On March 25, staff, program leaders and community members led a panel discussion with about 80 attendees on the future of East Side Neighborhood Services. The nonprofit organization, located in Northeast Minneapolis, operates a range of community assistance programs. The next meeting will be held on Wednesday, April 8, at 4 p.m. at ESNS. (Al Zdon)
The future of the East Side Neighborhood Services (ESNS) took another turn with a meeting called by the employees of the nonprofit organization on March 25.
The employees of the financially troubled community service organization were most concerned about the ESNS Board’s plan to merge with another organization and possibly sell the organization’s building at 1700 Second Street.
The workers said their first goal is to pause the negotiations the board is now conducting with other organizations for 60 days.
About 80 people attended the meeting at the ESNS building. The general tenor of the audience was that they would like to help save the organization and its programs.
Talia Smigielski, a creative arts therapist at East Side, told the group, “We’re interested in getting the community activated around saving East Side Neighborhood Services. We care deeply.”
Smigielski noted that at the beginning of 2025, ESNS had 16 programs. It now has four. She said there is a problem with the current board. “It’s a disconnected, uninvolved board. We don’t see board members at our programs. We need a different model. We need a working board.”
There were a handful of former board members and financial supporters in the audience who offered their assistance.
Audience members asked how the nonprofit could get in such terrible financial straits without the community knowing about it. Committee member Liz Handschy, a director at ESNS’ Menlo Park Academy, said the loss of United Way funding in 2020 was a major factor.
Handschy said the employees of ESNS didn’t know about the financial trouble until their paychecks began arriving late in May of 2024.
Another meeting of the Save ESNS Committee will be held on Wednesday, April 8, at 4 p.m. at ESNS.
The group had asked one board member to attend the March 25 meeting. Board Member Laura Bereiter was there and talked with people later.
“The board is meeting tomorrow morning, and I have about 10 pages of notes to bring to that meeting.”
The nonprofit reached a crisis point in the last several years when its revenue, which mainly stemmed from grants and donations, couldn’t keep up with its spending. The board and its most recent president, Mary Ostapenko-Anstett, agreed to part ways in late 2025.
The board hired Cordes & Company, an insolvency advisory firm with offices in Minnesota, to find a path for the organization. Thomas Plumb, a consultant with ties to Northeast, handled the project.
In February, the board issued a plan outlining the steps that had been taken to save the century-old neighborhood assistance program.
“We have come to the conclusion that partnering with another agency is the best path forward to continue to deliver existing services and meet community needs,” the board’s plan said.
Steps that were taken between December and February included:
• Getting short-term funding to stabilize ESNS’ finances.
• Transitioning three programs — Out of School Time, Family Healing and Aspire — to Change Inc., another nonprofit. The Northeast Child Development Center was paused.
• Further analyze the remaining ESNS programs to determine long-term viability, and to work with staff to build a new operating model.
At the end of that, the plan said, “Our analysis found that ESNS lacks the resources to indefinitely operate independently.”
The board’s plan stated it was seeking options for mergers or acquisitions.
The plan said that in selling or merging ESNS, a successful partner must have a deep commitment to the organization’s goals, have growth opportunities for ESNS, have the resources to reopen the childcare center and have the financial means to satisfy the nonprofit’s debts and acquire the building.
The plan aims to have a new partner or owner by the end of June.
Plumb said in an interview with the Northeaster, “ESNS cannot survive alone, it just cannot.”
Plumb said the board is meeting with several potential partners, and he said that the daycare center may reopen soon.
Plumb said a leadership team at the organization has been meeting weekly to push the plan ahead. Merger candidates have been informed about the ongoing progress at ESNS.
“Some have said that a transaction is imminent, but that’s simply not true. But we are trying to move quickly,” Plumb said.
Plumb said he has heard that employees of ESNS have ideas for the future. “But it sounds more like an aspirational thing. I’m not sure it will pay the bills.”