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NEIGHBORHOOD DEVELOPMENT CENTER

2009 ANNUAL REPORT

entrepreneurship creates jobs

revitalizes communities

fills empt y storefronts cultivates

builds safe

leaders

neighborhoods


A Year of Impact

A Ye ar of Impact

Dear Friends of NDC,

BOARD OF DIRECTORS Kate Barr (Board Chair) Nonprofits Assistance Fund Tim Boberg Hays Companies Wafiq Fannoun (Board Secretary) Islamic University of Minnesota John Flory (Vice Board Chair) Latino Economic Development Center

Mihailo Temali NDC President & CEO

Tony Genia (Past Board Chair) Northwest Area Foundation

Our future continues to be based on two key “assets”: neighborhood “underground” entrepreneurs who are so often hidden or underutilized in the targeted neighborhoods and ethnic communities we work in, and our community partners who have the trust, credibility and connections required to find these folks. The resources we bring to both—through our dedicated staff, trainers, board and funders—in a long-term comprehensive manner, help entrepreneurs turn their dreams into reality and plants them in their own communities—often on major, visible corridors like Payne Avenue, University Avenue, West Broadway and Lake Street.

Justin Huenemann Native American Community Development Institute Ramon Leon Latino Economic Development Center Lorrie Louder (Board Treasurer) Saint Paul Port Authority Repa Mekha Nexus Community Partners Nneka Morgan Merrill Lynch Arvid Povilaitis Meritex Enterprise, Inc. William Sands Western Bank Vivienne Williamson (Board Vice Chair) Mighty Stitch, LLC May Xiong East Side Financial Center and Center for Working Families

2009 was a year of seeking solid ground from which we could keep building neighborhood economies—both for NDC and for the entrepreneurs we serve. Given the severity of the economic downturn, all of us got better at adapting to constrained resources. Fortunately, NDC as an organization, and most of the low-income entrepreneurs we work with, know a lot about economic tough times. This experience served us all well last year, as most of us emerged from the year with a good sense of how to succeed in the future.

Kate Barr NDC Board Chair

NDC’s unique “people-based/place-based” strategy continued to “build neighborhood economies from within” in 2009, especially in our targeted communities of St. Paul’s East Side and Frogtown/Summit-University, and Minneapolis’ North Side and Phillips/Central/Powderhorn Park neighborhoods. Being able to reach into the various ethnic communities in each of these neighborhoods continues to be our key approach, with a major emphasis on the African American, Oromo, Native American, Hmong, Somali and Latino communities in 2009. On behalf of the NDC staff and board, and most importantly on behalf of all the entrepreneurs and communities we work with, we thank all of our supporters for their generosity. In so many ways, this is what allows NDC to seed the low-income neighborhoods of Minneapolis and St. Paul with hundreds of its own talented entrepreneurs, changing them forever, for the better.

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Strong Values

St rong Valu e s NDC VALUES

MISSION

Asset-Based

Neighborhood Development Center is a community-based non-profit organization that works in the low-income communities of St. Paul, Minneapolis, surrounding suburbs, and Greater Minnesota to help emerging entrepreneurs develop successful businesses that serve their community, and to help community groups build a stronger neighborhood economy.

The talent and energy among residents of low income communities are critical resources available to revitalize those communities economically and socially.

NDC STAFF Jeff Alexander Midtown Global Market Director Darrell Beauford Real Estate Accounting Manager Daniel Birru Accountant

Collaborative

Community partnerships and networks are key to gaining access to and trust from local “underground” entreprenuerial talent.

Alison Collins BRC Supervisor & Assistant Property Manager Becky George Mercado Central Market Manager

Patience

Kimberly Hanna Market Coordinator

Success is a long term proposition that demands patience and an open mind.

Rick Hofacre Facility Maintenance Manager Harvey Hoffman Building Operations Manager

Adaptable

The environment entrepreneurs work in is complicated and constantly evolving and demands from those who work with them an ability to adapt, and a commitment to innovation.

Mike LaFave Deputy Director

NDC STAFF

Earlsworth “Baba” Letang Midtown Global Market Manager

Bonita Martin Training Program Director Perla Mayo Technical Assistance Manager Kathy Moriarty Chief Administrative Officer Samir Saikali Grants & Data Manager Brian Singer Loan Director Emma Spillman Office Manager Ayan Suguelle Training Program Coordinator Mihailo “Mike” Temali President & CEO Sai Thao Loan Officer Michael Thielen Loan Fund Administrator Romaine Turner Senior Loan Officer Teshite Wako Chief Financial Officer John Wheeler Director of Incubators

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Innovative Approach

N D C Innovativ e A pproach MICRO-ENTREPRENEUR TRAINING

SMALL BUSINESS FINANCING

SMALL BUSINESS CONSULTING

CAPACITY BUILDING

SMALL BUSINESS INCUBATORS

In addition to Englishspeaking individuals, NDC provides specialized training to Hmong, Latino, Somali and East African entrepreneurs in their native languages. This 16-week course covers the fundamentals and techniques of marketing, operations, financial management and writing a solid business plan.

NDC’s unique funding resource fills a gap in the Twin Cities finance market by providing access to credit for start-up businesses (and other entrepreneurs) who are unable to access traditional sources of capital. NDC created the nation’s first Reba-Free financing program to meet the needs of the large Somali immigrant community.

There are five satellite business resource centers available to entrepreneurs. NDC provides on-going support in marketing, merchandising, financial record-keeping, credit repair, retail management, legal assistance and more.

NDC works with Neighborhood Partners to enhance their capacity to create and conduct economic development initiatives within their own communities.

NDC and neighborhood organizations collaborate to reclaim and rehab commercial properties within targeted inner city neighborhoods. The properties then operate as Incubators, providing a network of support and resources for small businesses.

203 entrepreneurs trained in 2009

27 loans totaling $344,503 in 2009

More than 3,200 hours of small business consulting to 270 entrepreneurs in 2009

25 Neighborhood Partners across the Twin Cities

3663 entrepreneurs trained since 1993

356 loans totaling $7,178,992 since 1993

Approximately 28,000 hours of small business consulting to 1,200 entrepreneurs since 1993

Our small business incubators: •Frogtown Entrepreneur Center •Frogtown Square (opens 2011) •Mercado Central •Midtown Global Market •Plaza Verde •Swedish Bank Building

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Entrepreneur Success

2 00 9 E n trepreneur Suc ce s s Stori e s CHERYL MIKEL OF RAINBOW CHILD DEVELOPMENT CENTER Winner of the Senator Paul Wellstone & Sheila Wellstone Twin Cities Small Business of the Year Award Rainbow Child Development Center has been providing high quality childcare in the Midway neighborhood of St. Paul since 1998. The Center provides a safe, nurturing place for children to learn, play and grow and is particularly proud of its commitment to serve low-income residents of the community.

NUH JAMA OF FACE 2 FACE INTERPRETING, INC. Winner of the Business Achievement Award Nuh Jama started Face 2 Face Interpreting, Inc. in South Minneapolis in 2006 to provide interpretation and translation services. The business has grown dramatically and now offers services in over 30 different languages. TAMARA MATTISON OF GENERATION TO GENERATION, INC. Winner of the Thomas McBurney Community Impact Award Owner Tamara Mattison created Generation to Generation, Inc. to provide consulting, training and development services for young women. In partnership with Eagles Wings, she created Talitha Cumi—or Daughter Arise!—a 12 week training that focuses on developing healthy relationships, healthy boundaries, self esteem, self awareness, self confidence and self worth.

AWARD NOMINEES Café Finspang Sigbritt Johnson & Maj-Britt Syse Central Coffee Shop Kamaludin Osman Fiesta in America Laura Sanchez Gaviota Construction Harold & Madel Carmen Fajardo Get Gorgeous Styling Salon Ilka Bird Grass Roots Gourmet Victoria Potts

NAT COLLEY OF VET YOUR LAWYER Winner of the Business Creativity Award Vet Your Lawyer’s unique service empowers the ordinary person with objective, independent knowledge about the lawyer s/he is about to hire for their case in order to find the “right” lawyer the first time and save money, time and aggravation. MAKRAM & SHARIN EL-AMIN OF EL-AMIN’S FISH HOUSE Winner of the Longevity and Sustained Impact Award El-Amin’s Fish House is a family-owned take-out restaurant that specializes in freshly prepared fried catfish, whiting and walleye that are prepared with healthy, cholesterol-free cooking oil. Owners Makram and Sharon El-Amin have been serving high quality, fresh fish in the Twin Cities for more than 20 years and at their location on West Broadway in North Minneapolis since 2001. JAMAL HASHI OF SAFARI EXPRESS RESTAURANT Winner of the Business Turn Around Award Safari Express, located at the Midtown Global Market, offers an innovative menu with its own signature style. Brothers Jamal and Sade Hashi sell many classic East African dishes that are a smash hit, including their delectable sambusas, homemade chapati bread wraps, and rich meat and vegetable stews.

Metropolitan Transportation Network, Inc. Gebi Koji & Tashitaa Tufaa Nuestro Mundo Bi-lingual Daycare Lucianna Carballo-Pierre Organize Life Linda LaBarre & Ashlee Olds Rituals Antoinette Williams Sister Chris’ Fruit Flavored Products, LLC Vicie Williams The Clearance Rack Neeson & Haiyen Vang

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Entrepreneur Training

E n treprene ur Traini n g TRAINING PARTNERS

Aurora Saint Anthony Neighborhood Development Corporation African Development Center American Indian Economic Development Fund Chicanos Latinos Unidos en Servicio Dayton’s Bluff Community Council Emerge Community Development Employment Action Center Friendship Community Services, Inc. Hmong American Partnership Hmong Chamber of Commerce Hope Community, Inc. Latino Economic Development Center Lutheran Social Services MIGIZI Communications Native American Community Development Institute Northside Economic Opportunities Network Northeast Community Development Corporation Northside Residents Redevelopment Council Oromo Community of Minnesota Powderhorn Phillips Cultural Wellness Center Riverview Economic Development Association Selby Area Community Development Corporation Seward Redesign, Inc. Sparc

TRAINERS Shahir Ahmed Jeff Alexander Eduardo Barrera Therese Baumann Dave Bonko Barry Bonoff Kari Emory Tony Genia Lu Hang Wendy Hines Tarabi Jama Michelle Jansen Grover Jones Tara McCarthy Juliet Mitchell

Lindsay Nauen Phillip Porter Bob Reed Mark Robinson Edgardo Rodriquez Linda Sapp Joanne Simons Brian Singer Sai Thao Romaine Turner Kin Kia Vang Teshite Wako Dale White Ronald Williams Candy York

Neighborhood Development Center works closely with community-based partner organizations to sponsor 16-week entrepreneur training classes in 20 neighborhoods and ethnic communities throughout Minneapolis and St. Paul. The class consists of eight classroom sessions and up to 12 one-on-one consultations with a business trainer. Classes are offered twice a year (spring and fall cycles) and are currently offered in five different languages (English, Hmong, Oromo, Somali and Spanish). Classes are conducted in small group settings and are hosted by NDC’s community-based partners―emphasizing the connections between the development of individuals and the development of the community.

EMERGE GRADUATION

NDC’s Entrepreneur Training Program is specifically targeted to lowincome residents who do not have access to traditional sources of capital and who want to learn the skills to successfully start and operate a business. NDC provides scholarships to the majority of program participants. NDC classes are taught by professional training consultants who utilize an NDC-developed curriculum and focus on teaching participants the fundamentals of operating a small business and creating a viable business plan. NDC offers workshops on a variety of business related topics. NDC’s ultimate goal is to develop the talent that exists within inner city communities and help emerging entrepreneurs create vibrant businesses that―by creating employment opportunities, providing needed goods and services, offering role models, and establishing vibrant community gather places―contribute to the revitalization of those communities.

YOUNG DADS GRADUATION NDC TRAINING IMPACTS: During 2009, 203 entrepreneurs were trained through NDC’s Entrepreneur Training Program. 5


Small Business Lending

Sm a ll Busine ss L e ndi n g

LENDING PARTNERS Neighborhood Development Center fills a gap in the Twin Cities finance market by providing access to credit for start-up and existing businesses that are unable to access traditional sources of capital. NDC provides financing of up to $50,000 with an average loan size of $12,000.

African Development Center American Indian Economic Development Fund Latino Economic Development Center Metropolitan Consortium of Community Developers WomenVenture

NDC’s flexible individualized approach to lending involves working closely with entrepreneurs to understand their business needs, their long-term plans to grow and improve their business, and the risks associated with their request and strategies to mitigate those risks. NDC often partners with private banks and other community lenders to help make loans more viable. NDC is also open to evaluating requests which do not qualify for financing from other lenders. NDC also offers Reba-Free (asset based) financing to meet the needs of the Twin Cities’ growing Muslim community. NDC has received several awards for creating the first such financing program in the nation. Since 1993, NDC has financed more than 350 companies with more than $7.1 million. According to a 2008 study by Wilder Research on the impact of NDC’s programs, of the businesses helped by NDC, 21% had increased their number of employees and 56% had increased their gross monthly revenues.

NDC LENDING IMPACTS: During 2009, NDC financed 27 loans totaling $344,503. NDC FLYER OFFERING LOANS TO SMALL BUSINESSES

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Small Business Consulting

Sm a ll Busine ss C onsulti n g SMALL BUSINESS CONSULTING Neighborhood Development Center understands that the most important component of an entrepreneur’s education begins after they are open for business. NDC provides graduates of its programs with on-going support in the form of one-on-one business consulting to help guide them through operational difficulties and develop plans to strengthen and improve their businesses. We do this by providing access to professionals with expertise in a variety of key business areas, including: • Business Management • Recordkeeping and Accounting • Marketing • Merchandising • Food Business Management • Credit Counseling • Pro-bono Legal Assistance • Language-Cultural Issues • Referrals The goal of NDC’s business consulting program is to ensure that emerging entrepreneurs receive the support they need to grow, develop and continue to be assets to their communities.

BUSINESS RESOURCE CENTERS (BRCs) NDC launched its Business Resource Center initiative as a means of addressing the “digital divide” amongst business owners―a term which describes the gap in knowledge and experience with computers and technology. Centers are operated by the BRC Supervisor and staffed by qualified college interns from a wide spectrum of study areas including urban development, marketing, business development, graphic design, and more. BRCs provide entrepreneurs with the opportunity to receive one-on-one training to build their computer skills. The goal of the Business Resource Centers is empowerment. NDC believes digital inclusion for low-income entrepreneurs will allow them to develop their business in the most efficient and cost-effective way possible.

BRC SERVICES 1. Self Directed Use Entrepreneurs may use BRC computers to access the Internet or do business-related work on their own. A printer and copier is available for a fee. 2. Small Business Consultation BRC facilities are also used as work-stations for entrepreneurs to meet for more advanced assistance from NDC consultants.

NDC CONSULTING IMPACTS: In 2009, NDC provided more than 3,200 hours of small business consulting to 270 entrepreneurs.

BUSINESS RESOURCE CENTERS:

Cooperative Mercado Central 1515 East Lake Street #208 Minneapolis, MN 55407

3. Computer Skills Assistance By appointment (occasionally walk-ins can be accommodated), individualized small business assistance is available on a variety of topics: • Basic computer and Internet skills • Web-based research (Industry analysis, target markets, etc) • Preparing business plans with Business Plan Pro • Microsoft Office Suite (Word, Excel, PowerPoint, Publisher) • Low- and No-Cost Marketing (Includes creation of business cards, flyers, web-based marketing, online directories, website building, etc.)

Eastside Financial Center Swedish Bank Building 965 Payne Avenue St. Paul, MN 55130

BRC INTERN ASSISTS CLIENT HAROLD FAJARDO OF GAVIOTA CONSTRUCTION

Northside Economic Opportunity Midtown Global Market Network (NEON) 920 East Lake Street (lower level) 1505 West Broadway Avenue Minneapolis, MN 55407 Minneapolis, MN 55411

Rondo Community Outreach Library 461 North Dale Street St. Paul, MN 55103

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Small Business Incubators

Sm a ll Busine ss Incubator s REAL ESTATE PARTNERS Aurora Saint Anthony Neighborhood Development Corporation University/Dale Model Cities of Saint Paul University/Dale Greater Frogtown Community Development Corporation University/Dale Episcopal Homes University/Dale East Side Neighborhood Development Company Old Swedish Bank Cooperativa Mercado Central Mercado Central Project for Pride in Living Mercado Central Whittier Community Development Corporation Mercado Central In the Heart of the Beast Theatre Plaza Verde Powderhorn Phillips Cultural Wellness Center Midtown Global Market African Development Center Midtown Global Market

NDC’s small business incubator program creates dynamic places for small businesses to grow and develop, while creating vibrant active places that contribute to economic development and revitalization of urban neighborhoods.

Since 1993, NDC has redeveloped 5 commercial properties (listed below). Cumulatively these properties represent over 120,000 sq. ft. of commercial space and are home to over 110 small businesses.

Working closely with community-based partners, NDC redevelops key commercial locations within targeted neighborhoods, providing venues within which entrepreneurs can become profitable. These highly-visible renovated buildings also serve as gathering places and inspire hope and confidence within the surrounding community. NDC promotes the success of entrepreneurs within these incubators by providing tenants with a stable, affordable environment to do business and by making its lending and business consulting service available to all tenants.

In partnership with 3 community-based non-profits, NDC is also developing 11,000 square feet of new commercial space in Frogtown Center at the northeast corner of University Avenue and Dale Street in St. Paul.

OLD SWEDISH BANK BUILDING AT PAYNE AVENUE & CASE AVENUE

INCUBATORS:

Frogtown Entrepreneur Center 625 University and 501 North Dale St. Paul, MN 55104

Old Swedish Bank Building 965 Payne Avenue St. Paul, MN 55130

Mercado Central 1515 East Lake Street Minneapolis, MN 55407

MIDTOWN GLOBAL MARKET AT EAST LAKE STREET & 10TH AVENUE S.

PLAZA VERDE NEAR EAST LAKE STREET & BLOOMINGTON AVENUE Plaza Verde 1516 East Lake Street Minneapolis, MN 55407

Midtown Global Market 920 East Lake Street Minneapolis, MN 55407

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University Avenue

Un i v ersi t y Aven ue Busine s s P repa ration C oll ab orati v e ( u7 ) PROJECT SERVICES

In January 2009, a group of eight community based nonprofits formed the University Avenue Business Preparation Collaborative—which has since come to be known as “U7”—to help existing small businesses on University Avenue in St. Paul prepare to survive the construction of the Central Corridor Light Rail Line and thrive after its completion.

1. Results-Driven Marketing Free one-on-one business marketing and communications consulting. 2. On-Site Business Consulting Professional specialists in all business areas, with a focus on financial health consultations. 3. Business Resource Center and Business Planning Center Computer access, free consulting services and information on all business-related issues at the Rondo Community Library and the SBC Business Planning Center (near Hwy. 280). 4. Grants Marketing and façade improvement grants.

5. Small Business Workshops Many business topics available for free at Rondo Community Library, including but not limited to: • Marketing (accounting, marketing, branding, online advertising) • Website development • Demographic analysis • Recordkeeping • Website development • Cash flow projection • A new workshop titled “Survive LRT - A Ten Step Guide” 6. Financing Working capital (5.5%) interest rate, business expansion and real estate financing.

PARTNER ORGANIZATIONS The following organizations--in partnership with the neighborhoods and business owners along the corridor--comprise the University Avenue Business Preparation Collaborative (U7): African Economic Development Solutions (AED Solutions) Aurora/St. Anthony Neighborhood Development Center (ASANDC) Greater Frogtown Community Development Corporation (GFCDC) Hmong Chamber of Commerce Metropolitan Consortium of Community Developers (MCCD) Neighborhood Development Center (NDC) Selby Avenue Community Development Corporation (SACDC) Sparc

STAFF Mike Temali NDC President & CEO Isabel Chanslor U7 Project Manager Miguel Jongewaard NDC Loan Officer/Business Advisor and U7 Small Business Consultant

NDC is the host organization for this collaborative effort that is focused on strengthening management and marketing capacity.

Steve Olson NDC/U7 Lead Graphic Designer

LEFT TO RIGHT: MARILYN PORTER, MIGUEL JONGEWAARD, ISABEL CHANSLOR, SIA LO & STEVE OLSON

Marilyn Porter Small Business Consultant, employed with ASANDC Sia Lo Small Business Consultant, employed with GFCDC

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Financial Statement

Financ ial State me nt

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (DECEMBER 31, 2009)

Assets Cash and cash equivalents Contributions and other receivables Loan receivables, net of allowance for loan losses Rental properties and equipment, net Other assets

$1,767,220 $929,963 $3,432,547 $13,819,583 $409,331

Liabilities and Net Assets Liabilities Payables and other accruals $894,416 Notes payable $17,034,382 Total Liabilities $17,928,789 Net Assets Unrestricted net assets Temporarily restricted net assets Total Net Assets

Total Assets

$20,358,644

$1,462,346 $967,500 $2,429,846

Total Liabilities and Net Assets

$20,358,644

CONSOLIDATED STATEMENT OF ACTIVITIES (DECEMBER 31, 2009) 1%

45%

14% 34%

7%

10% 20%

19%

Revenues & Support

Key Government Partners

City of Minneapolis City of Saint Paul Community Development Financial Institution Board Hennepin County Library Minneapolis Empowerment Zone Rondo Community Outreach Library U.S. Small Business Administration Office of Community Services Saint Paul Port Authority State of Minnesota

Corporate and Foundation

Allina Health System Campbell Foundation Deluxe Corporation Foundation F.R. Bigelow Foundation General Mills Foundation H.E. & Helen Warren Foundation Heron Foundation Marbrook Foundation Marquette Financial Companies Minneapolis Foundation Nexus Community Partners Piper Jaffray & Co. RBC Dain Rauscher Foundation Securian Foundation The Fredrikson & Byron Foundation The Jay & Rose Phillips Family Foundation The McKnight Foundation The Saint Paul Foundation Travelers Foundation US Bancorp Foundation Valspar Foundation Wells Fargo Foundation Minnesota Western Bank

Individuals

8%

16%

FINANCIAL SUPPORTERS

26%

Expenses

Grants and Contributions — $2,203,329

Incubator Program — $1,514,457

Management & General — $320,616

Incubator Rent — $940,462

Incubator Operations — $1,184,283

Lending — $641,754

Earned Income — $801,253

Microentrepreneur Training — $371,133

Fundraising — $38,658

Government Grants — $1,004,047

Technical Assistance — $428,485

Notes: (1) The financial statements recognize revenue for pledged contributions as per statement of FAS #116. There were multi-year grants that were recognized in prior years. We continued to fulfill program commitments with restricted funds received in previous years. (2) The financial statements are the consolidation of subsidiaries including Frogtown Entrepreneur Center, LLC; Mercado Vista, LLC (Plaza Verde); NDC REDI, LLC; NDC REDI II, LLC and NCS, LLC (Midtown Global Market). (3) Incubator operation subsidy and NDC overhead contributed.

Alicia Cordes Tim Boberg Leila Poullada Greg & Janice Dames Pamel Wandzel James LaFave Paul Engh Anthony Leonel Lemaire Steve Erdall Michael Christenson Julie Sands Causey A. William Sands Jeff Alexander Avan Suguelle Luke Weisberg Samir Saikali Bonita Martin Cristina Edelstein Ben Goldfarb

Kathy Moriarty Erik Takeshita Elizabeth George Earlsworth Letang Anthony Genia Paul Ginger JoAnna Hicks Edward Padilla Susan Roe Brian Singer Mihailo Temali Daniel Flicek Missy Thompson Marcus Weiss Kate Barr Mike LaFave Arvid Povilaitis Emily Maltz

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663 University Avenue, Suite 200 Saint Paul, MN 55104 Phone: 651-291-2480 Fax: 651-291-2597 www.ndc-mn.org

Building Neighborhoood EconomiesFrom Within

Bu ilding Ne igh b orh o od E c onomie s From Wi th i n

Coordination by: Kathy Moriarty kmoriarty@ndc-mn.org Maren Misner mmisner@ndc-mn.org

Design by: Rachel A. Carlson design@rachelanncarlson.com


NDC Annual Report 2009