income requirement, demonstrate a solid employment history, donate 200 hours of sweat equity, and attend homeownership education classes. After homes are built, owners must also make mortgage and utility payments.

Miller remembers the day she walked to the mailbox and saw a letter from Habitat. “I was shaking,” she said. “It said, ‘Congratulations, you’re accepted.’ I didn’t believe that it would ever happen for us.”

Johnson said homeownership is key to breaking the poverty cycle.

“When parents raise their families in a decent home, children have the opportunity to grow instead of wondering if they’re going to be cold, have a bed to sleep in, or have enough food,” he added. “It allows them to have hope, faith, and trust in their lives.”

Another goal of Habitat is to build the skills of its homeowners— from financial literacy to hanging drywall—infusing families with pride and the confidence to handle maintenance and repairs. Projects bring together the skills and generosity of hundreds of volunteers. “We link those in need with those who can help,” Johnson said.

Miller and her family logged hundreds of volunteer hours for Habitat, and they still do. “My kids laid sod at one of the homes, served lunch to volunteers, and helped me make blankets for one of the local shelters.”

With economic challenges of rising unemployment and home foreclosures, Central Minnesota Habitat for Humanity is ramping up efforts to help meet the growing need for affordable housing. Their upward climb began in 2004, when board and senior staff were selected to the

Initiative Foundation’s Healthy Organizations Partnership (HOP) program. The HOP program trains nonprofit leaders to run effective organizations that achieve greater results in their communities.

Through the program, Habitat created a five-year strategic plan and set a goal Marianne Miller and family. of increasing construction from about three homes per year to at least ten by 2010. Eight homes were built in 2008.

“They are an inspiration to those of us who believe in the power of committed volunteers, and that change is best achieved by helping people to help themselves.”

“They are an inspiration to those of us who believe in the power of committed volunteers, and that change is best achieved by helping people to help themselves,” said Cathy Hartle, Initiative Foundation senior program manager for organizational effectiveness. “They used our leadership training to move their organization to a new level.”

In fall 2008, Miller and her three children crossed the threshold into their new home. The site was selected for its location on a bus route and within walking distance to work for Marianne, who can no longer drive.

“It’s a dream come true and well worth the wait,” Miller said. “If it wasn’t for Central Minnesota Habitat for Humanity, I’d still be in that apartment and still be afraid for my children’s safety.”

The Millers’ home is also the first “green” home built by Central Minnesota Habitat for Humanity. The Central Minnesota Builders Association donated high-efficiency, low-impact building materials for the demonstration project, which was featured at a building expo and used to train other builders. Leaders hope that incorporating such elements into future Habitat homes will keep utility bills affordable.

Since 1989, Central Minnesota Habitat for Humanity has helped 54 families move into safe, affordable housing. Remarkably, 52 of those 54 families still live in their Habitat homes—many remain active volunteers.

“My family and I plan to always give back to Habitat for Humanity for what they’ve done for us,” Miller said.

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A

t age 15, Jenny Schmidt walked into the St. Cloud Hospital and volunteered.

No big deal, she thought at the time. And it really wasn’t. Not at first, anyway. Jennifer was interested in going to college for medicine, so why not test the waters?

After the standard volunteer training, Jenny’s hospital supervisor issued her a red polo shirt and assigned her to the gift shop and rehabilitation center. It was there, among the recovering victims of stroke, head, and spinal cord injuries—and among their private stories of heartbreak and inspiration—that she found something unexpected.

Her passion.

For medicine, perhaps, but even more so for volunteering.

“I was helping patients decorate holiday cookies,” she said, “and they were so grateful and thankful that I was there. They kept telling me how much they appreciated my help. They talked to me and told me about their families.”

While there, she saw firsthand how small things like filling water pitchers, delivering flowers, or escorting patient families can serve as a healing act. “I realized that I was making a real difference in someone’s life just by being there,” Jennifer said.

“Here is a young woman who breaks through the popular mindset that today’s youth are heading in the wrong direction. She sees the world through a lens of hope, with unlimited opportunities to improve lives.”

She eventually became a Junior Volunteer team leader and vice president, leading and directing St. Cloud Hospital’s other youth volunteers.

What started as a way to explore a career in medicine grew to be a way of life for Jennifer Schmidt. Volunteering became a fulfilling compulsion, an outlet for a buoyant personality filled with hope and youthful optimism.

Simply put, she connected with people in need.

“We ask junior volunteers to commit to serving at least 50 hours before they leave the program,” said Sonia Dickrell, St. Cloud Hospital’s volunteer program assistant. “Jennifer worked more than a thousand volunteer hours. She has an amazing inner drive.”

That inner drive and desire to help those in need has propelled Jennifer to serve in other ways as well. She served on her high school youth service group, helped raise money for Hurricane Katrina victims and Kids

Against Hunger, and volunteered at the Veterans Administration Hospital. She participated in the Community Earth Day clean up, prepared meals for homeless people, wrapped Christmas presents for needy children, and more.

“Jennifer has a natural ability for participatory leadership,” said Kevin LaNave, director of the Center for Service-Learning and Social Change in St. Cloud. “She is truly interested in finding out what everyone has to say and is very attentive to people and their ideas. She creates a space that allows groups to explore ideas.”

LaNave first met Jennifer when she participated in the center’s annual Social Justice Conference, funded by grants from the Initiative Foundation. The youth-led conference educates hundreds of junior and senior high school students about current social issues, and then provides leadership training and encouragement to spark volunteer projects that take them from the classroom to the front lines.

“At the conference, the students divided into groups based on issues they identified as important,” said LaNave. “Jennifer sat in on a group on hunger. They were quiet kids, but they came up with a brilliant idea for a fundraiser.” And Jennifer, said LaNave, was at the heart of making it happen.

At a dance, she and her peers helped raise hundreds of dollars for Kids Against Hunger, funding the local packaging and distribution of highnutrient foods for African children.

“Here is a young woman who breaks through the popular mindset that today’s youth are heading in the wrong direction,” said Jana Shogren, Initiative Foundation children, youth and families specialist.

“She sees the world through a lens of hope, with unlimited opportunities to improve lives.”

Ask about her role as a leader, and Jennifer talks instead about the importance of inclusion. “I just try to include everyone,” she said. “I never tell people what to do. I ask them what they need to do the job and then let them be responsible.”

LaNave said young people like Jennifer, who can think creatively and believe they can make a difference, have enormous capacity to contribute in their communities. They just need the opportunity.

“Two mistakes we make with young people are that we teach them that because they aren’t adults they have nothing to contribute,” LaNave said. “We also tend to control and direct, rather than to empower them.”

Even now, as a busy college freshman majoring in biology and premedicine, Jennifer volunteers, even living on the “Civic Engagement Floor” of her dormitory at the University of Minnesota, Morris.

“Volunteering changed me as a person,” said Jennifer. “I was very shy, and it made me more outgoing. It helped me manage time and learn about being responsible. It’s become who I am now.”

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T

om Haglin, CEO, lives in a little-known world where scorching manufacturing industry has been hit so hard by this downturn.”

LINDAR has become a cutting-edge operation, infused with highheat is an ally, no shape is unchangeable, and stretching is expected tech automation in a 100,000 square-foot facility. LINDAR’s 93 full-time from everyone. At LINDAR Corporation in Baxter, Minnesota, transforemployees earn an average annual wage of about $37,000, plus an additionmation is the name of the game. al $8,000 in benefits, a boost to the area’s year-round economy.

Just out of sight in the tree-lined industrial park, the thriving compa“We are fortunate to have Tom Haglin and LINDAR Corporation ny enjoys its reputation as the best-kept secret in town. Even though LINhere. Tom pursues manufacturing DAR is a homegrown success story, opportunities that benefit the comfew people realize that this thermoformed plastic enterprise endured “If you drew up the perfect success story pany as well as the entire commuharrowing global competition to for economic development, you’d find nity,” said Sheila Haverkamp, executive director of the Brainerd become the largest manufacturing Area Development employer in the Brainerd lakes area. yourself telling the story of LINDAR. It’s a Lakes Corporation (BLADC).

Despite international rivals and story about hometown pride, leadership, “What’s moved us forward is volatile oil prices, LINDAR quietly makes products we all recognize. and service. And it’s a story about creat- always being lean, watching every penny, pushing things to the max,” From mountains of plastic pellets added Gordy Murphy, LINDAR’s come stroller seats, paint-tray liners, ing quality jobs when it really matters.” operations manager, “whether it’s medical packaging, and containers investing in the capabilities of our people or our equipment.” for produce and bakery goods. Many of their customers are household This strategy is driven by Haglin’s vision, forged through the inspiranames—General Mills, Pillsbury, Sherwin Williams, and Toro. tion and hard work of the LINDAR team, and fueled by the financing that The LINDAR story started in 1993, when Haglin purchased a small enables expansion and innovation. Part of the financing, which meant the company in Remer, where orders were frequently taken down “on the back difference between economic growth and inertia for LINDAR, came from of a phone bill.” Haglin dreamed of moving the business to his hometown the Initiative Foundation’s business lending programs. and providing steady living-wage jobs, even though Brainerd is better “When the Initiative Foundation is involved, that helps us put togethknown for tourism than manufacturing. er a better funding package,” said Haglin. “It provides a lot of reinforcement “Deep down, we’re a railroad town,” he said. “That’s really where the for the bank or lead lender that it’s a good investment.” roots came from—the paper mills, the hard-core work ethic.”

Since 1986, the foundation has invested $34.2 million to create or In 1994, Haglin brought his company home, building a 12,000 secure more than 9,600 quality jobs in central Minnesota. In 2008, LINsquare-foot facility in the Baxter industrial park. Four years later, he more DAR created two new managerial positions, hiring a quality manager and than doubled the size. By 2001, facing another expansion and a foray into a manufacturing manager. In the previous 18 months, the sales department the food packaging business, he moved to the current site and built a increased from one to six full-time sales people.

60,000 square-foot space designed to meet the company’s expanding needs.

“If you drew up the perfect success story for economic development, In 2007, LINDAR purchased Brainerd manufacturer, Plastics Plus, you’d find yourself telling the story of LINDAR,” said Sandy Voigt, and moved the entire operation into its Baxter facility. All 35 employees Initiative Foundation program manager for technology finance. “It’s a story kept their jobs.

“Before I started working here, I’d heard about LINDAR, but I about hometown pride, leadership, and service. But even more importanthad no idea what they did,” said Gail Hradsky, LINDAR customer ly, it’s a story about creating quality jobs when it really matters.” service rep and Brainerd native. “Most people don’t realize how many Haglin also supports the community that helps him meet those chalthings we make.” lenges. He volunteers with BLADC, the Brainerd Lakes Chamber, Central Hradsky, who was laidLakes College, and Enterprise Minnesota. He is also involved with his off by a lakes area mortgage church, and he encourages his employees’ involvement with family and company two years ago, is community projects, as well. grateful to have found a “I don’t know long term where we’ll be,” Haglin said. “Over the next full-time job with a solid three years we have goals and, probably before we achieve them, we’ll ratchcompany. “There’s a sense et it up again. We have to keep pushing and challenging ourselves, keep of loyalty and commitment,” doing things better tomorrow than what we did today.” she said, “especially since the For Haglin and LINDAR, the stretching continues.

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iffany Mason-Davies and her four children huddled in one bedroom of their Pine River mobile home, trying to keep warm under a mound of donated blankets. She tried to seal the gaps around windows and doors with plastic and piled dirt around the trailer skirting. In this frigid January, her thermometer read 46 degrees—indoors.

Nighttime temperatures plummeted low enough to freeze her fish tank. There was no toilet or running water. Her children never wanted to get out of bed or come home after they went to school. A waitress and single mother, Mason-Davies spent $500 a month on propane as other bills and late notices piled up. “It was killing us,” she said.

Her surprisingly common story inspired the Rural Renewable Energy Alliance (RREAL) and its uncommon efforts to harness the power of the sun.

R R E A L “This nonprofit dream-come- installs residential true shows us the power and solar heating systems to help defray promise of renewable energy. expenses for lowIt’s a testament to selfless- income families.

RREAL founder, ness and determination— Jason Edens, a team doing something great even assembled of social entreprewhen people say you can’t.” neurs to perfect a solar-powered furnace that serves as a simple sidekick to a home heating system. A sidemounted box, with a solar-absorbent covering, heats air naturally before blowing it into a home. The system not only reduces carbon emissions; it also reduces heating bills by 25 percent and often eliminates the need for public fuel assistance.

“RREAL operates at the nexus of environmental and social justice,” Edens said. “We’re able to take renewable energy and address a social need.”

As the economy worsens, RREAL’s demand grows. In January 2009—barely halfway through the winter heating season—the Tri-County Action Program already approved 5,192 requests for heating assistance in Stearns, Benton, Sherburne, and Morrison Counties. It took all of 2008 for the organization to approve 6,153 requests.

RREAL’s clients include those in generational poverty, recent victims of the economic recession, and middle-class families struggling to make ends meet. Like Mason-Davies, many live in substandard housing in need of major repairs. Clients must qualify for energy assistance and own a weatherized home with a good solar site. To raise additional revenue, RREAL also installs market-rate systems.

Since Edens founded RREAL in 2000, its staff and volunteers have installed more than 60 systems for low-income families. Their

goal is to complete 100 installations in 2009.

“I’ve experienced poverty firsthand,” said Edens. Growing up, his family often received assistance for energy and food. The idea for the organization came to him in 2000 as he researched a graduate-school paper. After studying energy-efficient housing in Florida, RREAL was born.

Neither a scientist nor an engineer, Edens first step was to locate a cheap supplier of solar thermal collectors that could be retrofitted for residential use. He purchased a few from across the country and refurbished them. The costs were prohibitive, and the collectors weren’t ideal.

With support from the Initiative Foundation and Hunt Utilities Group, Edens joined forces with Graham Wright in 2006. Wright was a former Kodak engineer desiring to make a renewable energy career shift through the national Volunteers In Service To America (VISTA) program.

Each year, the Initiative Foundation places 20–25 full-time VISTA volunteers in central Minnesota nonprofit organizations that work to reduce poverty. RREAL has benefited from three VISTAs and also participated in the foundation’s Healthy Organizations Partnership program, learning the essentials of nonprofit management.

Over the next two years, the RREAL team applied science, passion, and experience to develop its own residential solar collector. They installed several solar prototypes on a trailer home that served as an authentic testing facility. Though certification for the system is still pending, Edens is now working with a Minnesota company to begin plans for manufacturing.

For Mason-Davies, the organization’s work meant salvation. She frequently talked with Edens and his wife and partner, B.J. Allen, at the coffee shop where she works. The conversation turned to solar energy.

Edens visited Mason-Davies in 2008 to take measurements, but her home was too inefficient to hold heat. Edens thought about the vacant testing facility and returned with an unusual proposition.

“He wanted to give us a new home and I didn’t believe it would happen,” Mason-Davies said. “I cried. I wonder why we were chosen when so many people struggle. That happens on Oprah, not in Pine River.”

RREAL isn’t in the business of giving away homes, but they believe in paying it forward. Edens and his team hope to involve students in their efforts, knowing that today’s kids will be tomorrow’s energy consumers and leaders. In addition, Edens is working to replicate RREAL’s program across the Midwest.

“This nonprofit dream-come-true shows us the power and promise of renewable energy,” said Don Hickman, Initiative Foundation senior program manager for planning and preservation. “It’s a testament to selflessness and determination, doing something great even when people say you can’t.”

I

ts downtown is vintage Americana, with flag-lined streets, decorative lampposts, and bustling businesses. Two pristine lakes embrace the city limits, and residents return the favor. Investments in broadband infrastructure move vital data to high-tech businesses and manufacturers, and investments in young children move them confidently toward a lifetime of learning. The whole area seems to run on generosity and volunteerism.

Ah, yes, there’s far more to Pine City than just majestic trees. As many rural communities struggle, Pine City thrives. According to Ben Winchester of the Center for Community Vitality at the University of Minnesota Extension, many downtowns in cities of less than 5,000 have been diminished to a single convenience store.

“They’ve been successful despite these trends,” Winchester said. “It says a lot about the nature of the people and the support of the businesses.”

It wasn’t always that way. With the help of the Initiative Foundation, residents, business owners, and community leaders in this city of 3,300 have spent years developing the image.

Selection to the foundation’s Healthy Communities Partnership jump-started local planning efforts in 2005. The process to create a new

thinking investments in broadband infrastructure through Pine Technical College.

Pine Tech also provides customized training for local workforce needs.

Residents revel in outdoor activities.

The city is nestled between the Snake River and Cross Lake, with Pokegama Nathan Johnson & Lake a short drive to the west. Again, Mayor Jane Robbins with the help of the Initiative Foundation’s Healthy Lakes & Rivers Partnership, residents are ramping up efforts to preserve their family-friendly waterways.

In 2008, volunteers led an effort to improve the water quality in Cross Lake by planting natural water gardens that absorb harmful runoff.

“Our bodies of water are heavily used during the summer and they’re definitely a draw to our area,” Johnson said.

The Voyageur Park Committee also did its part to improve water quality, restoring the park’s shoreline along the Snake River. In the future, Johnson said, the city will add trails, fishing piers, and a floating dock.

“What strikes me most about this community is that people show up. Whether there are challenges to confront, opportunities to seize, or people to help, Pine City residents turn out in full force. That doesn’t happen everywhere.” vision for Pine City kicked off with a foundation grant and a series of 10 public meetings. More than 250 people shared their ideas.

“You need a roadmap, and that’s certainly what this process was,” said Mayor Jane Robbins. “It was a benefit to our whole area.”

One of the many priorities that came from the meeting was a focus on the vibrancy of the downtown area.

“Our downtown is historic, but it’s aging,” said city planner, Nathan Johnson. “We wanted to make sure it stayed a community focal point.”

Volunteers spearheaded downtown beautification efforts. American flags and banners were flown. The city received two foundation grants to help strengthen its farmers’ market.

City leaders also met with 50 local business owners to better understand business needs and what attracted them to Pine City. “It showed them we care about them and we have resources to offer,” Robbins said.

The discussions also helped city leaders market to high-tech companies and manufacturers—two priority industries due to high-wage jobs, low environmental impacts, and the ability to do business from anywhere. The town constructed a technology industrial park while the Initiative Foundation worked with local lenders to invest more than $719,000 to start or expand 11 area businesses. The loans have secured 222 quality jobs.

Beneath its historic downtown, Pine City has made several forward-

Pine City is one of 78 Minnesota hometowns to make the care and education of its children a priority. They tapped foundation resources to form an early childhood coalition. A new childcare association gives licensed providers a place to receive support and training. The coalition’s work has also helped establish school-readiness and reading programs. “(Early childhood) is the absolute best investment you can make for long-term economic development in the community,” said Robert Musgrove, president of Pine Technical College.

Strengthening the youth, Musgrove said, is not only morally right, it prepares children to succeed in school. They’re more likely to invest in education, less likely to need public assistance, or get involved with crime.

The residents’ generosity of time and money also led to the creation of the Greater Pine Area Endowment in 1994, a community fund hosted by the Initiative Foundation that provides a vehicle to fund community projects. Residents have already contributed more than $400,000 in endowment funds that will also benefit future generations.

“What strikes me about this community is that people show up,” said Dan Frank, Initiative Foundation program manager for community development. “Whether there are challenges, opportunities to seize, or people to help, Pine City residents turn out. That doesn’t happen everywhere.”

SPRING 09

25

For generations, humankind has looked to the heavens with questions about its very existence.

In 2009, an answer may have arrived.

Six uncharted stars suddenly appeared in the central Minnesota skies.

Join us as we unlock the mystery.

OUTSTANDING LEADERSHIP Dr. Glen Palm, St. Cloud

OUTSTANDING YOUTH Jennifer Schmidt, St. Cloud

(SEE PG. 14)

(SEE PG. 18)

OUTSTANDING GREEN VENTURE Rural Renewable Energy Alliance, Pine River (SEE PG. 22)

OUTSTANDING NONPROFIT Central Minnesota Habitat for Humanity, St. Cloud

OUTSTANDING ENTERPRISE LINDAR Corporation, Baxter

OUTSTANDING COMMUNITY Pine City, Minnesota

(SEE PG. 20)

(SEE PG. 24)

(SEE PG. 16)

Advance Design & Systems, LLC

Central Minnesota Habitat for Humanity

DAKA Corporation

NorthStar Access

Adventure Creative

City of Pine City

DeGraaf Financial

NorthWay Group, Inc.

Atscott Manufacturing

East Central Regional Development Commission

Palm/Ellison Family

Close-Converse

Brain Magnet Industries

Coldwell Banker Results

Eich Motor Company

Pine City Chamber of Commerce

Brainerd Lakes Chambers

Connections, Etc.

Evergreen Press

Pine Tech College Foundation

Brainerd Lakes Area Development Corporation

Continental Press

HBH Consultants

Cross Lake Association

Happy Dancing Turtle

Rural Renewable Energy Alliance

Central Minnesota Housing Partnership

D.J. Bitzan Jewelers

Hunt Utilities Group IPEX, Inc.

Short Elliott Hendrickson Inc. Smart Site

Mahowald Insurance Agency

St. Cloud Area Thrive Coalition

Mille Lacs Band of Ojibwe

St. Cloud State University

MINPACK, Inc.

Tri-County Abstract & Title

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Schedule an appointment with a UBS Financial Advisor today.

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28 Initiative Quarterly Magazine

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Our Mission Unlock the power of central Minnesota people to build and sustain healthy communities.

Who We Are Created in 1986 by local leaders and The McKnight Foundation, we are one of six Minnesota Initiative Foundations. Through leadership programs, grants and business investments powered by local generosity, we work to strengthen the communities, families, and economy of central Minnesota.

Our Goals — Strengthen Economic Opportunity — Preserve Key Places and Natural Resources — Support Children, Youth, and Families — Build Organizational Effectiveness — Encourage the Spirit of Giving

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Our People

INITIATIVE FOUNDATION STAFF Kathy Gaalswyk President

BOARD OF TRUSTEES

Bethany Carlton Donor Services Clerk

Chris Fastner VISTA Program Manager

Dan Frank Program Manager for Community Development

Sharon Gottwalt Business Finance Assistant

Curt Hanson Vice President for Donor Services

Cathy Hartle

Gene Waldorf

Lee Hanson

Mary Sam

CHAIR Retired, 3M Former Minnesota Legislator

VICE-CHAIR Gray Plant Mooty

SECRETARY/ TREASURER Mille Lacs Band of Ojibwe

Senior Program Manager for Organizational Effectiveness

Don Hickman Senior Program Manager for Planning & Preservation

Tricia Holig Program Assistant for Grants & Training

Anita Hollenhorst Grants & Communications Specialist

Lynn Houle-Bushinger Vice President for Finance & Operations

Jolene Howard Program Assistant for Grants & Training

Lois Kallsen

Barbara Anderson Brainerd Lakes Health

Jim Anderson Anderson Brothers Construction

Chris Close Close-Converse Properties

Office & Facilities Coordinator

Linda Kaufmann Senior Program Manager for Children, Youth & Families

Matt Kilian Director of Communications

Paul Kleinwachter Business Finance Officer

Kris Kowalzek Finance Assistant

Mark Lease Donor Services Officer

Gloria Contreras Edin Edin Consulting

Linda Eich DesJardins Eich Motor Company

Pat Gorham Gorham Companies

MaryAnn Lindell Executive Assistant

Randy Olson Vice President for Economic Opportunity

Leah Posterick Program Assistant for Grants & Training

MaryAnn Schefers Finance & Fund Development Assistant

Jana Shogren Children, Youth & Families Specialist

Arnie Johnson Johnson Enterprises

Dr. Earl Potter III St. Cloud State University

G. George Wallin, PhD. Connections, Etc.

Sandy Voigt Program Manager for Technology Finance

SPRING 09

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counterpunches Before we look back, let’s look ahead. As the recession lumbers into 2009, here’s what your Initiative Foundation is doing to create economic opportunity in central Minnesota. We’re focused on growth, not just on recovery. Remember, the foundation was born from the economic firestorm of the 1980s, so we view the current crisis through a wide lens of experience, resilience and innovation. In 2008, the economy landed its punches.

Here are the ways we’re punching back . . .

Quality jobs are job one.

We’ll strengthen the safety net.

We’re in a unique position to impact our regional economy through business financing programs that secure quality jobs. This year, we’ll invest $2.4 million to start or expand locally owned businesses. Our priority is creating jobs that pay at least $18 per hour with benefits—the living wage for a family of four. In partnership with other lenders, foundation business loans will target high-tech, manufacturing, bioscience and green ventures, all of which hold the promise of future growth.

With more needs and less resources, central Minnesota nonprofit organizations are being called upon to lead and serve their communities. Through our Healthy Organizations Partnership, we’ll provide top-notch leadership training to more than 50 critical nonprofit organizations. We’ll fight poverty by deploying up to 25 full-time VISTA volunteers. All efforts will help our nonprofit leaders join forces and become even more effective.

Our grants will be working overtime. We’ll stay focused on liquid assets.

We’re responding. We’ve refocused 60 percent of our grants to fund efforts that speed economic recovery and help distressed families, workers and small businesses. We’ll support training programs for at-risk and displaced workers. We’ll help small businesses survive and grow with education and consulting services.

We’ll also fund community solutions to transportation, childcare, affordable housing and renewable energy. As always, our goal is to help people help themselves.

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Lakes and rivers define Central Minnesota. Clean water is directly connected to our quality of life, tourism economy, and home and business values. In 2009, we’ll add eight shoreline groups to our growing list of 200 Healthy Lakes & Rivers Partnership alumni groups. We’ll work together to enhance water quality, manage invasive species, solve wastewater issues, and improve land management and habitat.

We’re still long on leadership.

Short-term responses are needed, but long-term planning is most important. In spite of the current economy, central Minnesota’s population is still projected to grow at nearly twice the state average by 2030. Our Healthy Communities Partnership will work with more than half of central Minnesota cities to plan for economic prosperity while preserving special places and natural resources.

Renewable energy is a huge opportunity.

Our best investments are the cutest ones.

Take it from the Federal Reserve Bank. Early childhood is our best future investment, returning at least $8 in public savings for every $1 of funding. During the first five years of life, the human brain forms a blueprint for connecting with the world, people and ideas.

A barren early childhood can lead to future school and job struggles,

“welfare” costs and even crime. That’s why we’ll work with nearly 30 communities (16 coalitions) to make early childhood care and education a top priority. We’ll also be a strong voice for young children of incarcerated parents.

There is power in numbers.

We’re built on the leadership and generosity of thousands. Today is one of the best times in recent memory for donors to earn a whopping ROI. Support our permanent endowment, and The McKnight Foundation will match your gift dollar for dollar. Unite your family or business by starting a named fund. Earn significant tax advantages from charitable bequests, trusts, annuities or insurance. The need is great, but the opportunity is much greater.

Join us, and join the fight.

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Our Numbers FINANCIAL SUMMARY

July 1, 2007 to December 31, 2008

SOURCES OF FUNDS: $13,916,978 Grants & Contributions | $6,744,258 | 48% Business Financing Revenue & Repayments | $3,674,842 | 26% Investment Income* | $3,295,588 | 24% Other Operating Revenue | $202,290 | 2%

USES OF FUNDS: $7,925,764 Grants, Scholarships & Training Programs | $2,957,475 | 37% Business Investments | $2,897,528 | 36% Foundation Operations | $2,044,402 | 26% Special Projects & Other | $26,359 | 1% TRAINING PROGRAMS

EXPENSES INCURRED

Early Childhood Mental Health

$109,272

Early Childhood

$176,323

Healthy Communities Partnership

$288,084

Healthy Organizations Partnership

$257,100

Healthy Lakes and Rivers Partnership

$133,290

Volunteers in Service to America

$416,632

Youth, Meth & New Initiatives

$30,411

TOTAL

GRANTS & SCHOLARSHIPS Unlocking the Power of People Investment Total $1,546,363 Children, Youth & Families . . .

Economic Opportunity. . . . . . .

Organizational Effectiveness . .

Natural Resources Preservation Hometown Improvement . . . . .

Community & Donor Funds . . .

Scholarships . . . . . . . . . . . . .

Community Planning. . . . . . . .

. . . . . . . .

. . . . . . . .

. . . . . . . .

22% 20% 17% 13% 12% . 9% . 4% . 3%

$1,411,112

Total Endowment $23.5 million Total Assets $39.6 million

*Excludes unrealized losses on investments of $12 million.

Report totals are comprised of audited financials for 7/1/07 to 6/30/08 and preliminary financials for 7/1/08 to 12/31/08.

A complete audit report prepared by LarsonAllen, LLP is available upon request.

BUSINESS FINANCING Local Owners, Quality Jobs Investment Total $3,960,390 Manufacturing . . . . . . .

Technology . . . . . . . . . .

Service . . . . . . . . . . . .

Environment/Agriculture Retail . . . . . . . . . . . . .

. . . . .

. . . . .

46% 20% 18% 10% . 6%

Our Results FROM 1986-2008 > Invested

$34.1 million in

817 locally owned businesses > Awarded 542 scholarships totaling $421,295 > Made 3,031 grants totaling $19.2 million > Created or secured 9,595 living-wage jobs > Trained 1,540 leaders from 129 communities to plan and

achieve a brighter future

> Trained 1,351 leaders to improve the water quality of

191 lakes and rivers

868 leaders from 96 nonprofits to manage more effective organizations

> Trained

> Trained 581 leaders from 15 communities to

prepare young children for lifetime success

> Deployed 95 full-time VISTA volunteers to

reduce poverty in central Minnesota

RETURN ON INVESTMENT County

Resident Donations to Initiative Foundation *

Initiative Foundation Investments in County **

Benton Cass Chisago Crow Wing Isanti Kanabec Mille Lacs Morrison Pine Sherburne Stearns Todd Wadena Wright

$275,000 $474,000 $318,000 $1,013,000 $1,029,000 $103,000 $504,000 $987,000 $505,000 $625,000 $903,000 $677,000 $283,000 $468,000

$3,121,000 $3,264,000 $2,387,000 $7,999,000 $2,326,000 $894,000 $3,038,000 $4,259,000 $2,382,000 $3,583,000 $10,946,000 $2,843,000 $2,771,000 $3,961,000

1,035% 589% 650% 690% 126% 766% 502% 331% 372% 473% 1,112% 320% 877% 746%

TOTAL

$8,166,000

$53,773,000

559%

ROI

*Rounded numbers include individual, business, government and utility donations. **Rounded numbers include nonprofit grants, business financing investments and scholarships.

SPRING 09

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Our Friends To our donors, we say thank you. We value each gift for the special reasons it was given and for the trust you have placed in our foundation. The following are our program and endowment gifts received between July 1, 2007 and December 31, 2008.

PLATINUM KEYMASTER ($100,000 OR MORE) Bush Foundation Corporation for National & Community Service Arnold & JoAnn Johnson The McKnight Foundation Otto Bremer Foundation Jack & Betty Thomas USDA Rural Development GOLD KEYMASTER ($50,000 OR 99,999) Gloria M. Cessna Center for Rural Policy & Development Connexus Energy East Central Energy Minnesota Power Southwest Initiative Foundation State of Minnesota, Department of Commerce KEYMASTER ($25,000 TO 49,999) Bremer Banks Communications Alternatives, a subsidiary of Benton Cooperative Telephone Company Eich Motor Company The Jay & Rose Phillips Foundation Beverly M. Johnston Medica Foundation Morgan Family Foundation Morrison County Student Loan Assoc Stearns Electric Association West Central Telephone Association PORTAL ($10,000 TO $24,999) Anderson Brothers Construction Company The Anderson Family Legacy Foundation Agency

36 Initiative Quarterly Magazine

Benton Telecommunications Foundation City of Little Falls Consolidated Telecommunications Company County of Benton County of Cass County of Crow Wing County of Isanti County of Morrison County of Sherburne County of Stearns diversiCOM/Melrose Telephone Company First National Bank of Milaca Funders' Network for Smart Growth & Livable Communities Kathy & Neal Gaalswyk Granite Equity Partners, LLC Kuepers, Inc. Architects & Builders Lake Region Conservation Club The Laura Jane Musser Fund Mid-Minnesota Federal Credit Union Northwest Area Foundation Fund of The Minneapolis Foundation Robins, Kaplan, Miller & Ciresi LLP Foundation for Education, Public Health & Social Justice, a supporting organization of The Minneapolis Foundation Schlagel, Inc. SPEDCO Economic Development Foundation of The St. Paul Foundation U.S. Bancorp Foundation Francis & Ludmila Voelker Eugene & Bernadine Waldorf Estate of Mark Wood GATEWAY ($5,000 TO $9,999) AgStar Fund for Rural America/AgStar Financial Services American Heritage National Bank Bank of the West

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Cambridge Medical Center CentraCare Health Foundation Charles & Barbara Christian City of Cambridge City of St. Cloud City of St. Michael Clow Stamping Company County of Chisago County of Pine County of Todd County of Wright Cuyuna Regional Medical Center Donald & Deanna Engen The Hyduke Foundation of The St. Paul Foundation on behalf of Peoples Bank of Commerce Lakeland Mold Company, Inc. Lakewood Bank, Brainerd/Baxter Larson/Glastron/Seaswirl, Inc. LarsonAllen, LLP, St. Cloud Little Falls Area Chamber of Commerce Manufacturing Fund of Central Minnesota Marco, Inc. Mardag Foundation Minnesota National Bank & Agency Loren & Kathryn Morey NOR-SON, Inc. Pequot Tool & Manufacturing, Inc. Pine Country Bank Rockwoods Grill & Backwater Bar Everett & Rita Sobania St. Joseph’s Medical Center/Brainerd Lakes Integrated Health System The Sheltering Arms Foundation Viking Label & Packaging, Inc. Warren & Sharla Williams Widseth Smith Nolting & Assoc. Inc. Woodland Bank Xcel Energy Foundation

CORRIDOR ($3,000 TO $4,999) City of Nisswa City of Princeton City of Sauk Rapids City of St. Joseph City of Staples County of Kanabec County of Mille Lacs Gray Plant Mooty Curt & Mary Beth Hanson Happy Dancing Turtle Don Hickman & Sandra Kaplan Matt & Jeanne Kilian Mark A. Lease William Scarince Stephen & Gwyn Shelley Thelen Heating & Roofing, Inc. Venture Allies, LLC PASSAGE ($1,000 TO $2,999) Anakkala, Berns, & Co, PLLP Barb & Duane Anderson Keith H. Anderson BankVista Steven & Ann Benda Brainerd Lakes Chambers Lynn & Darren Bushinger Central Minnesota Community Foundation Citizens State Bank City of Albertville City of Annandale City of Baxter City of Big Lake City of Breezy Point City of Clarissa City of Cokato City of Cold Spring City of Crosslake City of Eden Valley City of Lake Shore

City of Lindstrom City of Long Prairie City of Maple Lake City of Melrose City of Milaca City of Mora City of Paynesville City of Pierz City of Pine City City of Rockville City of Rush City City of Sandstone City of Sartell City of Wadena City of Wyoming Gloria L. Contreras-Edin County of Wadena Crow Wing Power D. J. Bitzan Jewelers, Inc. DeZURIK Water Controls Farmers & Merchants State Bank Chris Fastner & Kathy Hakes-Fastner First National Bank of Walker Dan & Annette Frank Gold’n Plump Poultry Great River Energy David Gruenes Cathy Hartle & Doug Larsen Tricia & John Holig Anita & Brad Hollenhorst John Kaliszewski Paul & Shirley Kleinwachter Kristine & Kenneth Kowalzek Lakes Printing Little Falls Machine Eugene Menzel Plaza Park Bank Dr. Earl H. Potter, III Mary L. Sam Schlenner Wenner & Co. Shelley Funeral Chapels, Inc. Dorothy & Mike Simpson St. Gabriel's Hospital Todd-Wadena Electric Cooperative David Toeben Sandy Voigt Dr. George & Raquel Wallin Xcel Energy, St. Cloud ACCESS (UP TO $999) AccountAbility Solutions, LLC Altobell Imagery, LLC Amcon Block & Precast, Inc. Annandale Community Team Better Way Foundation, Inc. Blue Cross Blue Shield of Minnesota Dr. & Mrs. Jerry Bobeldyk

Katy & Steve Botz Lyle & Patricia Bourdon Brain Magnet Industries Brainerd Daily Dispatch Brainerd Public Schools Bromelkamp Company, LLC Cambridge Launderers & Cleaners, Inc. Cambridge Orthodontics, P.A. Bethany Carlton City of Avon City of Backus City of Becker City of Belgrade City of Bertha City of Bock City of Bowlus City of Boy River City of Braham City of Buckman City of Burtrum City of Cass Lake City of Center City City of Chickamaw Beach City of Chisago City City of Clearwater City of Crosby City of Deerwood City of Eagle Bend City of East Gull Lake City of Emily City of Fifty Lakes City of Foley City of Garrison City of Grasston City of Grey Eagle City of Hackensack City of Harding City of Henriette City of Hewitt City of Hinckley City of Holdingford City of Isanti City of Isle City of Jenkins City of Kimball City of Longville City of Montrose City of Motley City of Nimrod City of Ogilvie City of Onamia City of Pease City of Pequot Lakes City of Pillager City of Quamba City of Randall City of Remer

City of Rice City of Richmond City of Riverton City of Rock Creek City of Ronneby City of Royalton City of Sebeka City of South Haven City of St. Martin City of St. Rosa City of Swanville City of Taylors Falls City of Upsala City of Verndale City of Wahkon City of Walker City of Waverly Christopher & Amber Close Close-Converse, Inc. Coborn's, Inc. Cold Spring Area Chamber of Commerce Helen L. Comnick Continental Press, Inc. Cook's World of Water Donald & Carol Crust DeGraaf Financial, Inc. DES OF ST. CLOUD, INC. East Central RDC Susan Fairchild & Steven Winn Faith In Action-Cass County First National Bank of Cold Spring Margaret Flolid Bruce & Mary Fogle Curt & Judy Forst Frandsen Bank & Trust Stefan & Michele Freeman Ray & Gwynne Gildow Sharon & Chuck Gottwalt Grand View Lodge Hallett Community Center Foundation HBH Associates, LLC. Ronald & Barbara Hedlund Jack Heule & the late Kathy Bussard Keith & Laura Beckman Horizon Bank Jolene Howard Hunt Utilities Group, LLC IPEX, Inc. Peter & Lynne Jacobson Al & Lynda Johnson Sue Johnson Jerome E. Johnson Kim & Sally Johnson Lois & Len Kallsen Kanabec Hospital Linda Kaufmann

Norman & Julie Krause Irene Kurpius-Lindvall Gary W. Y. Kwong Lakewood Health System Colleen H. LeBlanc MaryAnn & Pete Lindell Line’s Building Center, Inc. Little Falls Orthopedics Paul & Joan Lombardi Long Prairie Packing Company Carol Lovdahl Mahowald Insurance Agency, LLP Martin & Betsy Mahowald Diane M. Mendel Ronald & Barbara Middelstadt Minnesota Business Finance Corporation MINPACK, Inc. Walter & Adele Munsterman North American State Bank Northern Star Therapy Robert & Marilyn Obermiller Dennis & Evie O'Donnell Kristin & Daniel Olson The Order of St. Benedict/St. John's Abbey Pine River Chamber of Commerce Pine River-Backus Family Center Pine River-Backus School District Pine Technical College Geri Pohlkamp Portage Crooked Lakes Improvement Association Leah & Dennis Posterick Donald F. Quaintance Ann M. Sand MaryAnn Schefers The Selective Group Foundation Shing Wako Resort & Campground Jana & Michael Shogren State Bank of Cold Spring State Bank of Kimball Stearns, Inc. Charles & Penny Swanum Swanville Women’s Civic Club Jim & Liz Thares Upfront Consulting Joseph & Diane VanBeck Ashley Vargo-Guggemos George & Elizabeth Vilfordi The Whitney Foundation Paul & Alice Wirth Dave & Luann Wood Wright County Human Services Tina Yorek

SPRING 09

37

Our Friends, continued TRIBUTES In Honor of Edmund Babcock The Bank of Elk River In Memory of Mary Anne Grafton-Rodgers Rose & the late Ronald Powell In Honor of James Kurpius Justin & Amy Kurpius In Honor of Irene Kurpius-Lindvall John & Connie Roberts In Memory of Evelyn Middelstadt Rose & the late Ronald Powell In Memory of Helen K. (Wolf ) Mills Anonymous In Memory of Harry Nysather Louise Nysather In Memory of Ronald Powell Ronald & Barbara Middelstadt Rose Powell In Memory of Kari Richardson John & Tracy Askwith B & B Carpet One B&D Plumbing, Heating & Air Conditioning Bakken Building & Remodeling The Bank of Elk River Gregg & Teri Barbeln Beaudry Oil & Propane Kathy Z. Berger Tim Bjella Michael & Dawn Blake Evelyn Buetow Builders Incentive Group, Inc. George & Margaret Carter Charles & Barbara Christian Deborah L. Crowley Bradley & Kelly Dalbec Dennis & Tracy Daleiden Meinrad & Ramona Daleiden The Dive Shop David & Marjorie Dobosenski Jessica E. Driscoll Greg & Kathy Dupre Eagle Window Dist. Co. Michael & Jane Ehresmann Erik & Lori Ellingson Erik & Marjorie Ellingson James & Betsy Ellingson Mark & Janna Ellingson Richard & Janet Ellingworth Annette Ellstrom Mark & Jacqueline Elmers Energy & Environmental Building Association Brian & Susan Faue

38 Initiative Quarterly Magazine

Michele D. Fedderly First National Bank of Elk River Derek & Carrie Fischer Jeffrey & Ann Gagen Daniel & Kris Gasner Holly A. Glaeser Michael & Beth Granger John & Cynthia Grevious Stephen & Kathy Grossman Jan & Gretchen Haukos Heating & Cooling Two, Inc. Donald & Elizabeth Heinzman Susan D. Herrmann Michael & Martha Hippe Daniel & Helen Holmes Homes Plus Designers/Builders, Inc. William & Margaret Imig Initiative Foundation Paul & Donna Jacobs Charles & Judy Janski Larry & Barbara Janski Thomas & Christine Jensen Maurice & Donna Johnson Randy & Michelle Johnson Keller Williams Realty Integrity Bill & Patty Knoblauch Larry & Juleen Koenig Marcia J. Koester Kirk A. Kroll Duane & Patsy Kropuenske Charles & Debra Kuhl Bradley & Becky LeDuc Lights On Broadway, Inc. Lester & Karen Linner Marcia Love Susan Maki Steven & Lori Marcy Thomas & Michelle Matchie Barbara A. Materna Clinton & Sandra Maxwell Jerry & Joanne McChesney Meiny's Diggers, Inc. Rebecca J. Milless Jennifer S. Moberg Arlene E. Morem Dean & Evelyn Morem Steven & Sandra Morgan Eric & Karen Moschet Rob Moschet Jennifer L. Mueller Dan & Valerie Nelson New Beginnings of Princeton, Inc. Michael & Debra Newman Randy & Joann Nielson Northland Cabinets, Inc.

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Northstar Granite Tops Jennifer A. Panchenko Jack & Kelani Parisien Brian & Sharon Parrish David & Sandra Petersen Jerry & Barbara Peterson John & Christina Plaisted Gordon & Nancy Robinson Stanley & Dorothy Rogers Adair & Lisa Rosenow Kathryn P. Samuel Anne M. Saxton Steven & Christy Schmidt David & Cynthia Sebold Robert & Patti Solheim South Side Lumber Company Steve's Floorcovering, Inc. Craig & Rosie Storie Mark & Linda Strater Duane M. Swenson Michael & Brooke Swenson Mark & Cynthia Taylor Terra General Contractors, LLC Ann C. Thomas Three Rivers Community Foundation TLS Custom Concrete, Inc. Warners' Stellian Co., Inc. Constance M. Wilson Eugene & Susan Wipf Larry & Donna Jeanne Wipf John P. Zirbes In Memory of Robert Westvig Joanne B. Burdick Ronald & Barbara Middelstadt Curtis & Margaret Powell LEGACY GIFTS Gloria M. Cessna Gloria L. Contreras-Edin Evelyn L. Henry The Mark A. Lease Family Gladys M. Paulson Francis & Ludmila Voelker COMMUNITY & AFFILIATED FUNDS Greater Pine Area Endowment Isle Area Community Foundation Little Falls Area Foundation Hanowski Family Fund Mark Wood Foundation Staples Community Foundation Julius & Tracy Kurpius Fund Loren & Kathy Morey Family Fund

Staples/Motley Dollars for Scholars Fund Staples Knights of ColumbusLloyd & Marion Giddings Scholarship Fund Sacred Heart-Knights of Columbus Fund Three Rivers Community Foundation Archie & Isabelle Powell Family Memorial Scholarship Fund Charity Evenson Memorial Scholarship Chuck & Barbara Christian Fund Friends of the Elk River Library Fund Jeanette & Mel Beaudry Fund Josh Richardson Youth Arts Fund Zimmerman PTO-Lions Scholarship Fund NAMED & AFFILIATED FUNDS Alternative Sources of Energy Fund Anderson Brothers Family Fund Betty Ford Menzel Scholarship Fund Beverly M. Pantzke Scholarship Fund* Bob & Pauline Johnson Memorial Scholarship Fund Bob Wright Memorial IFPA Scholarship Fund Bob & Marsha Bunger Endowment Fund Family Farm Fund Friends of the Civil Air Patrol Fund* Hackensack Area Animal Shelter Fund* John & Bonnie Schlagel Funds Lake Region Conservation Club Fund* Leech Lake Area Watershed Foundation Little Falls Scholarship Fund* Minnesota Pioneer Park Endowment Fund Shawn Grittner Scholarship Memorial Fund William & Ethel Nelson Zimmerman Memorial Scholarship Fund Wright County Historical Society LOAN FUNDS Princeton Loan Fund Todd-Wadena Loan Fund Menahga Loan Fund *New funds established during 2008 calendar year.

SPRING 09

39

Initiative Foundation Spring 09 Newsletter

More Economic Leadership Gorham, Olson Join the Foundation Team >Strengthening economic development

>Randy Olson, the foundation’s new vice

in central Minnesota is a key motivator for Mora business owner and entrepreneur, Pat Gorham, who was recently selected to serve on the foundation’s board of trustees.

“I want to make a positive difference and have a positive effect on what’s going on in our region,” said Gorham. “I think everyone should Pat Gorham, Trustee be involved in their community in some fashion.”

After working for such firms as Honeywell and Cessna, Gorham returned to his hometown of Mora to work in his family’s business. He began by managing a St. Cloud apartment complex built by his father and uncle. Over the next 20 years, he expanded his portfolio to include multiple apartment complexes and an air charter business as well as his family’s construction, propane, natural gas, and banking companies.

president for economic opportunity, will lead efforts to stimulate economic development through planning, partnerships and business lending programs.

“Small businesses will continue to provide the economic foundation for our communities,” Olson said. “I look forward to strengthening our Randy Olson, V.P. existing services and introducing new services in support of the small business community.”

Olson is the former state director of Minnesota’s Small Business Development Centers. He managed the SBDC’s nine regional centers, which provide business counseling, training, loan packaging, and other resources for entrepreneurs. Olson’s most recent position was general manager of University Enterprise Laboratories, a University of Minnesota initiative to help new bioscience firms.

40 Initiative Quarterly Magazine

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www.ifound.org | 877.632.9255

Communities Begin Journey Foundation Selects Four for New Leadership Program >Delano, Long Prairie, Pine River, and Royalton will rally residents to improve their communities and local economies as the first four selections to the foundation’s next-generation Healthy Communities Partnership (HCP) program. The program helps to engage citizen teams in planning, action and leadership efforts.

The communities were chosen based on economic need, strong volunteer commitment, and the willingness of their local government to work with citizens in creating a more sustainable future.

Beginning in March, Initiative Foundation staff will help community teams study local economic, social, and environmental trends.

Each community will then use the information and citizen input to create a plan to increase living-wage jobs and enhance business recruitment and retention efforts.

As part of the program, each community will receive a planning grant of up to $10,000 and is eligible for up to another $10,000 per year for community projects over the next four years.

A $100,000 grant from the Bush Foundation will help fund the fourcommunity effort, another way both foundations are responding to the economic recession. Based in St. Paul, the Bush Foundation serves Minnesota, North Dakota, and South Dakota Long Prairie to develop leaders and engage entire communities in solving problems.

“We’re thrilled to receive continued support from the Bush Foundation,” said Dan Frank, Initiative Foundation program manager for community development. “These teams will now be able to make some huge strides toward building a better future for their communities.”

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42 Initiative Quarterly Magazine

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SPRING 09

43

Greater Minnesota is better prepared now than in 1986, thanks to the Initiative Foundations

By Kate Wolford

W

hen confronting great challenges, we often turn to the past to remember what we’ve learned and how far we’ve come.

Facing unprecedented deficit projections and tens of millions of dollars in state cuts to cities and counties, Minnesotans are talking seriously about reducing our state’s overall budget for the first time since 1986, a troubling reminder of another era’s economic collapse. Recalling that difficult time over 20 years ago helps illustrate how much better protected Greater Minnesota is today to weather such a storm.

By the mid-1980s, rapidly declining demand led to the near disappearance of crucial markets for farming, mining, and lumber in Greater Minnesota. Nothing was left to fill the economic void, and the result was almost immediately crippling and threatened to destroy communities.

In the wake of that implosion, The McKnight Foundation joined forces with local leaders to establish the six Minnesota Initiative Foundations—a network of regional foundations and business catalysts.

Because natural resource-driven markets had left the regions vulnerable to collapse in the 1980s, the MIFs pioneered economic development, grant, and loan programs customized to their own home regions. Working in tandem with commercial lenders, investors, and public financing, the MIFs invested in new businesses and industries to support regional growth.

Since 1986, the MIFs have collectively secured more than 37,000 jobs.

They have provided more than $174 million in business loans and investments, and granted more than $120 million to the state’s nonprofits.

In the current economy, many of Minnesota’s strengths are a result of the economic diversity the MIFs have painstakingly fostered for over two decades. Gone is our reliance on only a handful of industries. The Initiative Foundation and the other MIFs have helped to build a healthy, diversified business base for each of their regions.

As in 1986, the speed and severity of our current economic crisis signals that grantmaking and government alone will not be enough to turn the tide. Full-scale, locally targeted solutions are needed to create jobs, foster new rural economies, and help businesses grow and flourish.

Although rural Minnesota still benefits from profitable farm commodities, that is unlikely to last into 2010. Recent reports indicate our state is losing its competitive edge in technological innovations and related jobs.

44 Initiative Quarterly Magazine

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Chris McAllister

Contrasting Crisis

In some Minnesota counties, more than a quarter of the population is now 65 or older, and employers everywhere are grappling with the challenges of an aging workforce. Tied to the country’s industrial demands, the state’s open-pit mining economy is once again struggling to survive.

To help Minnesotans face such challenges, each Minnesota Initiative Foundation must remain financially robust. Every dollar invested in the Initiative Foundation, when coupled with McKnight’s matching funds, brings measurable economic stimulus to Central Minnesota. The Initiative Foundation alone has been responsible for more than 9,500 jobs, $19 million in grants, and more than $34 million in loans to central Minnesota businesses.

In 2009, the Initiative Foundation will again respond to economic challenges. It recently announced plans to target its grantmaking and lending efforts to create high-quality jobs, develop workforce skills and training, and build the capacity of nonprofit organizations to serve displaced workers and distressed families.

“Every dollar invested in the Initiative Foundation, when coupled with McKnight’s match, is bringing measurable economic stimulus to Central Minnesota.”

By design, the Initiative Foundation and the other MIFs go places and touch individual lives that McKnight couldn’t reach without their relationships and their leadership. They have transformed our longtime investment into stronger communities statewide, and helped Greater Minnesota prepare for the economic context in which we now find ourselves.

As we face the toughest economy in generations, it’s heartening to know that Greater Minnesota is well positioned to weather this storm.

Kate Wolford is the president of The McKnight Foundation, a Minnesota-based family foundation headquartered in Minneapolis.

Supporting children, families, regional growth, the environment, and the arts, McKnight granted about $99 million in 2008.

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