Balancing the Mission Checkbook

I’m asking this question in the context of neighborhood and community development planning. In these conversations, nonprofit organizations are usually engaged as providers of services and as advocates. Community development nonprofits, for example, create housing, train entrepreneurs to launch small businesses, and facilitate community planning and participation. But what about the nonprofit organizations themselves – are nonprofits desirable and valuable as neighbors to include in community development planning? Unfortunately, nonprofits are not always viewed as a component of economic development – and sometimes are seen in quite the opposite light. We had an illustrative experience a few years ago. Nonprofits Assistance Fund’s loan funds provide credit to nonprofits for both working capital and facilities. We applied for capital funds in response to an RFP for funding to spur business growth and job creation in some targeted neighborhoods. We are denied funding with the comment that they didn’t want to encourage more nonprofits to locate in these neighborhoods. What they wanted were small businesses like restaurants and retail shops. Nonprofits were viewed as service providers and fundraisers, not as employers and economic entities. Economic development press releases frequently cite how many businesses were started and grew in the last year – but have you ever read a celebration of how many new nonprofits were started or grew in the same year? Why is there a disconnect between nonprofits as essential service providers and nonprofits as community businesses?

We have a case study for this question in Saint Paul and Minneapolis as the light rail transit Central Corridor line is planned and developed. This 11 mile route will link the downtowns of Minneapolis and Saint Paul via the University of Minnesota campus and University Avenue. The corridor along University Avenue has been a magnet for nonprofits for years because of the proximity to both cities, easy access, and affordable rents and real estate – there are about 800 nonprofits currently located in the Central Corridor. The city of Saint Paul has already invested considerable effort in creating a development strategy for the Central Corridor with a framework for “neighborhood revitalization, reinvestment and growth”. Fortunately, many nonprofits are engaged in the process already. I encourage everyone to think of the role of nonprofits as both advocates for the community and as small and medium-sized businesses who have much to offer the community as employers, sources of economic activity, community assets – and as good neighbors.

There has been some research and discussion about the role of nonprofits as both providers and as community development assets. One interesting publication is Tom Borrup’s Creative Community Builder’s Handbook: How to Transform Communities Using Local Assets, Arts, and Culture published by Fieldstone Alliance. Please post a comment or send me an email about other resources on the topic.