Welcomed in Worthington: Immigrant success stories abound in community
By Jackie Hilgert, Independent Community Bankers of Minnesota
Editor’s note: The following article was published in the Independent Community Bankers of Minnesota’s magazine for its members.
WORTHINGTON — Maria Parga always wanted to own her own business.
Before she came to Minnesota to be near family, Parga had been selling food out of her house in Guadalajara, Mexico. After Parga immigrated to Worthington and had saved enough from her job at the local pork processing plant, she bought a small storefront from which she sold clothes, jewelry, videos and CDs. Sales from her first week totaled roughly $30. Over time, Parga added inventory to her market, including fresh tortillas, which put her in violation of licensing requirements — one of myriad first-world barriers to business success immigrant entrepreneurs must overcome.
Beyond raising capital, learning American business norms is a huge challenge facing immigrant entrepreneurs, said Greg Raymo, president of First State Bank Southwest in Worthington, who provided Parga with part of the financing she needed to acquire and renovate the town’s shuttered American Legion in order to open Mini Market Lupita in 2010.
“You need a community partner who can provide teaching tools,” Raymo said. “It’s our job to make sure we have all the right people at the table to help [immigrants] succeed.”
The right people in Worthington includes interpreters, business counselors and the Southwest Initiative Foundation, a nonprofit that serves 18 Minnesota counties and two tribal nations, and provides financing and other business development services to start-ups. The SWIF is a resource for critical pre- and post-business technical assistance: providing immigrant entrepreneurs access to instruction in bookkeeping, marketing, website basics, or complying with state or local licensing requirements. It also provides subordinate financing through a micro-enterprise loan program.
Through the SWIF, Parga received business management guidance and made connections to other community resources such as SCORE and the Worthington Chamber of Commerce; she also received a micro-loan to fund an expansion.
Yet Raymo provided Parga with something equally valuable: “He listened to me and encouraged me to expand,” she said.Community banker as conduit
“Entrepreneurship is critically important to us,” Raymo said of his $250 million bank, which operates six locations throughout the rural southwest corner of the state. The qualities people often attribute to entrepreneurs — adaptability, willingness to work hard, risk-taking — are characteristics Raymo says he sees in Worthington’s growing immigrant population. Those immigrants have been, since the early 1990s, transforming his town and many now are his commercial loan customers.
Juan Palma moved to Worthington from Baja California, Mexico, in 1999. In 2006 he borrowed money from his family and maxed his credit cards to rent space for a fledgling auto repair business.
“It was difficult for us to meet the requirements of the bank,” Palma said. Despite Palma’s early challenges, Raymo listened, and did what he could: he connected people to programs.
The micro-lending program exists for fledgling businesses, said Amy Woitalewicz, the SWIF’s business finance director. The foundation, which received its funding from the McKnight Foundation during the farm crisis of the 1980s, deploys SBA or USDA rural development dollars or grant funds, and prices its loans according to risk and credit score.
“New Americans,” Woitalewicz said, “have a greater challenge navigating through permitting processes or the tax system.”
Building credit with a bank was a foreign concept to Du Nguyen and Khanh Le, owners of a Worthington nail salon called ProfessioNail. Nguyen and Le immigrated from Vietnam in 1991 and moved to Worthington in 2000. They said paying bills by check was not an accepted practice in Vietnam.
“You were required to pay cash or use a credit card,” Nguyen said.
“They are so used to dealing in cash,” Raymo said. “They come from a country where banks aren’t trusted.”
Family is far more trusting, and more than willing to help one another become successful, Raymo said of the immigrant community.
“It’s common for them to pool their money to help their friend have enough capital to start a business,” he said. “I have admired that trustworthiness so much.”Immigration as X-factor
There’s no shortage of diversity in Worthington. At JBS, the pork processing plant where many newcomers to Worthington first find work, there are roughly 60 languages spoken among its more than 2,200 workers. The 2010 U.S. Census, which reported Worthington’s population at nearly 13,000 people, lists the town’s racial profile: 62 percent white, 35 percent Latino, nearly 9 percent Asian, 5.5 percent African American, less than 1 percent Native American, and more than 20 percent “other.”
Notably, the town reversed a decades-long decline beginning in the 1990s and has been growing ever since while rural towns across the country have faced aging citizenries and declines in the sort of economic opportunities that encourage young people to stay. Immigration as the X-factor for economic growth in an era of declining birth rates recently caught the attention of Neel Kashkari, president of the Federal Reserve Bank of Minneapolis, who has argued that the United States cannot achieve optimal growth without increasing its workforce. Kashkari was a guest at a town-hall meeting in Worthington last summer, where he listened to civic leaders talk about the changing face of their community.
At the meeting, Raymo recounted how he had once closed an entire SBA loan for an immigrant family by relying on their 12-year-old daughter to translate.
“It was eye-opening,” Raymo said. “They started with nothing and have expanded into their own facility now.”
Kashkari, in an op-ed published in the Wall Street Journal last January, said immigrant inflows to the United States are low as compared to the early 20th century. Data from the Minnesota State Demographer supports his assertion. In 1920, roughly one in five Minnesotans was foreign born compared to one in 12 in 2016. Nearly half of all foreign-born Minnesotans are naturalized citizens. Legal status is required for business owners to qualify for financing.
Kashkari’s visit coincided with Worthington’s annual International Festival, which gives the community an opportunity to celebrate its diverse culture, which contributes to the town’s vitality. You can see this diversity on display in the business district each day, where a majority of the enterprises are owned by immigrants, a marked change from a few decades back.
The investments these newest residents are willing to make in bettering their community mirror the support the community provided when the town first embraced newcomers.
“Like us, immigrants tend to want to own a home as soon as they can,” Raymo said, adding it’s homeownership and its impact to the tax base that supports any additional services new residents need, such as interpreters and ESL teachers in the schools.
“Right now, the immigrant population is by far the biggest consumer of housing in Worthington,” Raymo said. This demand for housing helped First State Bank Southwest weather the economic downturn in 2008-2010, Raymo said.
The transformation of Worthington has not occurred without its detractors. An early reflex of the community was turf protection, with some murmuring about how Worthington isn’t what it used to be.
“I’ve been here 21 years and I still hear it,” said Raymo, who’s quick to respond, “we can be fortunate that it’s not, because we continue to grow and that growth is being fueled by immigration.”
Growth is what excites Raymo about immigration and why he promotes it as the “next opportunity for us as rural communities to revitalize rural America.” And he doesn’t have to look much beyond his own bank for evidence. In his lobby, immigrants wait to fill out home mortgage applications. Down the street, residents enjoy lunch at Lupita Mexican Restaurant, the second enterprise in town now owned by Maria Parga. Her restaurant combined with the expanded Mini Market Lupita now employs eight.
Palma Customs and Auto Sales now employs 10 and is expanding from two service bays in an old garage to a new 6,000-square-foot dealership with six service bays and a new surface lot where anyone can kick some tires.
“I really want to create additional credibility in the marketplace that will allow me to diversify my customer base,” Juan Palma said.
And ProfessioNails now has a new building on a prime location on Worthington’s main drag. It includes two store frontages, one for Nguyen and the other for a tenant or for future expansion.
“The decision to start our business was our dream,” Nguyen said.