Community Vitality Center Board Meeting Minutes

January 5, 2011, 10:00 A.M.
Scheman 204, Iowa State Center, Iowa State University, Ames IA


Staff and Guests in attendance - 3

Meeting called to order by Curt Heidt, vice-chair, at 10:05 AM. There were no items added to the agenda. Minutes from the October 13th, 2010 Board meeting were distributed and Heidt asked for comments or corrections. Motion made by Hamilton and seconded by Halliburton to adopt minutes as written. No further discussion, motion carried unanimously.

Edelman noted the Distinguished Leadership Venture Award that the CVC received from Iowa Area Development Group.

Edelman reported that since the omnibus federal budget bill had died, Congressionally Directed Appropriations were gone, at least for one year. Edelman is meeting with Bill Menner, State Director of USDA Rural Development to see if some of the mini grant proposals could be funded through the USDA-RD Grant Programs. RBEG grants might be appropriate for some of the mini grant proposals. The RBEGs are a competitive process so there is no assurance that they would receive funding. It is anticipated that approximately $400,000 will be available through RBEG for the entire state so there is a limit as to what could be requested. It may be possible to use email or a subcommittee discussion to determine how to submit the proposals. Houghtaling asked if the CVC would be the applicant. Edelman said the CVC has a five year history and could submit, but if more than one is submitted then that is a detriment for the second request. The CVC would have to request a 26% indirect rate through ISU but there was also a precedent as the USDA funded a 26% rate for ISU value added agriculture. It might also be that the CVC would partner with a regional entity that would submit for the mini grants. Erb asked when the budget year began and what was a timeline for needing decisions. Edelman said that the CVC works with three budget years. Any proposals or grants applied for would need to include funds for CVC operations. The CVC was on track to honor all mini grants approved up to this point. There was a bit of a financial cushion because of Ron Prescott working in Ghana. Edelman’s salary is financed by ISU and he has enough flexibility to retain Burke without extra funding for about two years. ISU would not likely allow CVC requests for a 10% indirect in the current environment. Fisher asked about using the IFMCV as the grant applicant. Edelman said that it does not have a five year history. Collins-Williams asked if some of the funding that is not committed may also be at risk. Edelman said that there is a signed contract with USDA and ISU has executed subcontracts. Edelman indicated that there may be a small chance of that occurring, but most of the focus is on FY11 and forward budgets. Fisher asked what was the RBEG amount. Edelman said $99,000 was the maximum a proposal could be submitted for without loosing points. Proposals loose points when the amount go over $100,000. Heidt commented that he has heard of funding at the federal level that might be at the direction of the director and can be applied for.

Edelman gave updates on the Rural Entrepreneur Roundtable and the IDED LEAN meetings. Ehrig noted that the E-Team was an initiative from the legislature to review small business and entrepreneurship development. More than 20 groups were represented at the weeklong set of LEAN process meetings with IDED. Issues raised at this were 800 call access with a real person on the line to direct, point of entry, inter-linkage among web sites, and a small business assistance alliance. CVC was asked to organize a task force to look into matching and leveraging funds at the federal state and local level to maximize benefits for Iowa’s entrepreneurs.

Burke reported on the SE Iowa interviews of entrepreneurs and economic development leaders and distributed the written report. Edelman noted that there is further discussion on collaboration to pursue SE Iowa goals with the RUPRI Entrepreneurial Center, Nebraska Food Product Development Center, ACEnet of Ohio, and Iowa Institute for Cooperatives. Three seminar meetings where CVC is sponsoring the Institute for Coops presentation on organizing a local food coop using the 501A Coop law are organized for February.

Edelman said CVC was sponsoring a Fast Trac Instructor Certification Workshop for selected Main Street Directors, IFMCV Affiliate Coaches, ISU Extension, and Horizon Community coordinators in February.

Edelman gave updates on the Leopold Center’s Iowa statewide local food systems development plan that was requested by the General Assembly last year. CVC was invited to a meeting where the announcement will be made. ISU Extension Administration hosted a meeting on entrepreneurship and creation of a business plan competition for youth by Extension regions for 4H. CVC offered to match a donation from Underwood to sponsor the first year initiative. Edelman encouraged 4-H program developers to use a curriculum along with plan completion.

Edelman noted that the ISB Loan Program was one of the programs being considered for de-appropriation in the plan presented by the new administration. Foster noted that if that would pass, it would take the money regardless of the March deadline. Foster also said that there is another bill in the legislature that would expand the open records law to any 501c organization getting public money. This would be another extra scrutiny. Fisher said that there were some cautions and that some boards were not trained to comply and that this would have an impact on volunteerism. There were concerns for community foundation boards and how they functioned and the confidentiality of the financial information. Foster said that the bill just expands the code but doesn’t state who would implement it. Pantini noted there was a similar bill last year that did not make it out of committee. Developers were concerned about confidentiality issues.

Edelman noted the map of applicants from the ISB program and location of SBDCs. Downs gave updates on IFMCV. Thirty-one loans with $545,000 outstanding and one loan paid off. Five more in process, 36 approved, 156 applications received, averaging 1.5 jobs per application approved. The IFMCV TA staff is averaging 300-400 hours a month and there are starting to be some nice dividends from these contacts and work. A $500,000 loan pool for a Pilot Main Street Development Loan Program is available, as well as $400,000 from USDA RMAP for loans and $100,000 for TA which will be available in January. RMAP is for nonmetro areas only and since it a brand new program all the rules have not yet been determined. There are 6 towns in the Main Street Development pilot project are Charles City, Greenfield, Sac City, Iowa Falls, Bloomfield, and Valley Junction. Downs observed that there were several businesses helped by TA in which IFMCV didn’t end up financing as they found conventional loans after the TA. There are three loans during the first two years that combined for total charge offs of approximately $75,000. The provision of TA and making site visit contacts right when businesses are getting started provides the client with a better chance of success. Edelman added that many entrepreneurs don’t like the accounting part. With TA staff to do “on site hands on TA” it is very helpful to the client and IFMCV’s bottom line sustainability. Types of businesses include hair salons, IT business, shirt manufacturer, bus tour operator, heating and cooling, several value added ag projects, a restaurant, coffee shop, shoes. Heidt asked if could post and promote these on the web site. Downs said yes because they sign releases when they close the loan. A goal for 2011, is to market client success stories.

Raber proceeded to begin the review and discussion of the mini grant proposals and ratings. Ten reviews were received; ratings compiled into 3 categories: A= approve; AR=approve with recommendation/revision; D=disapprove. Heidt noted that several had just one reviewer denying approval.

Foster raised an issue of potential conflicts of interest when CVC board, staff, or subcontractors are involved in CVC proposals. Edelman said that in the past, projects have been approved if a board member was involved but those involved were asked to identify their potential conflicts of interest, they would abstain from discussion unless asked questions, and then they would abstain from voting on that proposal. The Boone project has a local steering committee separate from IFMCV in the example raised. Erb said he was looking to mini grants that added something new and that perhaps only five should be approved because $50,000 might be the maximum that could be funded this year. Edelman said that the USDA priorities were local food systems and entrepreneurship.

General comments included the following:

Foster noted that the Ida proposal could be operated as a private business, and Pantini agreed.
Foster also noted that the women and leadership proposal did not have an orientation to either entrepreneurship or philanthropy. Erb said it was very similar to other leadership activities. Fisher said that it was a worthy target audience but he was concerned about the integration and partnering.
With regard to the ISUE Horizons project, Foster said that they would be offering classes but was wondering what would happen after the classes. There was no follow up. The Hardin Co philanthropy project was discussed next.

Break for lunch.

Fisher raised concerns about developing a strategy for the CVC to continue. Hamilton wondered if the CVC could continue with private entities making donations. Edelman said there was potential for discussions with the Northwest Area Foundation and that ISU Administration has requested a CVC transition plan. Morain said that the Kellogg Foundation had a high interest in entrepreneurship. Raber noted that the projects related to local foods might be appropriate for the Leopold Center. Morain asked if the Kauffman Foundation would have any potential. Heidt noted that IFMCV had recently received Bank of America for funding.

Raber directed the discussion back to the MiniGrant Proposals and the IA Valley Food Coop. Smith said this project was with the local food people and the RC&Ds. There were supportive comments from Morain, Raber, and Halliburton. Fisher thought that the Leopold Center could be a better place for local foods projects. Smith said this was a proposal to address the bottlenecks and distribution issues of local foods.

Halliburton asked if there were any of these that should be pulled out and that should not go forward as possibilities? Erb was focusing on what the upcoming meeting with Menner would be about and what that conversation with regard to the CVC projects might be. Edelman said that several of the mini grant proposals might fit into the USDA granting priorities.

Raber directed attention to the Louisa Co LIFE proposal. Morain expressed concern about the travel component of the proposal. Smith said that their approach and steps were all oriented toward technology and would likely not work in contacting the Hispanic target population. Chojnowski was not supportive of a bus to visit the Grameen Bank, but that a good team was in place locally.

Raber directed attention to the Boone philanthropy and entrepreneurship demonstration project. Erb expressed concerns about the relationship of entrepreneurship and its synergy with philanthropy in this proposal. Morain asked about clarification of having raised money locally in 2006 for the prize. Edelman said they had raised $10,000 then. Edelman said (and Foster in the am) that the budget was not clear and could be improved to clarify sources and uses of funds.

Raber directed attention to the Fairfield proposal. Chojnowski said it was to form a cooperative. Raber thought that it might be spread out too much and should be focused on one thing. Smith disagreed because of the opportunity to bring in multiple businesses.

Raber directed attention to the Southern RC&D proposal. Erb thought it was similar to the Iowa Valley proposal but not as strong. Smith thought that the emphasis on building networks was where they need to focus but disagreed with the focus on going out of state to use the Growing Power group from Wisconsin. Smith said there were other networks they could work with in Iowa. She liked the youth emphasis. Pantini said they had been working on getting together for 6-8 months.

Erb moved to take these to the USDA with the scores and ranking and then find out where they stand with getting any funding from that source. Then to have a CVC executive meeting or an electronic meeting to decide how to proceed further. Seconded by Morain. In discussion, Halliburton noted that there was a break in the projects six and seven and that seven through nine scored lower. She also said that for today, these really can’t be taken any further until see how they would fall into areas with the USDA. Fisher said that Menner's technical staff will be critical for determining how this could be packaged and how these could go forward. Smith asked if all should be taken to the USDA. Ehrig said yes, that they should take all. Halliburton said that she would support taking the applications and rankings and then see where they stand. Motion carried unanimously.

Raber said that Smith might attend the meeting with Menner along with Mark. Edelman said that after Friday he would discuss the meeting with the executive committee and then have a conference call to see how to distribute the information.

Board reports: Ehrig noted that the Renew Rural Iowa meeting would be in Dennison on January 27th. Heidt said that they have restructured loan targets with some targets of small business and local foods. Smith reported that she was elected to be vice-president of the Board of the Iowa Food System Council. Fisher said that the Iowa Rural Development Council has been reconstituted. Erb said that he is on the steering committee for the aftermath of the 2008 flood and that the Charles City whitewater river project is going forward and the new pedestrian bridge has gone up. He will be the chairperson of the northern Iowa Council of Government. Meier has been elected to the Sioux Co Extension Council. Chojnowski has finished editing an edition of Fairfield magazine on an entrepreneur from there.

Meeting adjourned at 2:30 pm.