POVERTY

Richest 1% of Minnesota families own nearly one third of the wealth, data report says

Christopher Ingraham / Minnesota Reformer — Sat, 01 Feb 2025 12:13:00 GMT

Minnesota's household wealth — mirroring national trends — has become more concentrated over the past six decades, a new database of household wealth.

In 1960, for instance, the bottom 50% of families owned about 10% of the state’s total wealth, while the richest 1% had about 17%, according to data collected by Geowealth US.

But by 2010, the share of wealth owned by the bottom 50% fell by roughly half, while the wealth of the richest 1% more than doubled. Those shares changed little from 2010 to 2020.

The estimates in the database are based the federal Survey of Consumer Finances, which asks respondents about their assets and debts, as well as the Census’ American Community Survey, which measures demographics, income and home ownership.

Behind the numbers

The rise in wealth inequality is driven by many factors, including the loss of high-paying blue collar jobs; the growing concentration of white-collar jobs in coastal metropolitan areas and big advanced economies like the Twin Cities; and changes to the tax code favoring the already-wealthy.

Wealth inequality in the United States is greater than in most other democracies. Racial wealth disparities, driven in part by decades of discriminatory policymaking, are often staggering.

Minnesota’s racial disparities are among the worst in the nation, partly due to the state’s long history of redlining, or denying mortgages and other financial services to non-white people. Those century-old policies reverberate in maps of neighborhood inequality made today.

The richest and poorest Minnesota communities are all concentrated in the Twin Cities metro.

The wealthiest communities in the Twin Cities are roughly 10 times richer than the poorest ones, according to the data.

Median households in parts of the west metro — including Lake Minnetonka, Plymouth and Maple Grove — have a net worth well over $400,000. Those in parts of south Minneapolis and the western part of St. Paul have closer to $40,000.

In the richest areas of the country, like Palo Alto or the New York City suburbs, the typical family is worth well over $1 million. In the poorest communities, which are in New York, Houston and Milwaukee, the typical family has only $18,000 in assets.

“People who grow up in wealthier places can reap benefits that span generations,” Tom Kemeny, one of the database’s compilers, explained in a recent commentary. “As a result of property taxes and philanthropy, wealthier communities have greater resources for schools, health care, transportation and other infrastructure.”

This story was originally published on MinnesotaReformer.com.

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Minnesota projects record high of 9 million food shelf visits in 2024

Mary Murphy — Tue, 17 Dec 2024 12:09:00 GMT

ST. PAUL — On Friday, Dec. 13, about 50 people bundled in thick winter jackets waited in the warm lobby of Keystone, a new food shelf in St. Paul. Outside, others stood in line, braving subzero temperatures.

To the right of the lobby, a “market” displays a variety of groceries — grapefruits have remained mostly untouched. On the left, a wall is adorned with colorful drawings — playful doodles from young children who have spent time waiting in the lobby.

Georgi Nguyen, director of basic needs at Keystone Community Services, a nonprofit primarily specializing in food shelf services since 1939, said this “market” model is intentional.

“We call our food shelf here the food market, with the goal of restoring dignity and respect to folks that come in,” she said. “I mean, all the shelves that we installed into the food market when we moved to this building were intentional to create an environment that looks like a grocery store and feels like a grocery store.”

In October, around 11,000 people used Keystone’s services. While the organization’s food shelf numbers remained consistent in 2024, at about 2,500 households per month, Nguyen said those numbers do not reflect the needs of people they turn away.

Nguyen said some days they reach the food shelf's maximum capacity and cannot help everyone who comes to their door. On Thanksgiving this year, they turned away about 60 people, she said.

Minnesota food shelf visits in 2024 are expected to reach 9 million, 1.5 million more than the state’s record high in 2023, according to early December reports from Food Group Minnesota, a nonprofit and research organization.

Nguyen said 90% of the people they serve are at or below twice the federal poverty threshold. The federal poverty line is $15,060 for a single person and $31,200 for a family of four, according to U.S. Health and Human Services.

Nguyen said it’s not often their patrons are unemployed, but they frequently cite housing costs as spurring their need for Keystone’s services.

“A lot of our shoppers are working folks, and on average, people visit the food shelf three times a year,” she said. “There’s this misconception that people try to game the system or abuse access, but a lot of the times when we see folks that ... just lost their job, they haven’t seen us for a long time and needed to come back.”

Minnesotans made 7.5 million visits to food shelves in 2023, a 36.4% increase from 5.5 million visits in 2022 and a 102% increase from 3.7 million visits in 2021, according to Food Group Minnesota.

As Food Group Minnesota tracks the numbers from 2024, Executive Director Sophia Lenarz-Coy said, they expect a new high of 9 million food shelf visits. She said that while this is not as dramatic of an increase as from 2022 to 2023, a steady uptick in need persists.

“Had we talked to anybody in this sector a few years ago, I don’t even think many people would have thought it was possible for the food shelf system in the state to have almost 9 million visits,” Lenarz-Coy said.

She said it’s hard to say what drove this increase but speculated it’s most likely inflation of grocery prices and post-pandemic cuts to federal programs like the Supplemental Nutrition Assistance Program, or SNAP.

She noted the numbers are rarely driven by unemployment, with Minnesota’s unemployment rate at 3.4% in 2023, ranking 21st in the nation, according to the Minnesota Department of Employment and Economic Development.

Nguyen said that since federal and state-funded COVID-19 benefits ended in February of 2022, Keystone saw a steady increase in new patrons every month.

Food stamp benefits decreased by an average of $82 per month in 2023 for 235,000 Minnesotans enrolled in SNAP, according to the Food Research and Action Center. National food prices increased by 5.8% in 2023 and are now 25% higher than they were pre-pandemic, according to the U.S. Department of Agriculture.

“The positive part that (9 million visits) says is that it is an incredibly adaptable system,” Lenarz-Coy said. “We have well over 300 nonprofits, and all 87 counties in the state, they have really risen to the occasion.”

Six Minnesota counties saw their food shelf visits decrease in 2023 — Nobles, Itasca, Lincoln, Faribault, Cook and Dakota — and 10 counties — Kittson, Benton, Grant, Pipestone, Crow Wing, Carver, Washington, Nicollet, Watonwan and Steele — saw increases, according to Food Group Minnesota.

The state recently made efforts to combat some of these food insecurity numbers. On Nov. 25, Gov. Tim Walz announced $5 million in new funding for food shelves ahead of the holidays. COVID-19 relief funds provided by the American Rescue Plan Act are being repurposed for the food shelf funding, he said.

Lenarz-Coy also noted the help of Minnesota’s free meals for students. The program marked one year this fall, with an estimate of over 150 million meals served in the first fiscal year between July 1, 2023, and June 30, 2024.

“All Minnesotans deserve to sit around a full table and spend time with loved ones during the holidays,” Walz said in a release announcing the funding. “Minnesotans are generous people who do their part to ensure their neighbors have what they need — and this funding will go a long way to supporting those efforts. I’m grateful for our partnership with organizations working to tackle food insecurity and distribute these funds quickly.”

Lenarz-Coy said, going forward, eyes are on the Farm Bill that expires in 2025 and encapsulates SNAP funding, tariffs under a new administration, improved benefits for seniors, and continued state funding like the allocations made by Walz earlier this month.

“There are real threats right now that there could be cuts to SNAP at the federal level, and again, we just really raise the political awareness that the emergency food system is not in a place to absorb any potential cuts to snap,” Lenarz-Coy said. “It’s really important that we just continue to invest because I think everybody who’s ever had the stress of not knowing how they’re going to feed their family wouldn’t wish that on anybody.”

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ALICE report helps Bemidji United Way identify new ways to assist struggling families

Ashley McKenzie — Tue, 10 Sep 2024 16:21:59 GMT

BEMIDJI — The United Way of Bemidji Area is making strides to bring attention to the growing challenges faced by families in the community who, despite being employed, are struggling to make ends meet.

Known as ALICE households, these families fall just above the poverty line, leaving them vulnerable to financial crises.

A new report, "ALICE in Minnesota: A Study of Financial Hardship," released by United Ways of Minnesota and United For ALICE, reveals that despite wage increases, the number of struggling households in Minnesota has continued to grow.

“Alice is an acronym. It stands for Asset Limited, Income Constrained, Employed. And it is data about people or families that live just above the poverty line and are working and are one emergency away from being in poverty,” said Denae Alamano, executive director of the Bemidji United Way.

Challenges facing ALICE families

The report highlights how wage growth, even at the fastest rate in four decades, has been no match for inflation. From 2021 to 2022, the number of households living paycheck to paycheck in Minnesota increased to 36%, or 834,343 households. This includes 233,779 in poverty and 600,564 ALICE households.

Alamano noted that Minnesota is not the first to adopt the ALICE data.

“I think we're the 31st or 32nd state to get this information for our state," she said. "The reason we found it important is that these are the people we're talking about in every community issue meeting. They're the people who need transportation to work and their cars aren't working, or they want to qualify for day care but they live just above the threshold where they could get help with day care costs."

For many in Bemidji, these challenges are not abstract statistics but day-to-day realities.

According to the report, in 2022 in Beltrami County, 28% of households were ALICE, compared to the state average of 26%, and 14% of Beltrami County households were in poverty, compared to the state average of 10%. This means in Beltrami County, more households are struggling per capita than the state average, with 42% percent below the ALICE threshold.

“It's exciting to get this information because then we can do something about it," Alamano said. "We have the story and the data, and we can make a difference with that information for the families that live in our community.”

With the official report having launched Sept. 10, Alamano is eager for community members to access the findings, noting how surprising it may be to see the cost of just paying bills today, without considering savings or vacations.

The ALICE households span all demographics and ages, highlighting that the financial strain cuts across generations.

“We’re not just talking about younger families. It's across the spectrum for all ages,” Alamano said.

The report says that for a family of four with an infant and a preschooler, the basic costs to live and work in Minnesota, excluding tax credits, rose from $63,444 in 2021 to $77,304 a year later. Compounding the issue in 2022 was the loss of up to $15,000 in federal child tax credits and stimulus payments that this family had access to in 2021.

In 2022, household costs in Beltrami County for a single adult ($25,524) and a family of four ($74,700) were well above the federal poverty level of $13,590 and $27,750 respectively.

"The findings in this one-year period are consistent with a more than decade-long trend: Since the end of the Great Recession, despite some ups and downs, the number of ALICE households in Minnesota has been steadily growing," the report said. "From 2010 to 2022, the total number of households rose by 10%, households in poverty increased by 1% — and the number of ALICE households grew by 33%."

Inflation, stagnant wages and rising costs of living — especially housing — further complicate the picture.

“When I bought a home as a young married couple with just one baby at the time," Alamano shared, reflecting on her own experience, "that house cost $140,000 then. I looked it up on Zillow to see what it costs now and it's $320,000. Yes, salaries have increased, but not at a rate that could ever keep up with inflation.”

Addressing ALICE needs

To address the problem, the United Way is already working on solutions. One initiative, Wheels to Work, helps families repair vehicles needed for transportation to work, school or day care.

“It's exciting to have this data because now we know the county has a couple of car repair programs. So we know their threshold, what an income needs to look like. And now we can fill that gap,” Alamano explained.

The United Way is also collaborating with local entities and looking to the future.

“So the hope is that anyone can use this (data), including our own local nonprofits, too — I know Greater Bemidji is really interested in the data. So is the county, and Bemidji State had lots of stakeholder meetings with different people sharing that this is coming,”

she said.

Through the report, the United Way hopes to guide future support and programs. Initiatives like child care scholarships and housing trusts could offer solutions drawn from other states' experiences.

Alamano said the organization will seek out nonprofits that serve ALICE families, emphasizing a focus on helping these often overlooked yet vital contributors to the local economy.

“We allocate dollars every year to nonprofits in our community," she added. "And we'll be asking if they're serving ALICE families and how they're doing that. We want to put a focus on ALICE with the dollars that we receive here.”

To learn more about the United Way, visit unitedwaybemidji.org, and to view the full ALICE data report, visit unitedforalice.org/state-overview/Minnesota.

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Snapshot in Time: Minnesota during the Great Depression

C.S. Hagen — Fri, 30 Aug 2024 14:55:00 GMT

The sting of the Great Depression in Minnesota began before the dust storms and clouds of grasshoppers arrived throughout the Midwest. Spurred by World War I demand that brought great affluence, farmers took out loans for new labor-saving machinery that a few years later couldn’t pay back.

The gross income of Minnesota farms fell from $438 million in 1918 to $155 million by 1932, and fell even further as drought spread and unemployment rose to 29% statewide and 70% on the Iron Range.

Nearly nine out of 10 businesses operated at a loss at the onset of the Great Depression. By 1934, strikes were organized. Violent clashes occurred in Minneapolis and in the sweltering summer of 1934 police opened fire on strikers wounding 67 picketers, killing two on “Bloody Friday.”

Minnesota suffered from agricultural depressions and lost thousands of farms, but historical photographs preserved within the U.S. Library of Congress paint two different pictures.

In Minnesota, industries related to beets, lumber and potatoes were the focus for government photographers. In the big cities like St. Paul, many migrant workers sought help, sometimes sleeping in parks or on sidewalks because they had no place to go.

It was a time of contradiction, when dairy farmers poured milk into the gutters while children lay suffering from rickets. Hunger marches and riots raged throughout the nation as hogs were slaughtered and dumped to raise pork prices.

Preachers roamed the countryside telling people they suffered because of their sins, and many believed.

Broke, helpless and even homeless, nationwide suicide rates jumped from 17 per 100,000 after Black Thursday hit in 1929 to 21.3 per 100,000 in 1932.

But the Great Depression was also a time of consolidation, an age when farmers bonded together to form militant defense organizations that marshaled behind politicians.

It was a time of modernization and federal relief programs that improved highways, state parks, city services, the arts, rural schools and public utilities, which led to what retired journalist and author Tom Brokaw called “The Greatest Generation” who went on to build modern America.

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Moorhead man who spent 15 years homeless works to end growing problem

C.S. Hagen — Fri, 22 Dec 2023 11:00:00 GMT

MOORHEAD — Jason Urbanczyk doesn’t remember how he spent 15 winter solstices — the longest night of any year — when he was homeless. In those days, staying high was king.

But when the weather turned bitter, he slept where he could, sometimes breaking into a place to get warm, sometimes sleeping inside tube slides on playgrounds to keep the snow away. Woodlawn Park, “with the big water tower,” was one place he stayed during the winter months.

In Michigan, Colorado and Minnesota, police kicked him out of almost every nook and cranny he could find to sleep.

“I spent 15 years of my life being homeless,” said Urbanczyk, 42. He's been sober for five years and works with the Minnesota Coalition for the Homeless as well as other area boards fighting to end homelessness.

“I was constantly bouncing off of couches, staying with friends, sleeping on the streets. Drugs had such a hold on me that nothing in my life mattered at all,” Urbanczyk said.

On Homeless Memorial Day, which falls on winter solstice, Dec. 21, Urbanczyk said where he spent the night when he was homeless was never as important as his drugs, an addiction that began after he became hooked on opioid-based pain killers prescribed for high school sporting injuries. His life entered a downward spiral when his father, a Detroit police officer, kicked him out of the house for lying.

“There was nothing I wouldn’t do, nothing I wouldn’t turn,” Urbanczyk said. “During the darkest part, I did a lot of financial crimes, created fake bank accounts and large amounts of money coming in from that. It got crazy, the schemes that we were pulling. Sleeping with women, men can prostitute just as much as women can."

Living a nomadic lifestyle, from Colorado to Michigan to Minnesota, Urbanczyk also dealt drugs to survive and get high.

After losing all his friends to overdoses and other accidents, a helping hand at the Lotus Center Inc. in Moorhead about five years ago prevented him from meeting from a similar fate.

“I wandered into the Lotus Center, and it was just getting ready to open, and I started talking to a woman, and they helped me with services for eight months for free. That right there was the big turning point — someone showed me that they cared about me and met me at my level,” Urbanczyk said.

He’s put distance between himself and those he once considered friends on the streets and is focused on working with state legislators, now in Minnesota and next year in North Dakota, on issues like affordable housing and helping those who are homeless.

For the first time in his adult life, he found stable housing with help from a Churches United housing program.

“That was one of the biggest things that saved my life. They helped get me into an apartment. I never had my own place before. This is the longest I’ve ever had a place,” Urbanczyk said.

One issue many homeless people face in finding a place to live is a landlord willing to rent, he said.

Under the Landlord Risk Mitigation program, which is run by the FM Coalition to End Homelessness, Urbanczyk was able to obtain a $3,000 insurance policy and a cosigner, he said.

“Life isn’t pretty out on the streets, and my story is really tame. There are folks out there who are fighting to get off the streets, and they can’t," he said. "We need to focus on homelessness in our state and in our country. We’re not looking at homelessness as a problem, and I don’t get that. Why do people not care?

“Having a home has made my life so much better,” he said.

Urbanczyk considers himself a type of pioneer, one of few people who have lived the life of homelessness and now campaigning to end it, or at least "put a dent in it.”

Having been homeless “100% helps me, and it hinders me. I have a better understanding of what the real need is. If you haven't been out there, you don’t know what they really need. And the system is really slow; they can’t be waiting that long,” Urbanczyk said.

His awareness of how others are struggling keeps him on constant alert.

“It is hard to turn this off. It’s always there for me, when I am out in the car. I’m always looking out, looking at places and thinking if someone is sleeping here or there,” Urbanczyk said.

Those trying to impact homelessness have to work with those who fully understand that experience, he said.

“They just need to start listening to us, and I think they are beginning to now,” Urbanczyk said. "It is really cool being where I am at right now, being homeless just five years ago."

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Poverty simulation gives an inside look at challenges facing Bemidji area residents

Nicole Ronchetti — Wed, 15 Nov 2023 13:00:00 GMT

BEMIDJI — Life in poverty is frequently synonymous with challenges, as families and individuals work to make rent, afford groceries and navigate community services.

But for those who haven’t lived through it, it can be difficult to understand just how difficult surviving on a low income can be.

Increasing that understanding and promoting empathy served as an inspiration for the Bemidji United Way’s recent Poverty Simulation, which was held on Wednesday, Nov. 8, at Bemidji State University’s Beaux Arts Ballroom.

A joint effort between the United Way of Bemidji Area and the Bemidji Area Chamber of Commerce, the simulation invited community members to step into the shoes of someone living in poverty. They became responsible for managing limited budgets, buying groceries, paying rent, finding transportation and everything else necessary to scrape by.

“You have to choose between ‘Do I get my car fixed? Or do I feed myself and my family?’” said Kev Jackson, who works for Paul Bunyan Broadcasting and participated in the simulation. “Having to make those tough decisions isn’t on a lot of people’s radar.”

Throughout the event, participants were given limited resources and time to complete their tasks, and at any point, they could be given a luck-of-the-draw card that could saddle them with an unexpected medical bill or another additional expense.

Several of the participants shared how difficult it was to balance all of these expenses on such a low income.

“No matter how much your rent is, when you don’t have any money it’s a lot to come up with,” explained Aaron Kaiser, who works at American National Bank. “Then to add on groceries, utilities and student loans on top of (rent) made it even more difficult.”

The simulation also required participants to find transportation. While some had vehicles, others had to rely on bus systems to get where they needed to go.

“The sheer volume of places you have to go, people you have to meet, forms you have to fill out (was overwhelming),” Jackson said. “And you didn’t know how you were going to make it happen without losing your home or your heat.”

Even accessing services that were meant to help became a challenge, with limited hours, difficult-to-navigate systems and wait times.

“Timing (was difficult), time for getting to work, getting kids to school, getting to the bank, the wait times,” shared Drew Hildenbrand, Bemidji Middle ��’s principal. “We’d fill out these forms and wait, and hear back ‘You qualify for this, but you have to wait a month.’ Well, I don’t have a month, I need to pay my rent.”

After three hours, the simulation was over, but its impact and the small taste of the stress induced by poverty stuck with the participants.

“You can’t look at a situation (of someone living in poverty) and say ‘They’re just not trying hard enough,’ because that’s just not the case at all,” Jackson said. “I don’t think this experience will fade anytime soon. It was gut-wrenching.”

The fact that participants were able to lay down the mantle of poverty after the simulation, a privilege those living through it aren’t granted, was also not lost on them.

“The really unfortunate part is we’re role-playing. There’s so many families living through this day to day just trying to survive," Hildenbrand said.

Breaking barriers

U.S. census information from 2022 estimated that 24.8% of Bemidji residents live in poverty, over 2.5 times the state average of 9.6%. The current poverty guidelines place the demarcation at two-person households making less than $19,720 annually and four-person households making less than $30,000.

With nearly a quarter of Bemidji’s community members living through this reality, the United Way and the Chamber wanted to raise awareness of the barriers that exist and how the more fortunate in the community can support their neighbors.

“I think we all know there’s poverty in our community, but I think there’s maybe a lot of us who just don’t really know the depth of it,” Jackson shared. “I hope as a community we can think about ways we can make this process easier.”

Whether that’s through increasing the availability of information, improving access to services and transportation, or just meeting people where they are, Kaiser, Jackson and Hildenbrand all agreed that the community can take lessons from this simulation and apply them.

“We’re doing a wonderful job as a community with providing those services, but how can we make them convenient and navigable with a reasonable timeframe?” Hildenbrand asked. “We need to ask ourselves ‘What barriers are we putting up that we don’t mean to?'”

Alongside addressing barriers, Abby Randall, executive director of the Bemidji Chamber, added how she hoped that going through the simulation encouraged participants to approach their employees with a newfound understanding.

“You have to meet people where they’re at. You need to be empathetic as an employer and support removing those barriers,” she said.

On the community scale, Randall encouraged education about the barriers poverty creates and the stress that it puts individuals and families through. She also shared her hope that this simulation will spark genuine conversation and efforts to create better support systems.

“It’s our job as a community to become educated,” Randall left off. “I’m really hopeful that this will send us in a direction where we can keep these conversations going and we can work to make sure everyone has the support they need.”

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