Regional Development Commissions were authorized through the Regional Development Act of 1969. The Minnesota Legislature found that problems of growth and development transcended boundary lines of local government and that common solutions to local problems could be found by the pooling of resources through intergovernmental cooperation. The HRDC was formed in 1971 by local units of government in this spirit. The Headwaters RDC, also known as Region 2, consists of Beltrami, Clearwater, Hubbard, Lake of the Woods, and Mahnomen counties.
The Headwaters RDC has been involved in issues such as transportation, housing, aging, human services, economic development, and water resources.