Collaboration is the Key
As CEO and president of the Southern Minnesota Initiative Foundation, former congressman Tim Penny is using his extensive political connections and cachet in a determined effort to help southeastern Minnesota's business economy soar
BY ANDREA STRAND
The dog days days of summer 2007 were ruthless and brutal to southeastern Minnesota. A series of violent storms spawned flooding on an almost Biblical scale, with more than 17 inches of rain leaving more than six people dead and scores of southeast riverfront communities ravaged. Every building in the Rushford downtown business district was seriously damaged. And with strained media resources still assigned to the outcome of the tragic I-35W bridge collapse, news coverage was somewhat slow to change focus.
A few months earlier, former Minnesota congressman Tim Penny had been named CEO and president of the Southern Minnesota Initiative Foundation (SMIF). With federal assistance for flood victims still weeks if not months away, Penny saw an opportunity to put into action the support for which SMIF was created.
Penny’s previous government experience, in part, helped expedite the 2007 relief efforts. “I think my political background helped me to be aware of who to reach out to and, as a result, I think that we played a very instrumental role in the relief efforts for those towns,” he said.
Local businesses that provide groceries and other essential supplies were a first priority, as their recovery would mean that residents would have access to necessary resources. Within 24 hours of the floods, SMIF made the decision to establish a business-recovery fund through which business owners could apply for relief grants. The fund was coordinated with governmental programs offering assistance to the same businesses. But where most government sponsored relief efforts were not immediately available, SMIF grants were offered to businesses within weeks.
More than $800,000 was given to SMIF by 21 organizations to distribute to 116 businesses as they repaired and rebuilt in the aftermath of the floods. The amount of grant money available through SMIF was abundant because many donors saw SMIF as the quickest way to get help to those affected. “We attracted donors who otherwise would have had a hard time getting their contributions out to that corner of the state,” Penny said during his April 22 keynote speech at the Hubert H. Humphrey Institute. The Minnesota Department of Employment and Economic Development provided about $250,000 of that amount, seeing SMIF—one of six such foundations throughout the state—as a vehicle through which to get initial grants to victims before the majority of government-sponsored funding was available. Twenty additional organizations, including AgStar Financial Services in Mankato, the Mayo Clinic in Rochester and the Blandin Foundation in Grand Rapids, made contributions.
Brad Hoiness of Rushford Foods, which alone sustained $750,000 worth of damage, remembers the hope that the SMIF grant instilled. “The grant presentation itself was a very important time in our recovery,” Hoiness says. “It was a breath of fresh air during a very difficult and stressful time for us and for our employees.” The local grocery store was able to reopen on Oct. 31.
For Penny, the relief effort was another opportunity to serve his former Minnesota district by helping many of those same constituents—and their budgets—on an intimate and personally rewarding level.
A MODEL FOR SUCCESS
Most of southeastern Minnesota, especially along the Mississippi River, is a renowned nesting sanctuary for bald eagles. They soar through the thermals in and around the undulating hills and often pluck meals from the Big Muddy’s fabled waters. Like these once endangered birds of prey, Penny believes the SMIF model can become a symbol for regional economic rejuvenation and renewed competitiveness.
This spring, Penny, along with futurist Joel Barker, led the 2008 University of Minnesota Center for Integrative Leadership conference, entitled “Making Communities Work: Leadership Across Public, Private, Nonprofit and Geographic Boundaries.” In his keynote address to attendees ranging from business leaders to nonprofit directors and volunteers, Penny emphasized the importance of collaboration among business, nonprofit and government sectors. “We need to break down the silos and start thinking together, on a regional basis,” he says.
Loans and grants are helpful tools for initial business improvement, and SMIF does distribute modest loans to small businesses across the region. The organization also allocates what are called “incentives grants,” one-time funding intended to help jumpstart programs or activities. However, it is SMIF’s identification of business- and work force-related needs extending across the entire age spectrum of Minnesota residents—from preschoolers to senior citizens— that renders this assistance so valuable.
“Collaboration is the key word,” Penny said during his address, as if to etch the term onto everyone’s mind. “We can be a trusted partner in bringing groups together that might not otherwise easily come together.” SMIF unites community leaders from different sectors such as governmental, faith based, educational, artistic, business and nonprofit organizations to discuss and address concerns in asset-based community dialogues.
While uniting an entire region is no easy task, and takes the cooperation of everyone, Penny has the experience to lead this effort. Born in Albert Lea and raised in southeastern Minnesota, Penny graduated from Winona State University. He was a member of the Minnesota State Senate from 1976 to 1982, then served 12 years in Congress, representing Minnesota’s First District. Most recently, Penny was a senior counselor at Himle Horner, a Twin Cities-based PR and public affairs firm, and co-chair of the Humphrey Institute Policy Forum at the University of Minnesota.
Under Penny’s guidance, SMIF has returned to its roots. Since its inception in 1986, the McKnight Foundation-funded organization has explored several approaches to stimulate the economy of its 20-county region in southeastern Minnesota. Grant making, loan making, community development and a focus on leadership were all strategies emphasized in past years. SMIF has enjoyed great successes with those strategies, evident in an impressive $19.5 million invested to support more than 350 businesses, and employment for more than 6,500 workers. But Penny sees SMIF returning to what it does best: providing direct, face-to-face assistance to businesses and the work force.
Working in several communities on early childhood development—what Penny calls “a long-term bet on a future quality work force”—will help fill the gaps in early educational programming, such as lack of learning resources. “Many of these kids will be workers in 12 short years,” Penny emphasizes. “It’s all of us that have a stake in the best early childhood development we can provide in each town.” SMIF’s BookStart program donates books and literacy programming to children as they learn to read. Young Explorer Learning Centers, child-friendly computer stations donated to SMIF by IBM, provide an interactive learning experience that is ideal for visually oriented students. Additionally, home visitation programs may apply for grants through SMIF in order to improve and increase visitations and the overall health of children in the region.
SMIF also caters to the needs of senior citizens who want or need to stay in the work force, and helps high school graduates and new immigrants begin their careers. By partnering with companies in the region, SMIF’s mission is to educate businesses and communities about ways to help both seniors and those entering the work force. For senior citizens, the organization encourages companies to offer flexible and part time schedules. For people entering the work force, SMIF works with communities that provide on-site training for employees to be successful in entry-level positions, and also focuses on opportunities for immigrants with limited work-readiness skills.
LOOKING AHEAD
For businesses, SMIF facilitates peer council discussions among business leaders to focus on challenges and opportunities they see in their own companies. Penny is a strong believer that “a triangle of stakeholders,” among foundations, public institutions and the private sector, is what allows communities in the region to keep seeing economic improvements. Loans and grants do allow for immediate improvement, but it’s the solidarity among these groups that will ultimately facilitate continued success. “We’re really trying to create a response that can be sustained over time,” Penny says of the organization’s collaboration efforts. “It’s the process we’ve created that allows a community to look differently at how they can pool resources to address other needs.”
SMIF is showing a keen interest in Minnesota’s bio-businesses. “We’re trying to do more and more business support work in the bio-business area because we view that as the greatest potential for growth in the state,” Penny says. Because suppliers, service industries and other jobs are tied indirectly to the biobusinesses themselves, the number of jobs that stem from bio-businesses is huge. That growth would give Minnesota’s economy an impressive boost, its quality jobs paying 50 percent more than the average wage.
With that in mind, the organization has formed a partnership with the Bio-Business Alliance of Minnesota. To get a clearer picture of the opportunities available in this industry, SMIF and the Alliance are working to create an asset map detailing bio-business assets. The map is a veritable inventory of available resources in the southeastern corner of the state, from work force to research. Penny hopes that the maps will assist SMIF as it recruits new bio-businesses and helps existing businesses and community leaders to grow. If they are successful, asset maps for the other five initiative foundations around the state will be made as well.
Penny is also working to devise a success gauge for each of SMIF’s primary areas of involvement: early childhood, high school students looking to enter the work force, senior citizens that want or need to remain in the work force and new immigrants. “We’re looking at creating dashboard indicators in each of these priority areas, recognizing that we are just one of several players trying to invest in the region and create success in these areas,” Penny says. The goal is to provide statistical indicators of yearly success in each of the project areas in order to measure the progress made from year to year within the region. To make an impact across the region, the results will be shared with public institutions and the private sector, in addition to the other initiative foundation regions. “I think it just helps to raise awareness and consciousness and encourage continued efforts by all of these sectors to advance the region’s economy,” Penny says.