1. MW-ZXF585-20060118-310 Close the Gap: A Business Response To our Region’s Growing Disparities Fall 2008

2. MW-ZXF585-20060118-310 1 TODAY’S AGENDA Overview of the Itasca Project Socioeconomic disparities in our region –Findings from Mind the Gap report –Highlights of Close the Gap documentary Itasca’s response

3. MW-ZXF585-20060118-310 2 THE ITASCA PROJECT What is Itasca Who is Itasca An employer-led alliance to drive regional efforts to keep the Twin Cities’ economy and quality of life competitive with other regions 50-plus community leaders Primarily private sector CEOs Includes a handful of public sector leaders, such as the Governor, the Mayors of Minneapolis and St. Paul, Chair of the Met Council, and the leaders of the University of Minnesota and MNSCU

4. MW-ZXF585-20060118-310 3 ITASCA IMPACTS ECONOMIC COMPETITIVENESS AND QUALITY OF LIFE BY FOCUSING ON IMPORTANT ISSUE AREAS Building Financial Fitness Understanding and Addressing Socioeconomic Disparities (Close the Gap) Socioeconomic disparities Creating a World-class K-12 School System in MN Supporting the Strategic Re- direction of Minneapolis Public Schools Improving Early Childhood Development Education Strengthening University- Business Relationships Retaining and Growing Leading Employers Supporting Small Business Building Financial Fitness Business & economic growth Infrastructure & enablers Setting Regional Performance Indicators Advancing a Comprehensive Transportation Plan

5. MW-ZXF585-20060118-310 4 TODAY’S AGENDA Overview of the Itasca Project Socioeconomic disparities in our region –Findings from Mind the Gap report –Highlights of Close the Gap documentary Itasca’s response

6. MW-ZXF585-20060118-310 5 THE ITASCA PROJECT AND SOCIOECONOMIC DISPARITIES Addressing the region’s socioeconomic disparities was one of the first issues the Itasca Project took on when it was founded over five years ago. With support from the McKnight Foundation, Itasca worked with the Brookings Institution Metropolitan Policy Program to better understand the nature and magnitude of our socioeconomic disparities. This report was used to raise awareness of the troubling disparities and to motivate change in our community. In 2008, in an effort to further build awareness, Itasca partnered with Twin Cities Public Television (tpt) to create a documentary to bring the disparities highlighted in Mind the Gap to life.

7. MW-ZXF585-20060118-310 6 DISPARITIES IN OUR REGION ARE GROWING, AND THREATEN OUR ECONOMIC HEALTH In Minnesota, not all children are “above average.” In fact, large populations are struggling In spite of our overall economic strength, there are 3 stark and growing socioeconomic gaps in the Twin Cities – gaps tied to race, class, and place – which threaten to undermine our region’s future Closing these gaps now is not just the right thing to do, but the smart thing to do

8. MW-ZXF585-20060118-310 7 RACE DISPARITIES CUT ACROSS ALL SOCIOECONOMIC INDICATORS. THEY AFFECT ALMOST ALL NONWHITE RACE AND ETHNIC POPULATIONS... Source:Brookings Institution; Wilder Foundation; MN Department of Health Center for Health Statistics RACE Compared to the average white Twin Cities resident The average black Twin Cities resident is: –Earning 48% less –73% less likely to own a home The average Latino Twin Cities resident is: –4 times more likely to be uninsured –5 times more likely to be a teen mother The average Native American Twin Cities resident is: –2.5 times less likely to have access to a car –5.5 times more likely to receive inadequate prenatal care

9. MW-ZXF585-20060118-310 8 NONWHITE MINNESOTANS ARE SIGNIFICANTLY LESS LIKELY TO HAVE INSURANCE Source: MN Health Access Survey (2001, 2004, 2007) RACE 200120042007 American Indian 19%22%16% Asian8%10%6% Black17%14%15% Hispanic24%31%19% White (Non- Hispanic) 5%6% All6%8%7% Uninsured population (ages 0 – 64) Percent

10. MW-ZXF585-20060118-310 9 WITH RAPIDLY GROWING MINORITY POPULATIONS, THESE RACIAL AND ETHNIC DISPARITIES ARE BECOMING MORE PROMINENT Source:Twin Cities Compass RACE Population by race Percent 20071990 Nonwhite White Between 1990 and 2007 the metro added over 350,000 minority residents – a 166% increase 2000

11. MW-ZXF585-20060118-310 10 BEFORE REACHING SCHOOL AGE, LOW-INCOME CHILDREN FALL BEHIND HIGHER-INCOME PEERS Source:MN School Readiness Year 2 study CLASS 8 10 17 55,001-75,000 35,001-55,000 75,001 or more 0-35,000 6 Language and literacy 8 15 6 10 Mathematical thinking Income Dollars Percentage of MN Children rated “not yet” performing adequately at kindergarten entrance, by household income

12. MW-ZXF585-20060118-310 11 THIS DISADVANTAGE CONTINUES THROUGHOUT THE EDUCATIONAL SYSTEM, REGARDLESS OF RACE Source:Metro Trend Watch, Brookings Institution Low income (up to 185% of poverty level) All other students White American Indian Black Asian Hispanic Third-graders proficient in reading, 2001-02 – Minneapolis and St. Paul CLASS

13. MW-ZXF585-20060118-310 12 INCOME, LIKE RACE, IS TIED TO A MULTITUDE OF OTHER SOCIOECONOMIC INDICATORS – FOR EXAMPLE, HEALTH Percent in Poor/Fair Health by Income* Source:Robert Wood Johnson Foundation, February 2008, Overcoming Obstacles to Health: Stories, Facts and Findings, National Health Interview Survey, 2001-2005 CLASS >400% FPL 300 - 399% FPL 200 - 299% FPL 100 - 199% FPL 100% FPL Percent in Poor/Fair Health by Race White, Non-Hispanic Hispanic Black, Non-Hispanic * Defined by relation to Federal Poverty Level (FPL)

14. MW-ZXF585-20060118-310 13 THE CENTRAL CITIES HAVE HIGHER CONCENTRATIONS OF POPULATIONS THAT STRUGGLE WITH RACE AND CLASS DISPARITIES Total population Minneapolis – St. Paul Suburbs Non-white population Poverty population Source:Brookings Institution; Wilder Foundation; HUD State of the Cities database Percent share of population, 2000 PLACE

15. MW-ZXF585-20060118-310 14 POVERTY IS CONCENTRATED IN THE 2 CENTRAL CITIES Source:Brookings Institution Share of persons living in poverty, 2000 PLACE

16. MW-ZXF585-20060118-310 15 FROM AN ECONOMIC COMPETITIVENESS STANDPOINT, WHY SHOULD THE TWIN CITIES REGION WORK TOWARD REDUCING DISPARITIES? Reducing disparities among race and income groups builds a more competitive workforce –In 2011, the baby boomers will start to retire. By 2029, the oldest baby boomers will retire –By 2029, the region will have to replace 776,000 workers – 350,000 of these are highly educated –The achievement gap suggests that, without intervention, the replacement workforce will not match skills of boomers Reducing disparities among race and income has a positive economic impact –Increase the tax base –Reduce poverty expenditures –Put more money in the local economy Reducing disparities among places will make the region stronger and more competitive –Research suggests that fates of large cities and their metropolitan areas are intertwined – they grow together or they decline together

17. MW-ZXF585-20060118-310 16 MINORITIES WILL MAKE UP A MUCH LARGER SHARE OF THE TWIN CITIES’ FUTURE WORKFORCE

18. MW-ZXF585-20060118-310 17 CLOSE THE GAP DOCUMENTARY

19. MW-ZXF585-20060118-310 18 TODAY’S AGENDA Overview of the Itasca Project Socioeconomic disparities in our region –Findings from Mind the Gap report –Highlights of Close the Gap documentary Itasca’s response

20. MW-ZXF585-20060118-310 19 BROOKINGS SUGGESTED 3 KEY STRATEGIES TO REDUCE DISPARITIES Update the basics – Make sure education, healthcare, and public safety meet the needs of the region’s 21st century population Increase income and wealth – Help minority groups close the gap on economic measures (e.g., access to EITC and food stamps, homeownership, financial literacy) Act regionally – Issues are regional and require regional solutions Update the basics – Make sure education, healthcare, and public safety meet the needs of the region’s 21st century population Increase income and wealth – Help minority groups close the gap on economic measures (e.g., access to EITC and food stamps, homeownership, financial literacy) Act regionally – Issues are regional and require regional solutions

21. MW-ZXF585-20060118-310 20 IN RESPONSE, ITASCA LAUNCHED SEVERAL TASK FORCES TO FURTHER ADDRESS DISPARITIES Addressing Socioeconomic Disparities Mary Brainerd (CEO of HealthPartners) and Lynn Casey (President & CEO of Padilla Speer Beardsley) Financially Fit Minnesota Brad Anderson (CEO of Best Buy) Supporting the Strategic Re-direction of Minneapolis Public Schools Bruce Nicholson (President and CEO of Thrivent Financial) Creating a World-Class K-12 Education System in MN Dick Pettingill (President and CEO of Allina Hospitals and Clinics) Twin Cities Compass Irv Weiser (Retired Chairman & CEO of RBC Dain Rauscher) and Kathy Tunheim (President & CEO of Tunheim Partners) 2 2 1 1 3 3 4 4 5 5

22. MW-ZXF585-20060118-310 21 Created a Speakers Bureau to distribute message from Mind the Gap ADDRESSING SOCIOECONOMIC DISPARITIES – AWARENESS BUILDING EFFORTS ActionsResults Speakers Bureau Close the Gap toolkit Close the Gap documentary Included tactical suggestions for employers in areas such as Income and Asset Development, Housing, Early Childhood Education, Educational Attainment, Health Care Presented to over 10,000 people (and counting) Distributed over 6,000 Businesses, churches, city and county departments, and universities incorporated into strategic plans Distributed over 6,000 Businesses, churches, city and county departments, and universities incorporated into strategic plans Partnered with tpt to create a documentary which brings to life the disparities highlighted in Mind the Gap Over 50,000 households have viewed all or part of documentary on air 8,000 visitors to Close the Gap website 1,500 DVD’s distributed Over 50,000 households have viewed all or part of documentary on air 8,000 visitors to Close the Gap website 1,500 DVD’s distributed In addition, Itasca has supported community efforts such as ServeAmerica early literacy program, EITC programs and STEP UP summer jobs 1 1

23. MW-ZXF585-20060118-310 22 FINANCIALLY FIT MINNESOTA Mind the Gap report highlighted disparities in financial well-being and recommended a focus on improving financial literacy Further research revealed that families in Minnesota and throughout the U.S. are increasingly engaging in unsound financial behavior, with particularly dire consequences for low income families In response, The Itasca Project launched Financially Fit Minnesota, which asks companies to commit to increasing participation rates in direct deposit and retirement – and to close the gaps between employee groups Financially Fit Minnesota employers 3M ▪ Allina Hospitals & Clinics ▪ Best Buy ▪ Deluxe Corp. ▪ Fairview Health Services ▪ Federated Insurance ▪ General Mills ▪ HealthPartners ▪ Jefferson Lines ▪ Met Council ▪ Minneapolis/St. Paul Business Journal ▪ Mortenson Construction ▪ Pentair ▪ Regions Hospital ▪ SUPERVALU ▪ Target ▪ Thor Construction ▪ Thrivent Financial for Lutherans ▪ Travelers ▪ University of Minnesota ▪ U.S. Bancorp ▪ Weber Shandwick ▪ Wells Fargo ▪ Xcel Energy Still recruiting more employers! Visit www.FinanciallyFitMN.org or email info@FinanciallyFitMN.org for details www.FinanciallyFitMN.org info@FinanciallyFitMN.org 2 2

24. MW-ZXF585-20060118-310 23 Strategy HOW FINANCIALLY FIT MINNESOTA WORKS Model employer behaviors that set a new community standard Recruit employers to make organizational commit to –Increase direct deposit participation –Increase retirement plan participation Provide tools to help employers set and meet goals – with a focus on closing gaps between employee groups Objective Goal is to impact 50,000 Minnesota families by end of 2009

25. MW-ZXF585-20060118-310 24 SUPPORTING THE STRATEGIC RE-DIRECTION OF MINNEAPOLIS PUBLIC SCHOOLS Minneapolis Public Schools faces significant challenges –District lost 25% of students in six years, causing financial challenges and budget deficits –Falling behind on state testing (75% of individual schools below state average) –Dramatic achievement gaps (e.g, 82% Caucasian proficient in math vs. 34% for African American) Itasca supported the Strategic Planning process for Minneapolis Public Schools 3 3

26. MW-ZXF585-20060118-310 25 CREATING A WORLD-CLASS K-12 EDUCATION SYSTEM IN MN Source:“Minnesota Population Projections 2005-2035”, Minnesota State Demographic Center, June 2007; “Knocking at the College Door,” Western Interstate Commission for Higher Education (WICHE), March 2008 Identify the “best practices” that define world-class K- 12 schools and systems a Benchmark Minnesota’s performance and system practices against US and international systems b Prioritize 3-5 changes to drive Minnesota to world- class “best practices” c The Itasca Project and Minnesota Business Partnership are co-sponsoring an initiative to: Graduation Rates and 10-Year Growth by Ethnicity Percent, 2008-2018 Graduation RateGraduation RateGraduation RateGraduation Rate White Am. IndianAm. IndianAm. IndianAm. Indian AsianBlack His- panicHis- panicHis- panicHis- panic Growth Though historically strong, Minnesota and its education system are facing a number of challenges, including: Increasing global competition, requiring educated workforce to remain competitive Indications that MN students are lagging international counterparts on achievement Significant achievement gaps, with a shifting demographic mix towards student groups who demonstrate lower rates of success in current system (shown below) 4 4

27. MW-ZXF585-20060118-310 26 TWIN CITIES COMPASS: www.tccompass.org Twin Cities Compass promotes our region's well-being by –Measuring progress –Reporting findings –Providing strategies for action Tracks regional indicators across eight key areas Itasca supported development and led the convening of experts to identify key indicators 5 5

28. MW-ZXF585-20060118-310 27 SINCE ITS LAUNCH FIVE YEARS AGO, ITASCA HAS MADE SIGNIFICANT IMPACT ON A WIDE ARRAY OF INITIATIVES Supported efforts to secure dedicated funding for transportation Launched Financially Fit Minnesota – 26 employers working to improve financial fitness of employees Created “front-door” to University of Minnesota, greatly enhancing businesses’ ability to access services and for University technology transfer Launched cultivation program to retain and grow Minnesota’s large employers, an important driver of economic competitiveness Built awareness of socioeconomic disparities by presenting Mind the Gap to over 10,000 community members; in addition, 50,000 households have seen all or part of Close the Gap documentary Supported strategic plan at Minneapolis Public Schools; set path for district reform Played leading role in creation and implementation of Twin Cities Compass Distributed Close the Gap toolkits to 6,000 employers and helped create plans to address socioeconomic disparities Created the GetGoMN.org to link entrepreneurs with funders and support services Helped hundreds of Minneapolis students to access summer jobs through Step Up summer job programs CEO’s drive and lead every task force – spend real time engaging on the issues Relatively small budget, funded by partnership between CEO’s and local Foundations Leverage millions of dollars and thousands of hours in pro-bono services and volunteer efforts from community organizations and businesses

29. MW-ZXF585-20060118-310 28 WHY ITASCA IS EFFECTIVE Find a unique role for Itasca to play. Role varies by initiative, but usually fills a leadership gap in region 3 3 Driven by passion. Each initiative driven by a CEO – based on their passions 1 1 Lead with the facts. Willing to invest time and money required to get the best common fact base 2 2 Collaborate and partner. Work with those organizations who can help get things done 4 4

30. MW-ZXF585-20060118-310 29 COMPANY SPECIFIC EXAMPLE - HEALTHPARTNERS. REDUCE IDENTIFIED HEALTH DISPARITIES. INCREASE DIVERSITY. FINANCIAL FITNESS “ PACESETTER”. “MIND THE GAP” COMMUNITY ENGAGEMENT

31. MW-ZXF585-20060118-310 30 OPTIMAL DIABETES CARE BY RACE AT HEALTHPARTNERS

32. MW-ZXF585-20060118-310 31 % PATIENTS UP-TO-DATE WITH PREVENTIVE SERVICES HEALTHPARTNERS, 3 RD QUARTER 2007

33. MW-ZXF585-20060118-310 32 PREVENTIVE SERVICES BY RACE MESSAGES HEALTHPARTNERS 2007

34. MW-ZXF585-20060118-310 33 WHAT CAN PUBLIC HEALTH LEADERS DO TO ADDRESS SOCIOECONOMIC DISPARITIES? Look critically at your organization. Conduct an internal assessment and explore how your can incorporate strategies to close the gap into your organizations –Use Close the Gap toolkit for ideas available at: www.unitedwaytwincities.org/CommunityInfo/closethegap.cfm www.unitedwaytwincities.org/CommunityInfo/closethegap.cfm Join Financially Fit Minnesota. Help your employees be more financially secure and prepared for the future –Visit: www.FinanciallyFitMN.orgwww.FinanciallyFitMN.org –Email: info@FinanciallyFitMN.org Raise awareness and catalyze action. To motivate change, broad awareness and understanding of these issues is required. Use the tpt Close the Gap documentary and the Human Resources Diversity Council discussion guide (coming soon!) to host a discussion at your organization. –Watch for more at: www.tccompass.org/disparities

35. MW-ZXF585-20060118-310 34 We all have a role to play in addressing socioeconomic disparities Resources: Twin Cities Compass: www.tccompass.orgwww.tccompass.org Close the Gap documentary and tools: www.tccompass.org/disparitieswww.tccompass.org/disparities Mind the Gap report and Close the Gap toolkit: www.unitedwaytwincities.org/CommunityInfo/closethegap.cfm www.unitedwaytwincities.org/CommunityInfo/closethegap.cfm Financially Fit Minnesota: www.FinanciallyFitMN.orgwww.FinanciallyFitMN.org For more info on The Itasca Project and initiatives: Contact allison_barmann@mckinsey.comallison_barmann@mckinsey.com