Low-cost loan will enhance Northland’s capacity for mission-driven work in northeastern Minnesota
The Northland Foundation has received approval of a $5 million, 10-year program related investment (PRI) from The McKnight Foundation.
“(This PRI) is a game-changer in our ability to serve northeastern Minnesota now and for years to come.”
—Tom RenierAn alternative to a traditional grant, a PRI is a low-cost loan provided at below-market rates to strategically strengthen the charitable work of the recipient. The use of PRIs was pioneered by the Ford Foundation starting in 1968 and is beginning to regain popularity among some larger foundations nationally. Upon repayment, PRI lenders may reinvest the same dollars in other mission-relevant work in the future.
The McKnight Foundation established the Northland Foundation and the five other Minnesota Initiative Foundations in 1986. McKnight has continued to support Northland’s work since then with more than $51 million in grants—and now a PRI—to better serve the needs of people and communities in northeastern Minnesota.
“For 25 years, The McKnight Foundation has benefited from an effective partnership with the Northland Foundation to serve the people of northeastern Minnesota,” stated Neal Cuthbert, vice president of program at McKnight.
“The real power in this new PRI is knowing that our investment — in the hands of Northland — will pay for itself many times over, on behalf of the people and the communities in that region of the state,” continued Cuthbert.
The PRI to the Northland Foundation will directly and immediately enhance the Business Finance Program, which provides gap lending to stimulate job creation and community vitality. Also benefitting in the near term is the Assisted Living initiative, which provides affordable housing and care for older adults, as well as dozens of jobs in McGregor, Buhl, and Hoyt Lakes, Minnesota. This latest investment by the McKnight Foundation will have lasting impact in Northland’s overall philanthropic capacity.
“A PRI of this magnitude gives us flexibility at a time when funding is harder to come by. More importantly, it will enable us to transform facets of our organization and financial structure and lift the Northland Foundation to a new level of strength and stability,” said Tom Renier, Northland Foundation President.