UN SDG #1 No Poverty UN SDG #1
UN SDG #8 Decent Work and Economic Growth UN SDG #8

challenge

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Private Capital to Build Resilient Food Economies in Native Nations

574 Native Nations served by the Intertribal Agriculture Council (IAC) possess an abundance of cultural and intellectual assets supported by immense land bases replete with natural resources, yet many Tribes experience high rates of unemployment and poverty. Mniwozan Mission Investing Guarantee Pool - MMIGP, will generate locally-controlled private capital to build resilient local food economies.

challenge

5 shares

Private Capital to Build Resilient Food Economies in Native Nations

574 Native Nations served by the Intertribal Agriculture Council (IAC) possess an abundance of cultural and intellectual assets supported by immense land bases replete with natural resources, yet many Tribes experience high rates of unemployment and poverty. Mniwozan Mission Investing Guarantee Pool - MMIGP, will generate locally-controlled private capital to build resilient local food economies.
5M
people impacted
$281.6B
potential funding
the problem
Nature and Context

While the 574 Native Nations served by the Intertribal Agriculture Council (IAC) possess an abundance of cultural and intellectual assets supported by immense land bases replete with natural resources, many Tribes experience high rates of unemployment and poverty. The question of how to permanently lift Native Nations out of poverty has perplexed philanthropists, academics, and policy makers for decades. Many solutions proposed thus far have brought about unintended consequences such as dependency on programs and boom-and-bust cycles that damage ecosystems and turn bustling job markets into ghost towns. The number one reason for enduring poverty in Native communities is the absolute dearth of locally-controlled private capital. Native lands and economies are also rife with outsider-opportunists with some examples being those that divert water off-reservation for non-Native water users, gas and oil companies that seek to exploit unprotected lands, foreign nationals who purchase land to establish illicit crops, large companies that bid on cyberinfrastructure contracts and fail to deliver, and businesses that sell toxic substances to vulnerable people.

Symptoms and Causes

During Colonial Settlement, the U.S. federal government forcibly relocated Native Americans to reservation lands which permanently disrupted their lifeways, including their way of producing food. Since that time, like many others, Native American farmers and ranchers have been subject to poorly conceived federal loan programs that perpetuate financial distress and encourage the production of low-quality, low-nutrient commodity foods. Federal loan programs designed to support producers have been wrought with bias and exclusion, partially due to enduring negative perceptions of Native American people. Private funders lend through predatory terms while charitable funders offer insufficient funding or parameters that are misaligned to the actual need. 

Current programmatic design at all levels; governmental, educational, philanthropic, as well as systems supported by the ag industry, have service providers and producers alike struggling to exist in an ecosystem of scarcity. Because of this we find ourselves caught in a state of triage, either handling acute needs for producers or trying to fund identified needs from insufficient sources. Overcoming these final critical obstacles will begin to unravel centuries of federal policy that has stifled agricultural production and economic development in Indian Country.

Governmental and non-governmental programmatic designs fail to account for existing plans and leadership in communities and are destined to fail under an already overburdened Tribal administrative and political structure. Private lending has proven equally problematic with what are often predatory terms that leave borrowers off worse than when they started. “Charitable giving” often fails to consider the real needs of organizations and those they serve and worse, reinforces a negative, paternalistic cultural narrative that positions Native communities as perpetually needy recipients. In institutions of higher education, a large portion of programmatic and research dollars aimed at Native communities is often extracted from the system through administrative or indirect costs at the expense of the  true purpose of the ‘funded project’.

When the funding paradigm finally shifts and implementation of our funding model allows Native people to exercise control over the cultural narrative lasting change will be possible. For this to happen, funders and investors must be willing to reconsider the way they support Native communities by allowing for more flexible terms and by granting authority over funding, decision-making, and leadership of projects and initiatives considering Native people are best suited to drive the plans and command the resources that will transform their communities. To catalyze this shift and end a century and a half of forced dependency and control, Native voices and creativity will be required to showcase Native American agricultural communities as promising investments that generate major social and environmental returns and create fertile spaces in which to rebuild regional food resilience. 

the impact
Negative Effects

IAC’s work over three decades throughout Indian Country has identified two major challenges to building thriving communities, which our innovative approach seeks to overcome: (1) an extractive system of agriculture finance and (2) an unsustainable ecosystem of community-serving organizations forced to co-opt their mission in exchange for funding. As a result, Native American people have experienced life for over a century characterized by under-resourced and impoverished economies with community members suffering from associated chronic health conditions such as heart disease, diabetes, and psychological distress. In spite of this profound disruption, Native American producers persisted and have maintained agricultural productivity using innovative, conservation-minded methods. To solve the problem of equitable finance of Indian agriculture is to empower those who know the land and its capabilities, are able to possess and control the resources required to develop their own economies, make their own decisions about how food is produced, reduce dependency on federal and private programs, and bring an end to the symptoms of economic and cultural disruption.

Economic Impact

While we have yet to fully quantify the full effects of underbanked and under financed communities, we do know that Native American agribusiness exist in some of the most impoverished conditions in the nation. The 1980’s farm crisis laid bare the dire circumstances facing Native American producers: predatory lenders, bias and disparity in federal programming, lack of capital and infrastructure, shuttered farms and ranches, and communities without adequate food supplies. Spurred on by the call of fellow producers to act, a collective of prominent Native American farmers and ranchers to form the National Indian Agriculture Working Group in 1987.

The Working Group participated in Congressional hearings and reviewed federal agriculture programs for Indian inclusion, subsequently producing the landmark report, Final Findings and Recommendations of the National Indian Agricultural Working Group (the Report). Major findings from the Report revealed agriculture as the most promising revenue-generating industry on Indian lands but also reflected the dismal state of federal programs responsible for serving reservations. Outdated, mismanaged programs were missing key economic opportunities and a decline in the use of lands for agricultural purposes combined to increase dependency on federal food programs. While Native Americans are ensured under federal laws and policies, the right to exercise sovereignty over their own jurisdictions, the exercise of self-determination and self-governance interventions were lagging in agriculture, which held and still holds the most promise for secure food access and sustainable rural economies.

The Intertribal Agriculture Council (IAC) was established to reverse these trends as a national, Native-led organization that would pursue and promote the conservation, development, and use of agricultural resources for the betterment of Native people. At the time of founding IAC, Native American farmers and ranchers were historically undercounted in the U.S. Census and USDA Agriculture Census. The IAC and other national partners advocated for many years for proper accounting of Native-owned and managed farm and ranch operations given the importance of this data for informing federal programming and funding.

In 2008, after years of pressure from the IAC that the US Ag Census properly account for all the reservations in the U.S, improvement became evident. Previous to this, only about 15% of Native producers were accounted for which was a cause for great concern since national agriculture program delivery is tied to this data. Native American producers make up nearly 15% of the producers in the U.S. and participate in diverse forms of production in all regions, climate zones, soil types, and economic climates. Native American producers work in some of the harshest and most complex social, economic, and legal environments in the country and continue to defy expectations and exhibit remarkable resilience.

When the IAC was formed in 1984, agricultural products grown on Indian lands were valued at $548 million through 33,572 Native-owned or managed agricultural enterprises. Through IAC’s policy leadership and its actions impacting Farm Bill policy interventions, Native operations have grown to nearly 80,000 and annual revenues have increased to $3.5 billion as of 2017. Agriculture is now the primary industry on reservation lands with a total of 59 million acres of diverse cropland and lands for used for livestock production.

Success Metrics

Our approach supports programmatic interventions that lead to increases in systemic health and resilience in terms of producer economics, sustainability of lands managed, and the ecosystem of service providers having the means to carry out their missions. To ascertain economic and well-being impacts for producers who participate in our programs and the sustainability finance concept, we will continue to collect qualitative “success stories” that describe the benefits of participating in the program and effects on their quality of life. IAC publishes success stories on an annual basis and creates multi-media pieces for wider distribution. To evaluate quantitative aspects of the program, IAC invested in the design of a custom system to track activities and outcomes from the point of intake to many years later to evaluate programmatic activities and their positive impacts on community-level indicators such as increased access to domestic and foreign markets, adoption of conservation land management methods, and economic indicators such as positions and degrees attained as a result of internships, new jobs added to the agriculture sector, and increases in income levels.

For our more recent work in cultivating agripreneurs, an important aspect of replicability lies in an evaluation process that seeks to answer questions such as: 1) Did an increase in agribusinesses positively impact economic momentum indexes in Native communities (i.e. personal income and employment growth)? 2) Were other indicators of community health and economic wellness impacted? 3) Did our solution encourage cultural revitalization and/or preservation? The evaluation report will be co-published with partners at major research institutions to demonstrate an innovative model for supporting Native communities.

who benefits from solving this problem
Organization Types

Indian Country has the potential to fund its own capacity development with mission-based investments and deployment of patient capital (with “patient capital” defined as flexible finance and loan terms that fit the producer’s schedule). By putting more money each year in the pockets of ag producers and agribusiness owners, we are enabling sustainable practices, and generating a return on investment. The theory as applied emerges from the holistic management body of knowledge and by virtue of the IAC's holistic (read, Native American, or Indigenous) approach to resource development, economic strategy, and sustainability; our definition of 'healthy food' includes the maximum, sustainable, economic benefit to the communities of origin.  

We consider the funding environment for Native agriculture and those organizations that support Native agriculture to be, borrowed from holistic management concepts, a brittle vs. resilient system wherein its regenerative, oceanic-like funding potential is constantly challenged and constrained (‘salinated’) by funder perimeters. In our working metaphor, we would ‘desalinate’ (open access, acculturate) this funding to create a bountiful and resilient system in total - for ecosystems, economic systems, and human communities. As long as any part of this economic-human-ecological system is constrained by powers outside our control, we remain dependent, in a brittle and fragile state, and constantly starting over with each ‘funded project.’

Stakeholders

As a national organization with more than 700 partners in the private, federal, state, and nonprofit sectors, IAC is ideally suited for carrying out this solution. IAC’s reach includes working directly with 574 member Tribes and major federal, state, and private organizations to address major agricultural and economic development.

financial insights
Current Funding

The Intertribal Agriculture Council is an established non-profit organization that has served Indian Country consistently for nearly 30 years. The average annual operating budget is $5,000,000 but has increased to $10,000,000 in the last fiscal year. Recently, IAC was funded for two major initiatives, the first of these being the creation of a nationwide Community Development Financial Institution, and the second, the expansion of organizational capacity through staffing, development, programmatic efforts, and establishing an endowment. IAC's major funders are the U.S. Department of Agriculture, the National Science Foundation, and a number of private funders.

Funding provided by the Native American Agriculture Fund built the foundation of a domestic foods program, the Native Food Connection, that supports agripreneurs on the frontlines of food production to provide Native consumers with access to culturally relevant food supplies. Increased funder interest in this concept inspired us to refine the process of developing successful agribusiness leaders, and we are formally testing, scaling, and evaluating in order to replicate more broadly. The next phase of growth will entail selecting additional agripreneurs at a readiness stage to participate, followed by investments of time, expertise, and financial resources in each agribusiness sufficient to ensure significant increases in profitability and sustained market presence.

Potential Solution Funding

In June and July 2019 all levels of staff participated in strategic development planning through in-person sessions to determine how IAC may align its existing activities and programs with newly expanded mission areas. These new mission areas include legal and policy work, producer and youth professional development, conservation and preservation of Native lands, food systems improvement, IAC’s role as a national hub for networking and information and elevating the economic profiles of Native agriculture communities. Based on these planning sessions, a comprehensive development plan was drafted and circulated for further input and review.

The development plan is designed to support internal capacity building and a targeted development initiative that would allow IAC to access diverse funding sources (federal, private, corporate) that will ultimately build long-term organizational capacity and mission independence. In the last two years, IAC teams have submitted over 25 separate proposals totaling $12.7 million in awarded funds and more than $3 million in pending funds. The leadership team has initiated new partnerships with private and charitable entities interested in mission-based investments.

ideas
Ideas Description

By analyzing the Comprehensive Economic Development Strategies (CEDS) (or their equivalent) of every single Native Nation, as well as feedback from IAC COVID surveys, we discover a truth we have long known, that Native people view food and agriculture as the nexus where health, economy, ecology, and culture all meaningfully come together to create unprecedented opportunity. The advent of COVID-19 and its dire effects in Native communities, especially on food systems, has pushed this work to the forefront of Tribal priorities. Over the last 30 years, the IAC established responsive programming such as the American Indian Foods program (AIF) and the Natural Resources program that positions communities to leverage large land bases and natural resources in order to create sustainable food economies. Over the last year, the IAC team and partners further developed a process that catalyzes economic ecosystems in these regions by graduating food and agriculture producers (‘agripreneurs’) into value-added food production and previously unexplored markets, thereby attracting capital into rural and Tribal regions.

This highly effective idea is gaining national attention as evidenced by recent articles in Forbes, 'Meet The Native American Entrepreneur Who Owns Her Own Kombucha Brand,' and Modern Women, “Three Indigenous Female Entrepreneurs Who are Making Waves in North America”. Native-owned businesses participating in IAC’s American Indian Foods Programs are guided through a process that offers a venue by which they may feature their products, ensures market readiness, and facilitates access to domestic and foreign markets which brings private capital in from outside sources. Directors of the program recently formalized new additions to the process that include partners to work with agripreneurs to establish an e-commerce presence given the turn in consumer behavior towards online purchases. The team considers new product development, equipment and facilities assessments, product inspection for regulatory compliance, selection of aesthetically interesting packaging and labeling, and supply chain and workforce development. 

Funding provided by the Native American Agriculture Fund built the foundation of a domestic foods program, the Native Food Connection, that supports agripreneurs on the frontlines of food production to provide Native consumers with access to culturally relevant food supplies. Increased funder interest in this concept inspired us to refine the process of developing successful agribusiness leaders, and we are formally testing, scaling, and evaluating in order to replicate more broadly. The next phase of growth will entail selecting additional agripreneurs at a readiness stage to participate, followed by investments of time, expertise, and financial resources in each agribusiness sufficient to ensure significant increases in profitability and sustained market presence. 

To accomplish this, IAC is leveraging its extensive partnership network, in particular, the Montana Manufacturing Extension Network (MMEC), a sub-office of the National Institute of Standards and Technology’s Manufacturing Extension Partnership (NIST-MEP) and Barn2Door, an online solutions provider that enables agribusinesses to meet buyers across every channel—web, mobile, social and email. The Montana Manufacturing Extension Center (MMEC). MMEC is housed at Montana State University and has been assisting Montana’s manufacturers since 1996. There is a Manufacturing Extension Partnership in every state. These centers comprise a national network of approximately 1400 hands-on manufacturing consultants that work with medium, small, and start-up manufacturers. Barn2Door is the largest vertical software solution provider exclusively dedicated to helping food and ag producers sell and market their products directly to customers for local delivery, pickup, or shipping. Barn2Door has a strong interest in supporting IAC in order to catalyze the growth of food economies within Native Nations and has established a sponsorship fund to support new agripreneurs who wish to utilize Barn2Door's services. 

Other IAC solutions are fundamental to this concept such as the launch of a Native CDFI, Akiptan, field-building with other Native CDFI's, policy advocacy work through the Native Farm Bill Coalition, and the creation of a Mission Investors' Guarantee Pool focused expressly on food and agriculture. Understanding both the dire need in our Tribal agriculture and food system economies, and the challenges faced by those within the philanthropic sector wishing to merge their intrinsic desire to do good with their understanding of where or how to help, the Intertribal Agriculture Council (IAC), along with other national partner organizations, created an initiative to bridge that gap. This solution offers options for those in the world of philanthropy, as well as other institutional investors to realize the rewards of fostering the resiliency and innovative nature of over 80,000 Indian Country food and agriculture producers.

In a fundamental system changing manner, and in the spirit of investing in the future, the IAC is creating the MaGaZhu, or Mniwozan, Mission Investing Guarantee Pool (MIGP). Starting with IAC's original allocation of $3,000,000, IAC will cover any loss of corpus incurred by a mission-based investor upon maturity of their investment. Liquidity premiums, a relic of days gone by in the investment world, will again be available thereby allowing institutional investors to redeploy their capital, taking mission or impact investing out of the realm of charitable giving, and repositioning it into the fixed income portion of their portfolio. Two of IAC's federally funded programs, the American Indian Foods program and Natural Resources program, at once support the MIGP through ongoing federal cooperative funding agreements, and will in turn benefit from MIGP by infusing private capital dollars directly in Native-owned food and agriculture businesses and help to fund the adoption of holistic/regenerative agriculture practices. Ultimately, MIGP will help to convert the $3.3 billion in raw food products being sold off Indian Reservations today into an estimated $20 billion industry in sustainably produced, high-value, retail-level food products.

Ideas Value Proposition

This solution comes at a pivotal point in the trajectory of the American economy. In response to the social conditions exposed by COVID, philanthropies, government and many others invested in America’s future are considering how systems-level investments may reverse the failing course of capitalism. Health and wealth disparities are at historic highs, and this is certainly the case for Native Nations. Many innovative thinkers are ‘reimagining capitalism’ in terms of which groups participate in and benefit from capitalism, and by ensuring inclusion of Native food and agriculture entrepreneurs (‘agripreneurs’) in this new wave of capitalism, we become frontrunners in this new way of building thriving communities and ensuring a more pluralistic form of governance. 

In terms of Native American inclusion in Capitalism 2.0, there is potential to develop sustainable economies and resilient regional food systems by converting the $3.3 billion in raw food products being sold by Indian producers today into an estimated $20 billion industry in high-value retail level food products. Based on results thus far, we expect to discover profound innovation and prosperity at the confluence of Native autonomy and creativity and technological, financial, and manufacturing solutions. Beyond the immediacy and myopia of economic distress are communities that will be better equipped to deal with the myriad social threats that are currently depleting their resources and threatening their futures. 

Ideas Sustainability

One of the major strengths of this model is in its longevity, which we plan to perpetuate indefinitely through a return on investment wherein the fund receives an annual return of up to 10% for every dollar invested. IAC's approach to sustainable finance has been successfully deployed in 14 distinct geographies with investments ranging from $1,800 to $100,000. Future investments would allow for IAC and partners to more seamlessly align their expertise to better ensure long-term success and identify geographies (communities) that are at a tipping point in terms of transforming the agricultural economy towards one that is productive and sustainable and recruiting new cohorts of agripreneurs.

Given the cultural consonance of IAC's model compared with other investment options, this concept brings an intrinsic familiarity with Indian Country that demonstrates that the only real barriers are based on misconceptions and biases that start an ag-finance relationship off on the wrong foot. Our diverse and varied Technical Assistance network will allow us to stretch our concept across a broader geographic and production area by capitalizing on mission-based investments instead of reshaping missions to match funder values. To cover expanded geographies, additional staff will be required which will be possible in the future with consistent funding streams. Thus scaling up will entail collective agreement on geographies that are prime for investments, strategic alignment of existing expertise, and targeted deployment across the U.S. with higher funding ceilings.

The non-financial resources identified to successfully carry out this funding model are accounted for in our partnerships. IAC is prospecting, however, the possibility of a permanent IAC Native Agriculture Institute to ensure research and programming capacity is available to Native producers, youth, and other professionals so that they have access to a larger organizational headquarters for the purposes of research, training, and workshops. We plan to pursue this possibility through the M.J. Murdock Foundation and the Kellogg Foundation. We also plan to onboard additional board members with expertise in food and agriculture and other related topics.

While our solution is not expected to resolve a century of economic oppression overnight, the MIGP will propel economic development and creation of stable agriculture economies. The model is designed to generate revenue for future investments in production as well as funding the work of organizations that support producers. Typical lending to “excellent” credit risks typically takes up $23,000 of annual production income for every $100,000 deployed (6%, 5 years). IAC's model keeps $100,000 in the community, focusing instead on the 10% ROI and social impact of that deployment. $10,000 in production income meets capital needs and frees up $13,000/year.

attributions
Data Sources

U.S. Commission on Civil Rights, Broken Promises: Continuing Federal Funding Shortfall for Native Americans, 2018.

USDA Sustainable Agriculture Systems, 2017.

UN Food and Agriculture Organization, “Tracking progress on food and agriculture-related SDG indicators: A report on the indicators under FAO custodianship,” 2019.

Global Economy and Development at Brookings, “The Unprecedented Expansion of the Global Middle Class,” 2017. 

USDA Economic Research Service, “Income Growth in Developing Countries Can Increase U.S. Agricultural Exports,” 2011. 

National Congress of American Indians, Indian Country Budget Request FY14, 2014.

USDA NASS, Ag Census Data, Tribal Agriculture, 2012 and 2017. 

Journal of Food Law and Policy, “Building Indian Country’s Future through Food, Agriculture, Infrastructure, and Economic Development in the 2018 Farm Bill,” Hipp, Duren, Parker, 2018.

Northwest Area Foundation, “NATIVE CDFIs ARE PARTNERS FOR INVESTMENTS WITH IMPACT: Community-Based for Sustainable Long-Term Growth”, Scott, 2018. 

Wall Street Journal, “Farmers in Crisis Turn to High-Interest Loans as Banks Pull Back”, November 2019. 

Barn2Door, Press Release, “FARM INNOVATOR SERIES: FROM CATTLE TO BEEF? HOW TO TRANSITION DIRECT-TO-MARKET”: https://www.barn2door.com/webinars/farm-innovator-series-dx-beef?fbclid=IwAR1un-eQqHMUFbdi1NwrPEGN1H6XxS8ZuHPEeDpbcp_yL5hfJ8h082237jE

 Forbes, 'Meet The Native American Entrepreneur Who Owns Her Own Kombucha Brand,' https://www.forbes.com/sites/kennygould/2020/07/03/meet-the-native-american-entrepreneur-who-owns-her-own-kombucha-brand/?fbclid=IwAR2Z4DZBZ9v7xpcC88ofArs42VkmlhPthP3wGYQDHafqz4wzzGCpOkg3ghk#6ff88c2f2b4c

 Flatt, Jason. “28 Organizations Promoting Indigenous Food Sovereignty.” Foodtank. 2020.

 Gifford, Sally. “The Value of Tribal Agriculture Traditions: A Youth Perspective.” United States Department of Agriculture, Office of Communications. August 14, 2019. 

 Hoffschneider, Kerry. “Intertribal Agriculture Council: The Generosity of Agriculture.” Indianz. May 18, 2020.

 Intertribal Agriculture Council, COVID-19 Surveys. 2020. Stable link: https://www.indianag.org/take-a-survey

 Intertribal Agriculture Council. Food for Families: Helping Youth Feed Communities. August 2020. Stable link: https://www.indianag.org/4h

 KickingWoman, Kolby. “Farmers and Ranchers Look for Help to Weather this Storm.” Indian Country Today. April 21, 2020.

 Krishna, Priya. “How Native Americans are Fighting a Food Crisis.” New York Times. April 13, 2020. 

 Modern Women, “Three Indigenous Female Entrepreneurs Who are Making Waves in North America”: https://modernwoman.co/business/three-indigenous-female-entrepreneurs-making-waves-in-north-america/?fbclid=IwAR2krScWYOK3lu4jONZ-2xs9vZDCJwneONGcpKc0VQSWijJzU9qdgwSUF7g

Contributors to this Page

Intertribal Agricultural Council - indianag.org