business

Second-quarter results of local banks indicate they are increasing profits thanks to cost-cutting and low- to no-interest payments on deposits.

But the loan portfolios, with exception, still aren't growing much, amid banks trying to rebuild capital and dealing with born-again regulators in the wake of the mortgage-related meltdown.

The biggest losers continue to be small businesses and hard-pressed nonprofits that are having a harder time raising money at a time of increased demand for services.

A little help arrived last month through a $750,000 grant to the Nonprofits Assistance Fund from the U.S. Department of Treasury's Community Development Financial Institutions Fund.

"This is a significant boost to our loan fund, bringing our available capital to nearly $15 million," said Assistance Fund CEO Kate Barr, a 20-year officer of the former Riverside Bank who moved to the nonprofit world a decade ago. "Right now, these organizations are challenged to deliver services while navigating a difficult economic climate and uncertainty about philanthropic dollars and the state budget. This additional capital will allow us to provide financing for ... community-based clinics, charter schools, development of affordable housing units and other innovative services.

"We approved 94 loans in the fiscal year ended in March, totaling $8.6 million, our highest level by far. Banks pulled back for a variety of reasons. Many nonprofits lost money in 2009. While they may have had reserves and assets to allow them to manage the loss, underwriting criteria got tough and the nonprofits had a harder time qualifying."

For example, the Great Minneapolis Crisis Nursery needed cash-flow financing beyond what it could obtain from banks in 2009. The nursery had been trying to sell or lease its former building in south Minneapolis but ran into the frozen commercial real estate market. It leased to a charter school that faced its own cash flow problems because of declining state funding. More families, stressed by job losses and foreclosures, required more services. Donations were down. Nonprofit Assistance helped bridge the short-term gap.

The Treasury awarded $105 million to 179 non-traditional and community lenders from among 408 applicants nationwide.

Meanwhile, the Community Reinvestment Fund USA (CRF), a nonprofit financial intermediary that connects community development lenders with Wall Street, has received a $100,000 grant from the Bank of America Charitable Foundation, the latest in a series of investments by the big bank.

Since 1988, Minneapolis-based CRF has helped drive more than $1.1 billion in private capital to inner cities and small towns, leading to the creation or retention of nearly 45,000 jobs, said CRF Chief Executive Frank Altman.

CRF helps grow businesses that one day can be banked by commercial lenders.

Future jobs exhibit at fair

The Minnesota Department of Employment and Economic Development is showcasing future jobs at an exhibit in the Eco Experience building at the Minnesota State Fair.

This includes:

•MinnesotaWorks.net, through which job seekers can view thousands of job listings from private employers, upload resumes and apply for work.

•The iSeek energy careers website for jobs in renewable energy, utilities, distribution and energy-efficient construction. ISeek is Minnesota's comprehensive career, education and job resource.

•Three "green-oriented" growth companies, including Entropy Solutions, which creates temperature-controlled packaging solutions from vegetable oils for the transportation, construction, healthcare and food industries.

•Pure Soap Flake Co. of Pine River, which manufactures cleaning and washing products that use natural ingredients, including soybean oil.

•Red River Coatings of Argyle, which makes environmentally friendly animal and bird deterrents.

Other partners in the "Jobs for the Future" exhibit include Minnesota State Colleges and Universities, Minnesota Renewable Energy Marketplace, MinnesotaWorks.net and Veterans Employment Services. Showcraft, the BioBusiness Alliance of Minnesota,and the American Society of Landscape Architects also contributed to the exhibit.

The Eco Experience is open from 9 a.m. to 9 p.m. through Labor Day.

Pollution preventer

For more than 15 years, owner Dan Klasen has worked at Clean 'N' Press to make the 30-store dry cleaning business cleaner and greener.

This year, he was awarded the "Minnesota Governor's 2010 Pollution Prevention Award" for demonstrating a superior commitment to pollution prevention and resource conservation. "It is very rewarding to be recognized for the work we are doing every day to deliver quality to our customers, with the highest concern for the environment we can achieve," Klasen said.

Through modified equipment, recycling programs, insulation and using waste heat to preheat water, Klasen estimates he saves about $15,000 annually in utility costs and has cut energy consumption by about 15 percent.

In addition to dry cleaning and finishing services, West St. Paul-based Clean 'N' Press offers "wet" cleaning -- an environmentally oriented alternative to chemical-based dry cleaning.

Neal St. Anthony • 612-673-7144 • nstanthony@startribune.com