In the Spotlight

News & Features
Make Change, Not Money
Part 5: Nonprofit Small Town
By American RadioWorks
September 3, 1998

Maybe it's a cliché, but America is a nation of immigrants. In the past fifteen years alone, more than 13 million newcomers settled in the U.S. Economist Burton Weisbrod says diversity is a major force behind the growth of America's nonprofit economy.

IN A DEMOCRATIC SOCIETY, THE ROLE OF GOVERNMENT depends very much on the ability of the population and their representatives to come to a consensus. In a homogeneous society, Sweden might be an example, people are much more like each other than is the case in the US, and it is much easier for them to come to a consensus of what they want from the public sector.

In some places, American's have discovered that the easiest way to find common ground is through a nonprofit. In western Iowa, there's one small town that basically sees itself as a nonprofit organization. Like many agricultural towns, Manning, Iowa, was badly buffeted by the farm crisis of the early 1980s.

Ron Colling, Newspaper publisher: Fifteen years ago, I would have said there wouldn't be anybody in town. It would have been, "Lock every door," because of the way things were going. It was not good. Not good.
As he stands on Main street, Colling points out that even though Manning has half the businesses of its heyday, the little town is still relatively prosperous. Plenty of new cars are parked along the red-bricked Main street. There is a family-owned bank, a hospital and nursing home, and a four-room hotel. How did Manning do it? In part, Colling says, by forming a couple of nonprofits to boost the town's fortunes. The organizations allowed towns folk to set aside the profit motive.
Colling: More or less nonprofit created unity because nobody was going to get more than anybody else, mainly nothing. And we don't have an empty store on mainstreet. Not one.
With just 1,500 residents, Manning is so small that if you want to find someone, just call down to Deb's corner café. Most everyone stops there at least once a day. Over breakfast and many cups of coffee, Gilbert Phillips and other town leaders explained that nonprofits are the hub supporting the town's profit-making businesses.
Phillips: This town is very much nonprofit, and that's why we have survived. Because remember, we're independent out here. If were are going to survive into the 21st century, and if we're to prosper, we'll have to do it ourselves.
Manning created three separate nonprofits to spark economic development. The most ambitious plan will wire Manning and several other small Iowa towns to a fiber optic communications network. That gives them a high-speed computer link to the world. It's a way of getting the new digital crops from rural Iowa to the international technology market. Town banker Howard Roe believes that with the fiber-optic hookup, the town can draw small, high-tech firms from expensive coastal cities to a pleasant little town with educated workers and low wages.
Roe: You know, for us it's like when the railroad came through or a super highway. It gives up opportunities we didn't have before.
Manning is no Silicon Valley. Far from it. But in a high-tech world, business can be done anywhere people want to live, including rural America.
Operator: Thanks for calling Mitsumi.
Last year, a company called ECI, opened a small office in Manning. The Des Moines-based company runs telephone help lines for computer users.
Operator: Okay, can I get the city and state that you are calling from please?
ECI employs ten local workers and pays them $8 to $11 an hour. Decent, though not spectacular, wages for this part of the country. The company plans to expand in Manning, in large measure because the town's nonprofits have made the move financially attractive for the high-tech firm.

Across town at the John Deere farm implement dealership, Warren Puck is no newcomer to Manning. His grandfather started the business. Puck is active in the Meaning's nonprofit schemes. He hopes high-tech jobs and better amenities will stem the migration of educated people from the area.

Puck: This is home. This is where I want to live. I'd like to encourage my children to stay here and provide an opportunity for them. If I'm going to have a community that's interesting to them, it's going to have to be something more than a John Deere implement dealership. The community is part of where they live, and that means having resources and services available to do whatever else. It's just part of a bigger picture.
Manning:Farms keep getting bigger to stay competitive in a global economy. Family farmers either have to buy more acreage or moonlight at non-farm jobs to keep their families solvent. In a sense, Manning's modern day nonprofits are a hybrid of the farmer cooperatives that sprouted during the 19th century. Neighbors banded together to buy seed or sell their crops. The co-ops worked on the same nonprofit principle: to solve a pressing problem, competitors set aside their immediate interests for the common good. Implement dealer Warren Puck says today Manning can't rely on politicians or the free market to ensure town's future. Nonprofits are a kind of neutral solution.

I think one of the problems with our political process is that we get so polarized and some of what we are trying to do — being liberal, conservative, republican, democrat - here with a nonprofit those same people can come together, keep that stuff out of the way, lets just focus in on doing what we want to do. In this case, it's promote an area or accomplish a certain objective. Maybe nonprofits is the new — I won't say political party — it's the new means of accomplishing things that need to be done.

The modern-day nonprofit has a huge advantage over the old farm cooperatives, though: money. A nonprofit corporation can apply for government and foundation grants. Individuals can contribute, too, and get a tax break at the same time. Manning's local hospital, for example, owned by the town's churches, recently raised $1 million from just 1500 residents.

What's remarkable is how much nonprofits have accomplished in Manning. Indeed, nonprofits do much more than make people feel good. If they become the ties that bind a community together, then nonprofits are a critical ingredient that makes a capitalist economy work.