Minneapolis NRP: News: In the News

Legally non-profits, they act as representatives of residents, planners for spending public dollars and advisors to the City Council

Brent Killackey, Southwest Journal

June 26, 2000

Ten years ago, the Neighborhood Revitalization Program - designed to empower Minneapolis neighborhoods and improve the quality of life of the city - kicked into gear.

From building community centers to helping residents afford home improvements, neighborhood organizations have used the program's resources to bring about dramatic changes in the city.

The program also has brought about dramatic changes within neighborhood organizations, many of which barely existed before the infusion of NRP resources.

"We can look at citizen-participation models all over the country, and Minneapolis has one of the most effective for citizen participation," said Joe Barisonzi, board member of the Minneapolis Center for Neighborhoods.

Neighborhood organizations act as the planners for millions of dollars in NRP resources. City officials also turn to these groups for input on variances and other development requests.

"I don't think people know how much authority the City Council has handed over to these groups," said Mark Anfinson, attorney for the Minnesota Newspaper Association.

Legal status

By legal definition, neighborhood organizations are not government entities, even though they serve a function that almost looks like that of a mini-City Council. Most non-profits serve an issue, while neighborhood organizations serve a specific geographic area. But neighborhood organizations are non-profit corporations under state law, and some even have tax-exempt status.

"Their roles are different from government entities," said Bob Miller, director of NRP. "They don't have any statutory power. They don't have the ability to tax. The only way they can accomplish things is by organizing and raising money or influencing public officials."

Neighborhood organizations are designed to be inclusive, but non-profit law requires that members be signed up 30 days in advance to vote at the annual meeting.

Rep. Jean Wagenius (DFL-Minneapolis) wants to change the law to allow any resident who shows up at a neighborhood organization's annual meeting to vote.

"The non-profit law basically was designed for a membership organization based on dues," Wagenius said. "It wasn't contemplated to have a membership based solely on geography."

Wagenius has introduced a bill - House File 404 - that would create a subclass under non-profit law for neighborhood organizations.

The Open Meetings Law (Section 13D for the Minnesota State Statutes) requires government meetings to be open except when discussing the following:

Evaluation of employees.
Matters subject to attorney-client privilege.
Non-public data relating to education, health, medical, welfare or mental health records.
Data that would identify alleged victims or reporters of criminal sexual conduct, domestic abuse or maltreatment of minors or vulnerable adults.
Active investigative records from law-enforcement agencies.

Although neighborhood groups plan how to spend millions of dollars of NRP funding, as non-profit entities, they are not outwardly required to follow the Minnesota Open Meetings Law or Data Practices Act, both of which provide for open government.

"Minnesota Open Meetings Law and Minnesota Data Practices Act do not extend to private non-profit organizations, even ones which receive large sums of public funding," Anfinson said.

Anfinson said that this carries some risks: "The risk is the same as it is in all cases where public access is severely limited or non-existent, that a variety of undesirable occurrences can happen, ranging all the way from simple surprises inflicted upon local citizens by what amounts to elites all the way up through insider and special dealing, preferences granted to those within the power circuit and, eventually, corruption at the far end of the continuum."

MCDA and NRP administrators have built safeguards to prevent groups from secretly meeting and creating private agendas.

Organizations that accept MCDA citizen-participation grants - generally, several hundred dollars to fund newsletters, advertisements, mailings and other efforts to get people involved - agree to operate openly and inclusively, said Bob Cooper of the MCDA. Neighborhoods must submit their bylaws for review.

For the MCDA, this means allowing business owners to join and removing dues-paying requirements. Some neighborhood groups object to these provisions, or simply don't want the taxpayer dollars and decline the funding. Two Southwest neighborhoods, Kenwood and Lowry Hill, do not receive citizen-participation grants.

Participation in the Neighborhood Revitalization Program is almost universal, and acceptance of NRP funding carries a contractual requirement that neighborhoods abide by the principles of the Open Meetings Law when doing NRP business.

"We push the openness," Miller said, "encouraging neighborhoods to try to perform at that level."

By and large, neighborhood groups in Southwest Minneapolis recognize a need to operate openly and inclusively, without pressure from government officials.

"We just decided we've got public money and we should act in a public way," said Barret Lane, former chair of the Fulton Neighborhood Association and currently the City Councilmember for the 13th Ward.

Bob Vose, a member of the Linden Hills neighborhood council, agreed that openness is better. "The alternative is creating suspicion and problems that we don't need to have."

Peter Nussbaum, a board member in Lynnhurst, says he doesn't feel like an elected official because, often, anyone who shows interest in the board can find an open position to fill.

"The Lynnhurst board consists of the people willing to volunteer the time to be on it," Nussbaum said. But he said there still was a need "to act as an elected official and solicit as much input as we can and represent as broad neighborhood concerns as possible."

Does serving on a board mean acting as an elected official?

Bob Vose, Linden Hills Neighborhood Council: "I don't view myself that way. I don't feel like a politician. There's just no sense that an entire neighborhood is voting you up or down."
Meg Forney, West Calhoun Neighborhood Council: "I personally feel I'm an elected representative of the community, and I try to strive to get other people to feel the same way."
Bob Miller, director of NRP: "I don't see them as being the equivalent of an elected official, but they are a representative."
Barret Lane, former Fulton Neighborhood Association chair and currently City Councilmember in Ward 13: "We thought of ourselves as neighborhood volunteers."

Advisory, but powerful

Technically, neighborhood groups serve an advisory role. They may get an opportunity to weigh in on variance requests, but the City Council has the ultimate responsibility to rule. Even NRP plans must follow certain guidelines, such as funding capital expenses rather than operation costs, and meeting a 52.5 percent requirement for spending on housing programs. NRP plans must be approved by the NRP policy board, a governing body made up of representatives from neighborhoods and a variety of governmental agencies.

Even though the neighborhood boards are advisory, they have enormous power to shape the direction of a neighborhood.

"Neighborhoods can more directly affect the development agenda than they have in the past," said Steve Cramer, executive director of the MCDA. Having resources to bring to the table has dramatically changed their influence.

"There's a vesting of responsibility from NRP in spending our allocated dollars, so it's more than advisory, because the board is the one that determines how those dollars are spent within the NRP guidelines," said Debbie Evans, co-chair of the Linden Hills Neighborhood Council.

Would it make sense to change neighborhood organizations into governmental entities because of the enormous power they wield?

Barisonzi says no.

"It's headed down the wrong track to bureaucratize the neighborhoods into quasi-governmental or even governmental agencies," Barisonzi said. "Government does not do a good job involving and engaging residents; the non-profit sector does."

"If there is an effort to turn them into quasi-governmental agencies, it will bureaucratize them and make them ineffective in meeting the needs of the residents because ownership will shift from residents to government," he said.

One of the visions for neighborhood groups involved creating a long-term influence over city, school and county policies - a healthy sort of tension between citizen desires and policy makers managing public resources.

"Practices and policies, and even the legal authority of city government, could be influenced by what the neighborhoods developed, but the city had a responsibility to push back with its own frame," said Rip Rapson, former deputy mayor and currently executive director of the McKnight Foundation. "Where is that circle of intersection where the city's practices have been changed by neighborhood work, and the neighborhoods have been more effective by having the benefit of city policies and practices?"

In some cases, NRP has helped shape larger city policies. Mostly, however, it has just been a funding source for smaller, short-term capital efforts, Rapson said.

Early in the NRP program, the Whittier Neighborhood proposed building a community school and brought NRP dollars to the table. At first there was resistance, but a community schools study was launched and, a few years later, the community schools movement swept across the district.

Would this community schools movement have taken place without Whittier and NRP? Possibly. But Whittier certainly precipitated the conversation, Rapson said.

In Lynnhurst, the Park Board has stalled on installing emergency phones along the Minnehaha Creek trail because of concerns about increased maintenance costs, which cannot be covered by NRP.

"The Park Board has a point," Rapson said. "How many neighborhood priorities get pushed into the midsection of its budget without the Park Board closing ice rinks and programs?"

The future

While NRP has empowered neighborhood organizations by giving them resources, it has sometimes buried interest in other neighborhood needs and activities. "The NRP has in many ways overwhelmed neighborhood work with the role of being key planning agents for the program," said Gretchen Nicholls, director of the Minneapolis Center for Neighborhoods.

Some neighborhoods struggled with the need to maintain other community building operations with NRP.

"Maybe we might be doing more grass-roots type of things," said Forney. "More corny get-togethers. Clean the streets. Putting more energy into pot luck, block party, community-building types of things."

Dealing with contentious development issues or focusing on traffic calming can divide a group rather than bring it together, Forney said.

What happens after NRP?

Will participation and neighborhood-based power die after NRP ends in 2009? Not if neighborhood boards keep serving as representative voices of the neighborhood, some say.

"They are a non-political way to get involved in a neighborhood and access, in a very basic way, their local government," Lane said.

"They're truly a bastion of democracy, and their power comes not from NRP funds or any other funds, but from their ability to say truly that they're representative of the neighborhood and their motions are not just representative of the 15 people on the board," Cooper said. "That is why people are going to listen to them. That's where their true power lies."