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MARCH/APRIL 2015
Contents
THE MAGAZINE FOR GROWING BUSINESSES IN SOUTHERN MINNESOTA
STAFF & CONTRIBUTORS Editor: Grace Webb
COVER STORY
Art Director/Staff Photographer: Kris Kathmann
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Relationship Expert
Advertising Manager: Steve Persons
New Ulm Economic Development Coordinator Brian Tohal has spent nearly the last 20 years of his life building a better New Ulm. As coordinator of the New Ulm Economic Development Corporation, he wears a lot of hats—but to him, everything boils down to relationships.
Contributing Photographers: Art Sidner Contributing Writers: Carlienne Frisch, James Sherk Production: Becky Wagner Circulation: Becky Wagner Printing: Corporate Graphics, N. Mankato
PROFILES
Ahead Of The Curve
Mailing: Midwest Mailing, Mankato
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Cover Photo: Kris Kathmann
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CIRCULATION
Tim Schwanke may have studied diesel mechanics in college, but as he started running his own business, Scwhanke Engines, he quickly found his niche: producing short block engines for racecar drivers around the world. Now, the Springfield-based businessman has 12 distribution centers outside the U.S. and sells 20 percent of his products to international customers.
For The Birds
8,800 for March/April 2015 Published bimonthly
CORRESPONDENCE Send press releases and other correspondence: c/o Editor, Connect Business Magazine P.O. Box 452, Nicollet, MN 56074 E-mail: editor@connectbiz.com (please place press releases in email body)
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When Jeff Traxler set out to start his own business in 1987, he had two ideas: a bait shop or a hunting preserve. It’s probably a good thing he chose the hunting preserve because now, 27 years later, Traxler’s Hunting Preserve has become a milliondollar business with more than 300 hunters visiting every year.
Web: www.connectbiz.com Phone: 507.232.3463 Fax: 507.232.3373
ADVERTISING
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Call: (507) 232-3463
ABOUT CONNECT Locally owned Connect Business Magazine has ‘connected’ southern Minnesota businesses since 1994 through features, interviews, news and advertising.
COLUMNS
Editor’s Letter Grace Notes
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Connect Business Magazine is a publication of Concept & Design Incorporated, a graphic design firm offering print design, web design, illustration and photography. conceptanddesign.com
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IN EVERY ISSUE
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Business Trends
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Bulletin Board
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Hot Startz!
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Press Releases
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National Opinion
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Copyright 2015. Printed in U.S.A.
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EDITOR’S LETTER
The Value of Relationships A lot of factors go into running a successful business: business smarts, organization, the ability to look ahead and prepare for future trends. But beyond the nuts and bolts of every success story, there’s one common denominator: relationships. The March issue of Connect Business Magazine showcases three professionals who understand and cherish the value of relationships. First, there’s our cover story on Brian Tohal, coordinator for the New Ulm Economic Development Corporation. He has spent nearly the last 20 years building relationships in every area of his work, from local businesses to neighboring cities. In order for New Ulm to thrive, he knows the people within it and around it need to thrive, too. Then there’s Tim Schwanke of Schwanke Engines, an engine-manufacturer in Springfield who maintains relationships with customers around the world. He’s so successful at it that his business has 12 international distributors and does about 20 percent of its sales internationally. And finally, there’s Jeff Traxler, owner of Traxler’s Hunting Preserve in Le Center. He credits his success to his team of employees, including family members, and stresses that he wouldn’t have lasted this long without the strong relationships sustaining his business. We hope you enjoy this issue’s selections. An veritas, an nihil, Grace Webb
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By Grace Webb Photo by Kris Kathmann
New Ulm Economic Development Coordinator Brian Tohal has spent nearly the last 20 years of his life building a better New Ulm—one relationship at a time. Brian Tohal has a lot on his plate. As coordinator for the New Ulm Economic Development Corporation, he’s in charge of bringing new business to the city while cultivating the businesses that are already there. One day he could be discussing potential sites for a manufacturing business interested in moving to New Ulm, while the next he could be figuring out financial incentives that will help a local Mom-and-Pop store expand. It’s up to him to coordinate and facilitate the many partnerships that go into growing New Ulm’s business base, juggling interests from the city, the New Ulm Chamber of Commerce, business owners and even other area cities. And besides all this, he’s constantly looking for new ways to promote New Ulm to new businesses. Yet he’s also aware of New Ulm’s heritage and the need to preserve its character. Known as the “German Town,” this bustling 13,500-person city boasts a higher German ancestry than any other city in the U.S. From its famous Glockenspiel to its
many annual festivals, the city proudly displays its commitment to the old ways. Just read the motto: “A city of charm and tradition.” On the other hand, the city also offers big-box retailers like Wal-Mart and Menards, and residents recently approved a $47 million project to build a new high school building. Melding old-world values with new-world progress can be a difficult compromise. It’s a lot of responsibility, and Tohal is impressively good at it. He’s helped create two of the city’s thriving industrial parks, and just last year, New Ulm saw a boom in construction and expansion, with around 400-500 new jobs created. You’d think that’d be a feather in any economic developer’s cap. But Tohal isn’t one to brag about numbers. Instead, he’d rather tell you about a specific business that was able to grow into a new building, or a business owner who found a way to train new employees. It’s the individual stories he cares about. Brian Tohal has a lot on his plate, but it all boils down to relationships. continued > MARCH/APRIL 2015
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Tell me a little about your childhood. I grew up in Le Sueur. My mom worked as a charge nurse and scrub nurse in the Le Sueur Community Hospital, and my dad taught high school social studies. I have six siblings: four sisters and two brothers. I’m the second oldest, and the oldest boy. All but one of my siblings live in Minnesota, so we get together a lot, multiple times a year, as a big family.
Jay Weir
What lessons did you learn from your parents? Both parents were very hard workers who worked long hours. Dad not only taught but also coached multiple sports, and Mother worked long shifts. So they taught me the value of work and the value of standing up for what you believe in. The other thing my parents taught me was respect. You treat people with respect. Do you have any examples of when they stood up for what they believed in? Dad was the United Way president in Le Sueur, and he did a lot of volunteering for political organizations. He would go door-to-door knocking and would take us along once in a while.
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Did that make an impression on you as you grew up? Do you volunteer a lot for special causes? (Laughs) There are too many to list! I volunteer at my church (St. Paul’s Evangelical Lutheran Church) in multiple activities, at Minnesota Valley Lutheran High School and in other community activities. So you invest a lot in others’ growth. Did you have people, besides your parents, who invested in your growth? Any special mentors? Other than my parents, there were a few teachers in high school that stood out. One was a science teacher. He taught me curiosity. I didn’t know it then, but when I look back, that’s what he was teaching. He was teaching: be curious, think about things, learn about things, explore. Later in my work life, there was an individual by the name of Elmo Dowd who was with the city of Mankato while I was an intern at the Mankato Industrial Incubator, and Elmo taught me about work ethic and about how to treat people. Elmo was a great man, and I consider him my work mentor. Tell me about your studies and how you ended up in economic development. I was a nontraditional student. I went to college at Minnesota State Mankato right after I graduated high school in 1976, but I didn’t finish my undergraduate degree right away. Instead, I took time off to earn money for tuition. Because of that, I was able to graduate with my undergraduate degree with zero debt, which just doesn’t happen now. Where did you work during this gap between studies? I worked for a small printing company in Mankato. This was precomputer and pre-printer… Now everyone’s got their own printer,
Brian Tohal | New Ulm Economic Development Corporation
but back then, people ordered envelopes and forms and stationery. It was a very small shop, so I did a lot of different things, but mostly I ran a printing press. I was also in charge of the darkroom and did mock-ups. I did a lot of different chores. I worked there 13 years, until I went back to school in 1989. Then I graduated in 1991 with a bachelor’s in urban studies, and I dove right into graduate studies and earned a master’s in economic development. After graduate studies, or a part of graduate studies, most people do an internship, and mine was the city of Mankato’s newly formed Mankato Industrial Incubator. Elmo was my immediate supervisor. Take me through your career path. After the internship was concluded in 1992, I got a job as the economic developer for Sibley County. I was in charge of the economic development for the entire county, and I did that for three years. Then I took this job in New Ulm and have been here nearly 20 years. So my career’s not very complicated or interesting. You just found what you wanted to do very early on. In my early college years, I took a class called Urban Geography. Following that, I took a class in Urban and Regional studies: Urban Architecture. Those two classes convinced me that there was a career that would fit me very well. Originally, I thought I
Relationship Expert
Getting to know you:
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Brian Tohal Birthplace: Le Sueur, Minnesota. Currently Living In: New Ulm, Minnesota. Job Title: Coordinator of the New Ulm Economic Development Corporation. Education: A bachelor’s degree in urban studies and a master’s in economic development, both from Minnesota State University, Mankato.
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would go on a planning track and be a community planner, but as I learned more about economic development, that’s where my interest laid. And why does that fit you so well? Persistence, patience, trust. You have to build relationships. And it’s the type of job that is unpredictable. I can come into the office and think I’m going to do something all day, but with one phone call or visit, it goes out the window. So it’s never the same thing; it’s always something different. The other thing that I really enjoy is that I get to work with people. Interaction with a wide variety of people keeps things interesting.
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What about the flip-side? What are some of the challenges in this position? The difficulties—or we’ll call them opportunities—can be, often, your work is influenced by things you can’t control, whether it be someone else dragging their feet or a lack of appropriate resources or tools. There’s always more that could be done, but paying for it, finding the time, that kind of thing can be difficult at times. Were you doing the same thing in Sibley? In some ways, yes. In some ways, no. The Sibley County job was seven small communities, all expecting that you promote them. And often that couldn’t happen all the time. However, with New Ulm,
Jeremiah J. Lurken LUTCF President
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Brian Tohal | New Ulm Economic Development Corporation
it’s a very defined geography; you’re working for one community. And New Ulm is a little bigger, so there’s more activities and more things happening. But I enjoyed my time in Sibley County greatly and made a lot of good friends over there. What made you decide to move to New Ulm? There was more opportunity: a bigger community, more chances to get things done, more chances to have an impact. And do you feel you’ve had an impact? I hope so. There are some memorable projects that I’ve been heavily involved in. I won’t say names, since I don’t know if that’d be fair. We had
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one project that was a manufacturer who was, quite frankly, struggling, but had a plan. The owner and I trusted each other, so I knew he was going to work very hard, and we put together a financing package that included 13 sources. That’s unusual, and it took a lot of time and a lot of coordination, but we got it done. All 13 sources were approved in time. Another very memorable project was a four-way swap where we were owning a building and we had a tenant, and the swap involved three buildings and three empty lots, so four different parties all had to be coordinated. But it was the right thing to do for the business. Again, it was the type of situation where I knew the owner of the manufacturing business we were seeking to help very well, and he trusted me, and so we put it together.
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Then there are a number of other businesses that are new to New Ulm that I’ve worked to attract. (The NUEDC) has been involved in developing industrial parks since the early 1950s, and I’ve been involved in the development of two of those industrial parks. And again, a lot of attracting a new business is the business itself. They’re the ones that create the jobs. I don’t create jobs; I just help businesses when I can. I see myself as a facilitator. But I think the most memorable thing is the relationships that you build over 19 years and the people you get to know. You can’t do this job without building relationships and building trust in both directions.
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Speaking of building trust, your corporation works with both the city of New Ulm and the New Ulm Chamber of Commerce, along with countless businesses. What’s it like juggling so many interests, especially on the city side of things? I think New Ulm is very fortunate to have the people who work at city hall that they do. The city has a very strong role in economic development, and they’ve been very supportive historically. In particular, the city manger, Brian Gramentz, has been a strong supporter of economic development, and the community development director, Dave Schnobrich, has also consistently supported it. Both of those two have done quite a bit to promote New Ulm as a place for industrial growth and expansion. In addition, councils over the years have also been very, very supportive. Besides working with so many different groups, your corporation itself is made up of a board of 11 volunteer directors. When you add your employee position as their coordinator, that’s 12 people with 12 different viewpoints. How does that work when it comes to making decisions? It works very well. My board consists of business people who understand what needs to happen. They’ve been very supportive over the years, very supportive. The New Ulm Economic Development
Brian Tohal
Corporation started in the 1950s as New Ulm Industries. How has it changed over the years? When it started in 1952, it was an allvolunteer board. People promoted New Ulm on their own dime because they were business leaders and they knew that what was good for all of New Ulm was probably good for their business, whether it’s business owners or bank presidents. In 1991, we changed it to a nonprofit for tax reasons. We changed the name, too. Is it basically the same thing? The original entity was technically a forprofit organization that had shares, so it had a local base of ownership. We’re now a non-profit so shares don’t exist. Our funding doesn’t come from members; it comes from the city and our own funds that we’ve earned, from our own assets. We also used to have the New Ulm Retail Development Corporation, which I oversaw as president, but now the duties of retail development promotion and coordination have been assumed by the Chamber, so that entity is no longer functioning. I know a lot of cities struggle with how to bring in new businesses while maintaining their culture, and I’d suspect that’s a real question in New Ulm since the city is so well known for its German heritage. It’s a balance. New Ulm has a brand—it’s known as the German Town, and the town that has a lot of festivals. You don’t ever want to stomp on that. You don’t even want to go near stomping on that. But at the same time, it’s normal for businesses to open and close, so we need to maintain a healthy economic environment. And that means that you provide assistance to businesses that want to grow and need some help, and you work to attract new businesses to town. That just makes good sense. What are some of the trends you’ve noticed in New Ulm recently? A number of our manufacturers are in the middle of expansions or planning expansions. Last year was a big year for new construction, and not just in manufacturing: apartment buildings, office buildings and other large building projects. We’ve seen a
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spurt of growth and I would anticipate that would continue in 2015. So is New Ulm seeing more current businesses expand right now, instead of new businesses coming in? There’s some of both. The businesses that have relocated here or started up that didn’t exist before recently are small, but most of them have fantastic potential for growth. Small businesses that are locally owned are important. What’s more important for a city, helping current businesses expand or attracting new businesses into the area? Without placing importance, but talking about where most of the new jobs come from, it’s expansion of the existing businesses. You can infer importance from that if you want. What are some of the challenges New Ulm businesses are facing right now? I think the biggest challenge in New Ulm
right now is the availability of workforce. Just about every manufacturer is hiring. If you can’t hire the number of qualified people you want, it restricts your business growth. And I think we’ve seen some of that in New Ulm. What can you do to address these workforce concerns? One example would be we’re working with South Central College right now to try—I’m going to emphasis “try,” since it hasn’t been approved or funded—to establish a truck driving school. New Ulm has one of the largest truck driving companies in the state (J & R Schugel Trucking), but truck drivers are in short supply. The other thing that we try to do is we try to promote the state’s program called the Job Skills Partnership, which funds job training. Through this, businesses can work with community colleges for more workforce education. Are there other concerns New
Ulm business owners have? I know there are a number of businesses that have expressed concerns over the availability of nontraditional financial resources. Sometimes, there’s a need for nontraditional financing beyond a bank, and that can be difficult. Does New Ulm offer financial incentives to help with these concerns? We offer a lot of different incentives. Probably the most popular is tax increment financing, and up until recently, we also had the JOBZ incentives offered through the state of Minnesota. New Ulm also offers an incentive that provides businesses with cash payments for job creation and a cash rebate on their utility bill. They’re not huge, but they’re multiple thousands of dollars twice a year. Besides those, New Ulm offers a couple of different revolving loan funds where they’ll partner with a bank to provide financing for job growth and business expansion.
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Brian Tohal | New Ulm Economic Development Corporation
Do you ever get into battles with other cities as businesses try to pit your incentives against each other? When that does happen, and a business tries to pit us against another community, the first thing I do is pick up the phone and call the other community. Does it happen? Yes, it does. Not very often. We typically try and identify what a business needs, as opposed to the business saying, “I want everything I can get.” Instead, we ask, “What do you need to be successful?” A lot of that leadership comes from Brian, the city manager. Have we lost businesses to other communities, other states? Yep, more than I’d like to admit.
done in 2018. Now we know it won’t. How does this affect your city? First, New Ulm sends a lot of trucks out and accepts a lot of trucks in, with Kraft, 3M, and the other trucking companies. So trucks can get in and out of New Ulm already. But for a lot of people, perception becomes reality: “You don’t have a four-lane? You must have difficulties getting trucks in and out.” It’s a perception, not a reality. Having said that, often the existence of a four-lane to your community is siteselection criteria. So for those who decide there has to be a four-lane, we don’t make their list. So it has a negative impact.
I think that’s just inevitable. You can’t get them all. No, but we want more than our fair share (laughs).
It doesn’t sound like New Ulm can really help that… New Ulm has been involved in the Hwy 14 Partnership (an advocacy organization formed in 1998 that includes local governments, private businesses and other organizations) for as long as I’ve been in town. And the city has actively promoted the expansion
Years ago, MnDOT did long-range planning to increase Hwy 14 to a four-lane to New Ulm, saying it’d be
of Hwy 14 for many years, to legislators, St. Paul, Washington and MnDOT. MnDOT has announced that they will be expanding from Nicollet to North Mankato starting this year. The next leg, from Nicollet to New Ulm, has not been funded and is not currently on any longrange plans. So that’s the next target, to get that stretch back on their long-range plan. I’m confident that it’ll happen eventually. It’s a very busy road, and it’s a dangerous road. And I think that’s more important than anything—there’s been too many deaths on that road. I think most people in New Ulm know someone who’s either died or been in an accident on Hwy 14. What have been the pros and cons of big-box stores like Menards and Wal-Mart moving to New Ulm? I think the pros to both of those large big boxers moving into town is that we’re bringing shoppers into New Ulm that wouldn’t have normally come here. They aren’t going
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to Mankato. They aren’t going to wherever else they went to before for their Walmart and Menards items. So it brings people in. On the negative side, obviously, it’s got to hurt the locally owned hardware stores and locally owned businesses that compete with them.
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Could local businesses combat this loss of foot traffic by going online and investing more in e-commerce? There are a number of businesses in New Ulm that lend themselves to e-commerce, especially specialty retailers. I’m probably not going to buy a pair of shoes online, but I might buy a cuckoo clock, or a German hat, or German chocolates. New Ulm businesses that sell those items utilize the internet in some way. I think the biggest issue with the internet right now is its speed. For the providers, it’s very difficult to keep up with the new technologies, particularly if you’re a provider in a small community, as opposed to a very large, maybe national-style provider of internet services. It’s a continual investment, and people—businesses—are expecting faster and faster speeds all the time. At one time, I was at a conference where some recent college grads were speaking, and they said that they chose their community because of the speed of the internet that was available. That was amazing to me. And that’s been a few years, so I think that trend continues. I understand that New Ulm passed a referendum last year approving $47 million for a new high school and renovations to current schools. If I remember right, it was a pretty tight vote. Actually, it was a surprisingly strong vote in favor. Not huge, but bear in mind that New Ulm has multiple K-12 school systems and a relatively high elderly retired population. I’m not saying anything as a rule, but it’s harder to get a public school referendum approved when you have those things. I think what it says to the rest of the world is: New Ulm values education and we’re willing to put our money where our mouth is. And how does this affect businesses, beyond the upcoming construction jobs? Beyond the construction, there’s a ripple
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Brian Tohal
effect. Construction companies spend money on a lot of different things, and that money gets cycled through the community. Then, from a marketing standpoint, it’s a tangible thing we can point to and say, “This is a progressive community. Our youth are important. We invest in education.” If I move to a community, that’s important to me. I want to be in a community that values education and youth and has good schools. One New Ulm community leader, Denny Warta, has said we should have a regional Economic Planning Authority. The likely choice would be Greater Mankato Growth. Do you ever see yourself handing over economic development responsibility to them? The reality is, there is already a regional planning entity. It’s called the Region 9 Development Commission, and it assists communities as needed with a wide variety of things. As for merging with Mankato, I think that New Ulm needs to maintain its autonomy. There’s no one that promotes your community better than people in your community. I know regionalism is important. There are certain things that can be done regionally more easily: promotion, marketing, those types of things. Many regions across the country promote themselves as a region, and when you do that, what you’re doing is you’re saying there’s a population base of 200,000 instead of 13,500, and there are more resources available. So it’s a very common thing to do promotion and advertising on a regional basis. But if I get a phone call from an industry that’s looking to expand and wants to know where there are some available buildings, I’m going to keep them in New Ulm, and I’m not going to share that lead. And I would expect other economic developers to be similar. Does that mean that you see other cities as competition? No, not really. We meet as regional economic developers on a monthly basis. I know the economic developers in southern Minnesota. I certainly have known Jonathan Zierdt in Mankato for many years, and I think very highly of him. It’s poor economic development strategy to try and go steal somebody else’s business
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because that just doesn’t make any sense. That’s not economic growth; that’s shuffling the deck. Most of the economic developers in our area don’t do that. Occasionally other economic developers in other communities will say, “I got a phone call from a manufacturer in your town, and they’re looking for x.” And I’ve done the same. If somebody from a neighboring town calls, I’ll call their economic developer and say, “Have you visited with these people?” That’s different from maintaining some autonomy. You can support each other and still be autonomous. What’s the process once a business approaches you with the interest of relocating to your city? It’s all over the board. We have one manufacturer in town that we had contact with over a 7-year period. Others, it can be a few months. So everyone is different. One trend that we see in economic development is that a lot of the larger businesses and national-style prospects use site selectors. Site selectors do their due diligence online, so we may not even know we’re on a list; we might not know, and I’m sure it happens frequently, that we don’t make it to the final
five. We might be in the final 10, but we just never know that, because the site selector’s gathering information on the internet. Say you make it to the top of the list. Then what happens? Typically, we like to sit down with the city manager and the community development director very early on, because the city is the one that provides the incentives, not NUEDC. We’re the coordinator, the marketing arm, per se. The actual cash incentives are provided from the city. So we need to get them involved right away and make sure that everyone’s working together. Typically if there’s a request for assistance from the city, it goes to the city council, and with things like tax increment financing, there’s a requirement that there be a public hearing. So that all needs to be scheduled, and there are certain things you need in hand to make the public hearing viable. You need to have at least the beginnings of a development agreement in place. The development agreement spells out what the business will do and the city will do. For the business, it’s usually an identified amount of capital investment and a number of jobs to be created in the period of a year
Relationship Expert
The History Of NUEDC At the start of the 1950s, New Ulm’s largest employer was the Eagle Roller Mill, the largest rye flour producer in the country, which employed 350 people. However, the growing demand for white bread eventually forced the mill to close its doors in 1951. “Business leaders in the community said, ‘What are we going to do?’” Tohal explained. “So they formed a for-profit corporation and sold shares.” This corporation started as New Ulm Industries when it was first incorporated in 1952, with members collecting $40,000 of capital to build their first factory spec building (which is now part of the 3M building in New Ulm). Two years later, the corporation was able to attract a Kraft Foods plant to the city, which continues to be one of the largest employers in New Ulm. In 1991, New Ulm Industries was converted to the nonprofit New Ulm Economic Development Corporation.
Brian Tohal
Bill LeDuc Broker/Owner Mankato, MN (507) 995-9311
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New Ulm Economic Development Corporation Address: 1 North Minnesota Street New Ulm, Minnesota Telephone: 507-233-4305 Web: newulmedc.com
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or two. For the city, it’s what we will provide in terms of TIF, revolving loan fund, tax abatement, etc. The whole process is prescribed by state statute. So then what? You finalize the development agreement, or the loan agreement in the case of the revolving loan fund, and then you stay in contact with the business to verify their performance. Most of the reporting is done by Dave Schnobrich, but at times I’ve contacted businesses to gather information. And a number of the businesses that are participating in some of the incentives, I contact at a regular basis to get information about new hires, capital investment, etc. Maintaining a relationship with those people is important. If a business is considering an expansion and they’re putting together some financial modeling, and we can have a possible impact on that financial modeling as a community by providing incentives, then the business should know about that. So by maintaining a relationship, my hope is that the business owner or the managers would have a comfort level in picking up the phone and having an informal conversation, saying, “Now if we were going to do this, what would be available to us, and can you give me some rough numbers?” Does that happen to you a lot? It happens to me frequently. A trust relationship is something that’s earned and should be maintained. And I place a high value on that. Economic development in New Ulm is about partnerships. And the success of economic development activities is based on the strength of those partnerships. We don’t do it alone. It’s not just about the NUEDC; it’s about the community as a whole.
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BUSINESS TRENDS
POVERTY RATE
According to data released by the Department of Agriculture (USDA) in January, there are more Americans on food stamps than there are people living in Colombia or Kenya. A CNSNews.com report shows that the number of people using the Supplemental Nutrition Assistance Program (SNAP), also called food stamps, has held steady at more than 46,000,000 for the 38th straight
month (going back as far as Sept. 2011). As of October 2014, the last month included in the department’s analysis, there were 46,674,364 Americans on food stamps. And that’s an increase of about 214,400 from the September 2014 numbers. These numbers are an increase of nearly 1,517 percent from the number of people on food stamps in 1969, when about 2,878,000 people participated in the program. Households using food stamps see average benefits of about $261 a month, leading to about $6,978,000,000 a year paid out by taxpayers. In Minnesota, about 504,000 people use food stamps, a number that’s nearly double what it was 10 years ago, according to Minnesota Public Radio. And Minnesota’s welfare spending is consistently some of the highest in the nation, with nearly a quarter of state and local government spending going to welfare services. More than a million Minnesotans receive welfare in some way, whether it’s food stamps, Medicare, childcare or other financial supplements. Since President Lyndon B. Johnson launched the “War on Poverty” in 1964, taxpayers have spent more than $22 trillion (three times what we’ve spent on every war we’ve ever been involved in) to eradicate poverty. Federal welfare spending has grown by more than 32 percent in the last eight years according to the Washington Times, with
taxpayers funneling $920 billion into 80 different anti-poverty programs last year alone. But it looks like all our dollars aren’t making much of a dent. In fact, according to recent studies, poverty is increasing in America. The U.S. Census Bureau reported that 31.6 percent of Americans were in poverty for at least two months from 2009 to 2011, which was an increase of 4.5 percent from the pre-recession period of 2005 to 2007. As of right now, about 50 million Americans live below the “poverty line,” which is defined as an annual income of $23,492 for a family of four. Blue Earth County found itself in the news—and not in a good way—when census data showed it to have the third-highest poverty rate in Minnesota. However, Greater Mankato Growth analyzed this report and found it was skewed by the high percentage of college students in the county, since college students on average don’t earn as much as those in higher age groups (25 and up). GMG went on to find that Blue Earth County has the highest percentage of college students in Minnesota, as well as the second-highest rate of poverty among students. When the college population is excluded, the county has a 10.7 percent poverty rate, which lands it 43rd out of 87 counties. Blue Earth County also has about the same poverty rates as other “college towns” such as Duluth (at 12.4 percent) and Saint Cloud (at 13.2 percent).
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Elmore: 507-943-3131 Lewisville: 507-435-2451 Madelia: 507-642-3251 Mankato: 507-345-7069 Mapleton: 507-524-3630 North Mankato: 507-625-3268 St. James: 507-375-3201 Lake Crystal Loan Production Office: 507-726-6475 MARCH/APRIL 2015
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BUSINESS TRENDS
CYBER-THREATS
As fears about cyber-terrorism continue to rise, President Obama has proposed legislation that would shield businesses from liability if they reported information about cyber-threats. The president first outlined his proposal in early January, fleshing out the concept during his State of the Union address. Part of this proposal revolves around businesses,
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This isn’t the first time such legislation has been suggested, and some companies have already been sharing cyber information with the government for more than a decade. which would be encouraged to share cyberthreat information with the Department of Homeland Security’s cybersecurity center. If companies came forward with such insider knowledge, they would receive “targeted liability protection” as long as they took steps to protect consumers’ personal information, such as removing personal data before sharing it with the government. Other provisions within the proposed legislation include prosecuting the sale of botnets (computer networks created to commit cyber-crimes), criminalizing overseas sales of stolen financial information (such as bank account numbers), and giving courts the power to shut down those involved in denial of service attacks and other fraudulent activities. In addition, the president also wants to expand federal law enforcement authority to crack down on
the sale of spyware used to stalk or commit identity theft, and he is calling for companies to report data breaches to consumers within 30 days of discovery. This isn’t the first time such legislation has been suggested, and some companies have already been sharing cyber information with the government for more than a decade. The Sharing and Analysis Centers were established in 1998, while the National Infrastructure Protection Center to the Homeland Security Department was created in 2003 (but is no longer functioning). However, in an age where Americans are already wary thanks to warrantless wire tapping, privacy advocates in Congress have voiced concerns about whether this legislation would be too intrusive. We’ll have to wait and see how the legislation evolves as it travels through Congress.
TRANSPORTATION
Transportation was the name of the game during a recent trip to the capitol hosted by Greater Mankato Growth. In mid-January, dozens of local business owners and professionals joined GMG to visit the capitol, hear from legislators and share their concerns. And while not everyone was aware of Minnesota’s transportation troubles before the event began, everyone was talking about them afterwards. According to Gov. Mark Dayton, the state faces a $6 billion deficit when it comes to infrastructure spending for the next 10 years. Adding to these concerns is the fact that Minnesota has maxed out on the borrowing available to it for street projects. The state is facing about $120 million in debt due on highway bonds this year, and projections
put the debt closer to $190 million by 2016. The state pays for its roads and bridges in a variety of ways, including vehicle registration fees and car-sale taxes. However, the most money comes from the state’s gas tax, which is currently 28.5 cents a gallon. With the recent low gas prices, that means about 17 percent of every gas bill is straight gas tax—adding up to about $860 million a year for the state. Dayton is proposing to change the gas tax to a wholesale tax of 6.5 percent, which would help counter the problem of inflation but could run into problems if gas prices continue to decrease. His idea mirrors a plan put forth by Senate democrats, who aim to raise $7 billion over the next 10 years by increasing the gas tax, setting higher car registration fees, adding a one-cent increase to a metropolitan area sales tax for Twin Cities transit projects, and borrowing more than $1.5 billion for other projects. House Republicans have also proposed a transportation plan. Their plan would funnel about $187 million a year into roads and bridges for the next four years. Most of that would come from money already in the Department of Transportation’s budget and also from dipping into the state’s $1 billion surplus for $200 million. However, this plan wouldn’t raise nearly as much as the Minnesota Department of Transportation says is necessary for the next 10 years. The two groups will continue to work towards a possible compromise during the 2015 legislative session.
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GMG representative Patrick Baker introduces one of the panels of legislators who talked about transportation issues affecting Minnesota. MARCH/APRIL 2015
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CONNECTING BACK
5 YEARS AGO
MARCH 2010 Floyd D. Palmer, founder of Palmer Bus Service in North Mankato, was the main feature of this issue. Profiled companies included United Commercial Upholstery in Nicollet and Volk Electric in St. Peter. Great quote from Palmer about the importance of putting family before business: “Many times, I put business ahead of my wife and family. I tell people in business not to do it. I don’t care how much money you can make doing it. Don’t do it. You never put business ahead of family.” 10 YEARS AGO
MARCH 2005
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Our cover story was Doug Thomas, cofounder of EdVisions Cooperative—a unique co-op started for Henderson teachers to negotiate and contract directly with their public schools. Profiled companies were Nuvex Ingredients in Blue Earth and North Star Aviation in the greater Mankato area. One good Thomas quote: “Students need to learn how to organize, research, make decisions, and work alongside others. They need to practice those skills in school. Most people don’t function well in our democracy because they never had the opportunity to practice democracy in school. So they don’t know how to do it.” 15 YEARS AGO
MARCH 2000
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Our cover story featured Pat Johnson, a statewide expert and leader in workers’ compensation insurance industry. Profiled companies were Dwayne Pipping in Nicollet and Two Fish Recording Studios in Mankato. 20 YEARS AGO
MARCH 1995 507-345-5554 • Mankato, MN www.NorthernEnergyHomes.com 26
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This issue didn’t feature a cover person— that didn’t begin until 1996—only a theme, “Commercial Real Estate,” which featured Winland Electronics, Inc. and Robinson Appraisal Co., Inc., both of Mankato.
Read the entire articles at connectbiz.com
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By Grace Webb Photo by Kris Kathmann
Springfield engine shop owner racks up a terrific track record while outfitting racecars around the world.
If you heard Tim Schwanke’s life story, you would probably sum up his career in one word: evolution. The Springfield auto shop owner entered the automotive industry 36 years ago straight out of college, offering diesel and transmission services to local customers out of an old Oldsmobile dealer shop he rented for $200 a month. However, Schwanke knew there was more his business could offer, and he led the way into engine manufacturing, car restoration and even the wild world of go-kart racing. Now, Schwanke Engines is situated in a sprawling 25,000 square foot building that boasts $800,000 worth of equipment in its main assembly rooms alone and builds engines for customers across the globe. But when it comes to describing his business, Schwanke would use a different word: family. With his wife helping on the accounting side of things, his son acting as head engineer, his daughters manning the go-kart track and his trusty dog, Rover, watching over the office, Schwanke Engines is definitely a family-run business. But Schwanke’s family goes farther than that. There are his handful of full-time employees, most of them family friends who have known him for decades. There are the kids he hires seasonally to help at the go-kart races. And broadening his circle even further, there are his hundreds of customers—which he treats like family too. “When you’re involved in the racing industry, which is a huge industry, it’s a big family,” he said. “It’s a way of life for us—you’ve got to work together. We have such a vast portfolio of people whose lives I’ve touched over all these years… I live my dream every day, and I encourage others to do so, too.” continued >
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Ahead Of The Curve
Schwanke was born in Windom in 1961 and moved with his family to a 700-acre farm outside of Sanborn a few years later. There, the family raised Holsteins and hogs. Schwanke said his father took care of milking the cows, while he was responsible for the 1200 hogs. “I grew up pretty hard core,” he said. “On the farm, in those days, you really worked together as a family. You fixed a lot of your own stuff. You had to—it was cost effective, and when you needed it, it was right now. And those lessons learned in those days, I still believe in today. It’s part of what I am and what we do here.” When it came to fixing things, Schwanke found out early on that he had a fascination with all things mechanical. His father, besides being a farmer, was also a mechanic for a tractor implements dealer, and his grandfather owned a junkyard nearby. “I learned a lot about business and a lot about cars from a pretty early age, and I’ve always had that interest,” he said. “I spent a lot of time at my grandpa’s junkyard, and he’d always send me home with something to take apart. And Dad helped me a lot, too.”
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“When I think back, it’s pretty amazing about how all those little things that you did, that you didn’t realize at the time, actually made you the person you are today. As I think back now, I get it.” When he wasn’t working on his farm or with his grandfather, he was helping neighbors on their farms. And when he wasn’t at a neighbor’s farm, he and his sister managed to make some money harvesting ditch hay to sell to local stockyards. They paid their father $30 to borrow his haying equipment and sold their produce for $60 a rack. “That was probably our first real job outside of home,” he said. “We’d go bale wherever we could. We didn’t look at a road ditch like anyone else; it was a profit to us. We’d work our butts off when we could, because that was our play money. Those were the things we learned: to get things done and be ambitious.” Scwhanke also became very involved in his local FFA (Future Farmers of America). He won the state mechanics proficiency award and finished third in the nation in 1978, and acted as chapter president during his junior and senior years. He credits his time in the FFA with teaching him business essentials such as bookkeeping. One task he was responsible for was organizing yearly fruit sales with his vice president. Every year, the kids in his chapter worked to sell a semi-truck load of fruit around their area. Schwanke said the highlight was being allowed to skip classes to sell the fruit when
Schwanke Engines | Springfield
they were upperclassmen. (“We were seniors, so we’d get away with that,” he explained.) Whenever they finished, they donated 50 percent of the profits to Camp Courage, a summer camp for children and adults with disabilities. “You learned a lot about taking care of people and working with people,” he said. “When I think back, it’s pretty amazing about how all those little things that you did, that you didn’t realize at the time, actually made you the person you are today. As I think back now, I get it.” When Schwanke graduated from high school in 1979, he started attending college at Willmar ATVI, where he studied diesel mechanics. Once he graduated in 1981, he originally planned to come back to the family farm, but his dad gave him different advice. “I really wanted to stay with farming, but my dad encouraged me to rent a shop in Springfield and do both,” he said. “As it turned out, I had more interest in the mechanical side of things and working with people more directly, and elected to continue to adventure in the mechanics world. “I like the way things are put together and understanding how they work; I like to understand how they came to be, especially automotive and agriculture stuff. One of my role models is Henry Ford. I’ve
read books on him and still work with some of his projects today, like the Model A engines I rebuild. I was really inspired by his activities from an early age, and that’s probably where the interest came when it comes to old cars. My passions are race cars, street rods, performance muscle cars, anything to do with speed and gears and going fast.” Schwanke’s first shop was called Tim’s Automotive Business and functioned as a diesel service and transmission shop. He moved into an old Oldsmobile dealer shop, which he rented for the next 14 years, and started working for area car owners. “That’s really where it all got started,” he said. “After a few of the local people realized what was going on, I started working for some of the local farmers, and I still do some work for them today. We don’t do a lot of service work today—maybe a couple dozen people. I don’t have any interest in it, and I didn’t want to step on toes of other people. There was kind of an unspoken agreement when I had the [parts store], that I’d sell products to other mechanics but not compete against them, and I still believe in that.” In 1981, Schwanke found his niche in the high-speed world of car racing. Several circumstances converged at once. First, he started
Ahead Of The Curve
Ready, Set, Go-Karts Besides working on cars, Schwanke owns a go-kart track and stages races every weekend. He has a long history with go-karts, having built 13 for neighbor kids and himself before he graduated from high school. “I just bolted and welded the stuff together,” he said. “My dad helped a lot. I got a lot of my engineering experience from that, a lot of my interest in smaller engines at the time. I usually sold them. You didn’t make any money, but you [got back] the cost of products.” In the late 1990s, he started staging go-kart races in the parking lot of his business, attracting local kids. All four of his children raced and were good at it, winning competitions around the area. In 2006, he was asked by a member of the Springfield City Council to turn the city’s unused ice hockey rink into a go-kart track for local kids. He started with about 10 go-karts, renting them out for $5 a ride every Friday and Saturday evening. The events
became so popular that 50-70 people were coming every weekend, and he added bleachers and a concession stand. He even found local businesses to be race sponsors. During the fall of that year, he started hosting league racing, where racers would come on Sunday afternoons to compete for points and trophies. Eventually, 60-70 racers were showing up. “Anything I do just seems to turn into a whirlwind, because we just go whole-heartedly at it,” he said. “It was just fun—another type of fun.” He moved the racetrack to its current location in 2011, because the city park kept getting flooded. The new track includes 1,400 feet of underground wiring, 15 amps of service, irrigation and a state-of-the-art PA system—which Schwanke uses to announce races personally and also broadcast the National Anthem before every race. The track has 15 degree banking, and drivers can turn lap times of under seven seconds. Schwanke still offers league races during the summer, attracting 40 competitors in six different racing classes every night while the stands are packed with up to 450 spectators. On other nights, he rents out the track for parties. People can pay $10 for a ride or rent the whole track for $350 per hour.
Ahead Of The Curve
rebuilding short block engines in his shop. He had been rebuilding all parts of the engine before, but he realized it was more cost-effective, while still offering a large market, to focus on short blocks. At the same time, he hired a traveling salesman who quickly noticed a prolific but untapped market: sprint racecar engines. And he also started racing his own cars at meets across the United States. He started with stock cars, racing Camaros, and eventually moved on to sprint cars. He and his team would build the entire car except the chrome modeling, and the crème de la crème was the short block engine. While other racers’ engines, salvaged from junkyards, would blow up after two or three races, his engines would last all season. The cars his team created averaged about 120 mph but could hit speeds of more than 140 mph during the straight legs of their races—and they left their competition in the dust. The trick, he explained, was finding ways to rebuild the short block engines more cheaply than others could and investing the savings into a quality tires, shocks and other components. And it worked; he did so well that he was invited in the late 1980s to join the touring team “World of Outlaws,” racing across the state. He would drive 35,00040,000 miles every summer for his races, working maintenance on cars three or four nights a week. He even added a dynamometer into his store to test his engines, the first in the country and one of only 12 in existence in the U.S. When he wasn’t using the dyno for his own cars, other teams would come from across the Midwest to test theirs. He was never the racecar driver, except in three mechanics’ races, where he took first place every time. His cars won every major championship except one before he decided to retire in 1994 so he could spend more time with his family (“probably the last time I’ll retire,” he noted). He had married wife Jan Schwanke in 1984 and
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The Tim Schwanke File Birthdate: Aug. 4, 1961
SALES • INVESTMENT • DEVELOPMENT • LEASING Tim Lidstrom, CCIM Broker Karla Jo Olson, Broker Dan Robinson, Agent
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Family: wife Jan, children Jeremy (28), Crystal (26), Tiffany (19) and McKenzie (15), dog Rover. Lives in: Springfield. Hobby: Sleep. Most valuable tangible possession: a 1951 Kaiser, which had been his dad’s last car.
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Schwanke Engines | Springfield
by then, they had three of their four children: Jeremy, Tiffany and Crystal (fourth child McKenzie would arrive in 2000). Once Schwanke retired from racing, the work orders started flooding in. “When I decided I had enough of that… the day after that was the next busiest day of my life, because everybody wanted our secrets,” he said. “They wanted to know what we did to make them go fast, and so for a price, I’d put it out there. And that’s when the sales really took hold. We actually created a market that was a demand but never asked for. Nobody did what we did in those days. We learned how to produce a short block for a very low cost, minimal time, but yet a good quality product. And that word got out in the racing industry very quickly. “We didn’t tell them all the secrets, but we made them go faster. In racing, you have a point sheet. If you were outside the top 10 of points, my goal was to get you inside the top 10 the first year and then get you the top 5 the second year. We were very successful at that. Customers today that we do engine work for have been able to go on and win some of their dreams, and I’m glad to be part of that.” As Schwanke found success with his short blocks, his business continued to evolve. Even while he was racing, he had started to expand, buying a gas station in 1985 with the hopes of making it into a transmission shop since space was getting tight at his original site. While he quickly learned that he wasn’t cut out for the “oil baron” business, selling the station in 1989, he found more success with the machine shop he added the same year that he bought the gas station. “That machine shop part of it came from the thought of, ‘Let’s get it done,’” he said. “I was sending work out to get it done, and I’d be
Ahead Of The Curve
Old Cars While it’s not the main part of his business, Schwanke enjoys buying and restoring old vehicles. He does it for customers and he does it for himself, too. He currently has 27 vehicles that he’s working on. One of his favorites is his Model A, which he’ll take out for drives in the summer. Schwanke said he finds most of the vehicles at estate auctions, but he has been known to pass up a good deal for the right cause. “You’ve got to respect the family,” he said. “In many cases, I’ll stop an auction and say, ‘Does anybody in the family want this car? Because if you do, I’ll quit bidding right now.’ A couple times, they’ve said yes, and I’ve just stopped and let it go.”
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Ahead Of The Curve
“Everybody thought I was nuts,” he said. “We had a $1100 payment a month, for seven years. I remember that very well. I never missed a payment, but it was really a struggle.” impatient. I’d wait for people to do what I needed to be done. I’m still that way today. I just liked the hands-on part of it. I’m a working boss. I’m involved in almost every aspect of what this business does, other than some of the internet stuff. That new stuff is way over my head.” After selling the gas station, he bought a building south of Hanska that had previously been a horse barn. This became his transmission shop, and he still uses it today, now as a body shop. In 1990, he had the chance to buy the local Big A Auto Parts store and took it, figuring it’d be cheaper than always having to buy new products for his projects. He didn’t buy the
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building, instead transferring the inventory to his original shop. He ran his parts store until 2013, when he sold it to focus more of his time on what he enjoyed the most. Around the same time, another building went up for sale in Springfield. This one had housed a grocery store before it went out of business, and it offered 7,200 square feet of space—far larger than his Oldsmobile dealership. In 1992, he bought the building and started a yearlong process of moving out of the old rented location and into the grocery store. “Everybody thought I was nuts,” he said. “We had a $1100 payment a month, for seven years. I remember that very well. I
never missed a payment, but it was really a struggle. I still have that property today as well. We rent it to Schwartz Farms. They’ve rented it three years now.” Thanks to the new space, Schwanke was able to build a new machine shop in the back and buy more equipment. And that’s when things really took off—thanks in part to the newly thriving internet. Schwanke began posting his short block engines on online racing sites, marketing them for $1,429 each. “We just started posting some ideas and short blocks for sale, and, virtually overnight, we had phones ringing off the hook,” he said. “They sold like hot cakes. We stocked 15-20 on a shelf, all
Schwanke Engines | Springfield
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the time, and sold 2,000 short blocks within seven years.” Schwanke said some of their first customers were from Utah and Ohio but soon their market had expanded to every state in the U.S. “I really found my niche,” he said. “I struggled a lot, both financially and with people, but once I got involved in that part of it, and found the short block side of things, I really had interest in that. Then the international sales started.” Schwanke estimates that his business does about 20-25 percent of its sales internationally. There was such a demand that they’ve set up 12 distributors outside of the U.S., in countries as diverse as South Africa, Brazil, England, Saudi Arabia and Indonesia. According to Schwanke, the biggest challenge with international sales is the expensive shipping; it can cost upwards of $8 per pound to mail packages (not cheap when short blocks can weigh more than 150 pounds). In 2010, he expanded his business once again, moving into his current location—a 25,000 square foot school building located on 19 acres on the outskirts of town. On a typical workday, you can find short block engine projects in the works for customers from Texas to New York. Schwanke’s engines now sell for about $15,000-$20,000 each and take about 39-40 hours of assembly. He estimates they sell about 70-90 engines a year. Looking to the future, Schwanke said he plans to add a showroom and museum to his facility to show off his car restoration projects (he currently has 27). And eventually, he’s planning on Jeremy taking over the business. But for right now, he’s not going anywhere. “At this point,” he said, “Rover and I are going to hang around.” Comment on this story at connectbiz.com
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GRACE NOTES
Let me tell you two stories about two vehicles that end in two very different ways. The first takes place my sophomore year of college. As I prepared to go back to school, my parents informed me that they were going to let me take their 2002 Buick Park Avenue to campus with me. After a year of having to rely on my friends for a ride, I was thrilled. The fact that my parents were also still paying for the insurance and any maintenance issues made the whole deal even sweeter. I was only responsible for my gas… though my parents usually filled my tank up too when I would visit home. This giddy freedom lasted about eight months, until the end of spring semester the next year. And then disaster struck. I was driving up a hill to campus when my acceleration died as smoke started pouring out of the hood. I managed to ease it over to the side of the road and called my grand-
30%
father, who lived nearby, for help. Once we limped it into the nearest auto shop for an examination, we were told that the engine had been destroyed because of a lack of oil. I’d seen the “low oil” warning flash on my dashboard for weeks previously, but I’d ignored it, figuring my parents would take care of it when I made my next visit home. Now my car was beyond repair. On to the second story. A few months ago, I bought a 2003 Kawasaki Vulcan. I took out my very first loan to purchase it, and I started my first ever insurance plan. This bike is beautiGrace A. Webb Editor ful—and I’m obsessively careful with it. I despair if I even scratch the paint. When I’m not riding it, you can be sure it’s tucked safely in the garage. So what’s the difference between the two? It’s simple: with the first vehicle, my parents gave it to me with no strings attached. It was free. I took it for granted. With the second, I plunked down my own hard-earned money for it, and I’m still paying for it today. A lot is tied up in this motorcycle, and I want to be able to enjoy it for years to come.
This mentality is true with almost anything: you appreciate something more when you work for it yourself. And that’s why I think there are some major flaws with President Obama’s proposal to offer free community college to any interested students. The president unveiled his plan during January’s State of the Union address, promising that it would save about nine million students an average of $3,800 in tuition every year. This tuition would be covered by the federal and state governments instead (funding 75 percent and 25 percent, respectively), to the tune of $60 billion during the next 10 years. There are some caveats: Students must maintain at least a 2.5 grade-point average and also attend school at least half-time. There would be certain quality benchmarks in place, and credits would have to be transferable to a four-year college or result in a two-year professional certification down the road. Still, making sure you get a C+ on that history test seems like a pretty sweet deal for thousands of dollars in tuition every year. (It’s even sweeter if you can combine the deal with Pell Grant dollars, which are totally need-based.) I can sympathize with our president’s concern. There have been countless news articles about the lack of skilled workforce
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“You appreciate something more when you work for it yourself. And that’s why I think there are some major flaws with President Obama’s proposal to offer free community college to any interested students.” in the country. And “skilled trades” like welders and plumbers are even more lacking. So on the face of things, it makes great sense to encourage our youth to head to community colleges to learn useful trades—especially when a plumber can snatch up a $30,000/year job right after graduation, while English majors and history majors might struggle for months in a stagnant job market. I’m all for encouraging people to check out “alternative” educational paths—but the president’s plan isn’t the best way to do it. For one, it’s costly. We all know that “free” isn’t really “free.” Someone’s going to be paying for this. While the president divides the funding between federal and state levels, in the end it’s still regular taxpayers who are going to be footing the $60 billion bill. With a country that’s already $18 trillion in debt, do we really want to add another $6 billion every year? For another, this isn’t the federal government’s area of concern. Besides the fact that the tenth amendment of the U.S. Constitution hands power over to the states unless it’s specifically given to the federal government, all-encompassing government-run programs rarely work out. From Social Security to Medicare, nation-wide entitlement programs end up billions (if not trillions) of dollars over budget. While a statewide initiative offering free community college tuition, such as the initiative started by Tennessee Governor Bill Haslam, might work, a countrywide effort is too big to function. There are too many variables across state lines. One other thing to consider is how much community colleges might inflate their prices if they know the government will cover the tuition. Remember how housing prices skyrocketed once huge loans became available to anyone, regardless of their risk
factor? Even traditional four-year colleges have inflated their costs 27 percent beyond inflation over the past five years, thanks in part to the fact that federal loans make tuition money readily available. It’s easy to charge exorbitant prices if you know someone will pay them. But I think the biggest reason this plan is doomed to fail is because people don’t value what they don’t have to work for. When I attended my four-year college, I worked my way through thanks to six jobs (not counting the summer jobs) and several scholarships—and I worked hard. I wanted to make the most of the credits I was paying for. But if you’re handed credits on a silver platter, will you even care? When it comes to community college students now, only 25 percent who don’t transfer to 4-year colleges graduate. Of the students who do transfer to four-year colleges, only 40 percent graduate within six years of enrolling. Do we really think the numbers will improve if we make it a free-for-all where there are no financial ramifications for dropping out? My guess is people will treat their free credits like I treated my parent’s Buick— and this time, it’ll be us taxpayers stuck with a $60 billion repair bill.
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Sleepy Eye
Mankato
Kurk Kramer, Sleepy Eye EDA
Jonathan Zierdt, Greater Mankato Growth
The EDA continues its “Business Retention & Expansion” surveys with local businesses. Contact continues with the consultant for GE Capital on selling the hotel. There will be a sale on that property on March 5 at the Brown County Courthouse. The Orchard Inn has a new owner and is open evenings from 5-9 p.m. for dinner. The EDA’s 2015 goals are to complete the BR & E program, address the Housing Study results, continue to work on Snow Addition businesses, and begin studying a professional childcare facility.
Thank you to our more than 900 members for making the past year a record year for the organization! Greater Mankato Growth, Visit Mankato and City Center Partnership will celebrate the accomplishments of 2014 as well as share our goals for 2015 at the Greater Mankato Growth, Inc. Annual Meeting on March 12. For more information about this member-only event, and to register for a ticket or table, visit greatermankato.com/annual-meeting.
Blue Earth Cindy Lyon, Blue Earth Chamber/CVB The Chamber of Commerce and Convention & Visitors Bureau are gearing up for another GIANT 2015! We are happy to welcome 12 new 2015 Chamber Members. We are pairing up with Blue Earth Community Foundation & SMIF for a giant fundraising expedition raising money for our new Giant Building, which will be placed at the foot of our Green Giant Statue in beautiful Blue Earth. Follow us on Facebook or our website at www.blueearthchamber.com.
Gaylord Amy Newsom, Gaylord EDA The Gaylord EDA is excited to announce a new Sign and Awning Forgivable Loan Program. This program is intended to provide commercial property owners with a resource and incentive to add, improve and/or replace signage & awnings in the downtown area. Loans range in size from $500 to $2,000. Loans will be in the form of a 0 percent interest 3-year deferred loan. The loan policy and application can be found at www.exploregaylord.org.
Lake Crystal Julie Reed, Lake Crystal Chamber Ladies Night Out is coming to Lake Crystal. Join your girlfriends and the Lake Crystal Area Rec Center at the Lake’s Sports Bar and Grill from 6-10 p.m. on March 27. This free event showcases several businesses showing off the newest items for women, including purses, makeup, clothing, candles, jewelry, home décor and more! 38
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The evening will include drink and appetizer deals. Come treat yourself to a night of pampering and fun!
Mankato Kathryn Reeder, Visit Mankato The sixth annual Mankato Marathon, presented by Mayo Clinic Health System, will be Oct. 17 and 18. The goal is to have 5,000 runners participate. Many sponsorship opportunities exist for businesses, which can also have a vendor or product placement presence at the Sport & Health Expo. Corporate discounts are offered to employees who sign up in groups of 10 or more to run. For more information, visit mankatomarathon.com or call Visit Mankato at 507-385-6660.
Mankato Nicole Griensewic Mickelson, Dev. Commission Region Nine is hosting a Grant Opportunity Forum from 8:30 a.m.-12 p.m. on March 26. The forum will feature presenters from the Mardag Foundation, Medica Foundation, Prairie Lakes Regional Art Council and more. This free event will be held at the South Central Service Cooperative in North Mankato. Reserve your seat today by visiting www.rndc.org/2015SpringGOF or call (507) 389-8885.
Mankato Julie Nelson, Small Business Development Center Starting or growing a business takes money, and it can be difficult for business owners to know where to begin. The Small Business Development Center at Minnesota State University helps businesses
Local Chamber & Economic Development News
identify and access all types of capital, including SBA loans, private bank loans, microloans and local gap funding. Our consultants have in-depth knowledge about loan programs and the documentation that lenders require. Call the SBDC at 507-389-8875 or apply for services at myminnesotabusiness.com.
Nicollet Alesia Slater, Nicollet Chamber of Commerce Happy New Year! We are just finishing up our membership drive, with about 75 percent of our memberships turned in. 2015 will be an exciting year for the community of Nicollet as the construction of the Hwy 14 interchange begins in July. You can follow the project at nicollet.org. Upcoming events include Nicollet City wide garage sales on April 24 and 25, and Nicollet Clean Up Day May 2. Follow all of our events at nicollet.org
Sleepy Eye Trista Barka, Sleepy Eye Area Chamber The Chamber held its Annual Meeting on Feb. 4, filled with fun and friends. We honored the 2014 Big Chief–Mayor Jim Broich, 2014 Extraordinary Volunteer–Sleepy Eye Fire Department and 2014 Shining Star–Jill Berdan of SouthPoint Federal Credit Union. The 2015 Miss Sleepy Eye coronation will be held March 21 and the three ladies who are crowned with represent Sleepy Eye at area parades and Chamber events.
Springfield Marlys Vanderwerf, Springfield Chamber/CVB Springfield EDA and Brown County Economic Development Partners will host a Springfield Area Job/Career Fair on April 7 from 2-6 p.m. at the Springfield Area Community Center. Participation as a Gold sponsor ($150) includes promotional and advertising materials and a table at the fair. Otherwise, tables are available for $50 before March 10 or $65 afterwards. Register with Matt Skaret at 2 E. Central Street, Springfield or call 507-723-3500.
Waseca Colleen Carlson, Waseca Tourism Mark your calendar today for a day in beautiful Waseca! Enjoy the friendly charm of specialty shops, deliciousness of retro diners, cozy coffee shops, or a classic drive-in. Let the kids splash at the waterpark, fish, boat, picnic, hike and ride the bike trails. Check the www.discoverwaseca.com community calendar for spring events at the Waseca Art Center, Farmamerica, Waseca County Historical Society and Waseca Waterpark. It’s just a peek at what to do in Waseca!
Waseca Kim Foels, Waseca Area Chamber The Waseca Area Chamber of Commerce and Agri-Business committee will host the annual Farm and City Luncheon on at 11:15 p.m. on March 19 at the American Legion. Awards include the 2014 Waseca County Outstanding Young Farmer, Waseca County Distinguished Agricultural Award for Senior Active & Posthumous, and 2014 Waseca County Farm Family of the Year. The keynote speaker this year is Teresa Spaeth, executive director of the Agricultural Utilization Research Institute. Check out www. discoverwaseca.com/chamber.
Waseca Kimberly Johnson, City of Waseca Waseca recently updated its Revolving Loan Funds (RLF) to be more accessible. The Small & Emerging Business RLF is now available Waseca County-wide and, along with the Jobs RLF, has relaxed terms for businesses seeking gap financing. Downtown Commercial Rehabilitation and the Single-family Rehabilitation RLFs are recapitalized to provide for more commercial and housing projects. Contact Kimberly Johnson at kimj@ci.waseca.mn.us or 507-835-9741. City of Waseca and Waseca EDA are equal opportunity providers.
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By Carlienne A. Frisch Photo by Kris Kathmann
Jeff Traxler glanced out of the lodge window and his eyes lit up as he saw two young hunters posing with their grandfather outside of the Club House. “Families frequently pose for pictures,” he said, “several generations, each person holding a pheasant.” Over the past 27 years, Traxler’s Hunting Preserve, located about two miles east of Le Center, has become a million-dollar, multi-faceted business. From mid-August through mid-April, 325 hunters who pay $525 annual membership dues can bring their families and their guests to 800 acres of rolling hills, woods, lakes, sloughs, natural grasses and brush. (An annual corporate membership for four people costs $1900.) Visitors can pay a daily fee and have a trial hunt while deciding whether to sign up for membership. Many hunters bring their bird dogs, with the aim of shooting pheasants, mallards, and Hungarian and chukar partridge. This season, the Traxlers have ordered 1,000 to 2,000 birds a week from the Oakwood Game Farm in Princeton, adding up to 30,000 birds in all. continued >
Starting with a cattle shed and 1,000 pheasant chicks, a Le Center native created an 800-acre hunting preserve that goes through 30,000 birds every year.
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For The Birds
ing was unforgettable. He tells it thus: “I went to a friend’s Halloween party in Chanhassen, dressed in my Army fatigues and beret. I had on face paint and was carrying my M-16 rifle. At the party, I ran across this gorgeous blonde, but she wouldn’t even sit by me. She did take my phone number and gave me hers. I called her to come down for a date and a meal. Once she came in, we had a good conversation. I married her nine months later. She has grounded me. She’s more of the business person, and she helped me settle into the business.” Kathy interjected, “I live the adventure of keeping my husband grounded and organized.”
“Times were kind of tough, so I decided I either was going to have a hunting preserve or trap and sell minnows for bait,” he said. “I didn’t have a business background, just hard work and common sense.” The game preserve might have been a bait shop if Traxler had made a different decision back in 1987, when he realized he was tired of the daily grind. At the time, he was working at his family’s company, Traxler Construction, running backhoes and bulldozers while also serving in the Army Reserves. “Times were kind of tough, so I decided I either was going to have a hunting preserve or trap and sell minnows for bait,” he said. “I didn’t have a business background, just hard work and common sense. I wasn’t a good high school student, and college was not my thing. Some people laughed when I started the hunting preserve, but my grandma loaned me $5,000 at seven percent. She forgave me the interest when I married Kathy three years later.” Traxler started out buying 1,000 pheasant chicks and using a tin shed on his family farm that used to hold cattle and pigs. Some friends helped him fix it up and put a bar inside. Whenever he didn’t have a hunt booked, he worked other jobs; one year, he juggled six jobs in addition to the time spent at the preserve. Along the way, he met his wife Kathy, who is in many ways his opposite, offering a good complement as his business partner. Their partnership seems to have been fated, perhaps because their first meet42
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In 1994, Traxler’s father said their business was growing too big for their location, so he sold them 20 acres and they built the current preserve. “We were scared to death,” Traxler said. But the move paid off: those first two rooms have expanded to five in the lodge, and the Traxlers also built a two-unit cabin and bought a house on the neighboring farm. Now they’re able to accommodate 20 people in the Bird Lodge and the Bunk House. “Customers reserve a field, indicating how many birds they want to hunt,” Traxler explained. “The birds are kept in flight pens, covered by nets. When the customer wants to shoot 10 birds, we put the 10 birds into a field of 10 to 40 acres. Some hunters get all 10 birds. Other times, some birds stay in the field, so the next hunter might get 15 birds.” The preserve also offers a 50-bird sporting clay course, a trap range and clay shooting. The Traxlers rent out pointers and flushers, including Labradors, German Shorthair Pointers and Springer Spaniels, at $40 per hunt. “Our dogs are booked out well in advance,” Kathy said. “We get some in as started dogs and some as puppies. We do some basic training ourselves, and then the dogs are sent out for additional advanced training. Most dogs need experience to be a good hunter, and our dogs get plenty of that here. Our dogs hunt with anyone.” You might say Traxler’s decision to have a hunting preserve is a result of his DNA. His 78-year-old father, Dale Traxler, recently brought home a musk ox he shot in Greenland. “My father is a huge hunter,” Traxler said. “Over the years he has shot everything but me--and I still sleep with one eye open.” But the Traxlers have trophies of their own, which can be seen in wall displays decorating the various rooms of the lodge: antelopes, deer, a jaguar, a rhino... There’s even an elephant, which Kathy helped her father-in-law take down during a trip to Zimbabwe—their second hunting trip together to Africa. She also shot zebras and impala while she was there. Her affinity for firearms began long before her marriage. “I shot handguns in my teens as a hobby,” she explained. “When Jeff and I got engaged, he bought me a shotgun. That’s when I started hunting. If you can’t beat ’em, join ’em.” As for Traxler, he said he prefers to hunt in North America, and he’s collected some impressive trophies himself: bears, moose, even an alligator. But at this point, he said he actually spends more time fishing. (Don’t be fooled into thinking he took the boring route—there’s a 450-lb shark mounted on one of his walls that will tell you differently.)
Traxler’s Hunting Preserve | Le Center
For The Birds
A Love Of History In addition to hunting, Traxler has a passion for history—especially World War II. He has made a pilgrimage to the beaches and cemeteries of Normandy, France, and he uses one of the walls in the lodge to showcase WWII weapons from the United States, Japan and Germany. He took his love of history a step farther in 2008, when he began organizing “Military History” events at the preserve. For three years in a row, once a year, the preserve offered large-scale military reenactments of battles, ranging from the Civil War all the way to present day. The reenactments included real WWII tanks and fighter planes, live cannon firing, appearances from current military forces as well as veterans, and scripted public battle segments. However, after terrible weather ruined the event two years in a row, Traxler decided to stop organizing it. But that didn’t mean he gave up on the concept. Instead, he turned to the big screen. Working with friend and fellow veteran Kyle O’Malley, he launched a four-year project to create a war film, which eventually became the 2011 film, “Memorial Day.” The two of them managed to raise $1,000,000 to finance the project, and Traxler wrote the story, which was about a grandfather telling his grandson stories about his time overseas. He also ended up producing it. The battle scenes were filmed at the preserve, while other scenes were shot in Mankato and other Minnesota locations. They used real WWII war planes and equipment from the 34th Red Bull Infantry Division, which helped ensure the film’s authenticity. While the movie didn’t receive a theater release, it did win the GI Film Festival for best story, and hundreds of thousands of copies have been sold. In addition, the CW Channel bought it to play every year on Memorial Day. “It was one of our crazier ideas,” he said. “I said, ‘Let’s all go on an adventure and see what we can do with this.’ But it was amazing. It’s a great American story, and it was well worth what we did.”
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For The Birds
But at this point, he said he actually spends more time fishing. (Don’t be fooled into thinking he took the boring route—there’s a 450-lb shark mounted on one of his walls that will tell you differently.) A typical day on the preserve can see more than a dozen different hunting parties come to shoot. Sometimes, parties will stay over at the cabin, hiking as well as hunting, but most parties only come for a half-day shoot. And while traditional hunting parties may have been dominated by men, Kathy said more women are starting to participate, as well as whole families. “A hunting preserve is a family activity,” she said. “People can
bring their kids, age 12 and above, to hunt. They must have passed the state firearms safety test. Younger children can walk along.” Hunting parties can also eat at the Club House, which started because the Traxlers enjoyed entertaining. At first, they served pizza, then branched out to burgers. About 15 years ago, they expanded their menu even more by offering wild game dishes, which are only offered twice a month, every other Thursday night. The regular menu, though, is open to the public from 10 a.m. to 2 p.m. every day except Tuesday. Liquor is served to hunting groups only after
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Traxler’s Hunting Preserve | Le Center
For The Birds
Background Check Favorite school subject: He: History. She: Math. Most disliked class: He: Math. That’s why God made calculators. She: History. First jobs: He: I farmed with my family, worked in the family construction business and served in the U.S. Army Reserves. She: I learned customer service working as a waitress and in retail sales when I was a teenager. After four years of business education, I worked for Pillsbury in special commodities and the accounting area. Hobbies: He: I hunt for a living and fish for fun, from the oceans to locally. She: I’m a runner and have run the Chicago Marathon. I have done the three-day, 60-mile Breast Cancer Walk, and I’m training with our daughter Megan for Grandma’s Half Marathon in Duluth. I also like cooking, photography and scrapbooking the photos. Accomplishment of which most proud: Both: My family. Most valued intangible: He: The making of the movie “Memorial Day.” She: “My health.” Words that describe Jeff: Kathy’s answer: Trustworthy, a leader, fun-loving.
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Words that describe Kathy: Jeff ’s answer: Dependable, driven, a mama bear. If you didn’t have this business? She: I’d probably do something in the hospitality or entertainment industries. He: I don’t even want to think about it.
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For The Birds
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they have completed their shoot. The daily specials range from the mundanely elegant, such as prime rib, to the more imaginative, such as elk cheeseburgers topped with venison bacon, served with a side dish of elk chili. Other memorable specialties for wild game dining nights are goose breast, walleye mac and cheese, quail with cranberry wild rice stuffing and orange-roasted wild mallard. In the exotic realm are alligator gar cakes and blacktip shark. “We used to be a hunting preserve with a restaurant, and now I sometimes feel like a restaurant with a hunting preserve,” Traxler said. However, he added that there are advantages to having a two-fold business. “Having the game preserve is weatherrelated, like being farmers,” he said. “Long, cold winters are not good for hunting, but the restaurant makes up for that somewhat. Every day is a bit different.” Like many entrepreneurs, the Traxlers seldom separate their professional and personal lives. Their home is just down the road, on the farm where Traxler grew up. Kathy explained, “Working as a couple, running a business is an amazing experience. We’re out here seven days a week, but come and go as business and family obligations require. During the busy season, we could be here for a 14-hour day, so Jeff takes a nap every afternoon to reboot. When our children were babies, I brought them to work. I’ve been full-time for the past 20 years. The most interesting part of my workday is planning events.”
The events include fundraisers for causes such as the Wounded Warrior. A recent event to raise funds for cancer research involved 88 participants, 12 corporate sponsors, 80 auctions and raffles, and 10 Minnesota Vikings football players. More than $85,000 was raised. “When the Vikings players and coaches come here, we don’t talk about football; we talk about hunting,” Traxler said. “We’re all about hunting. We’ve had some amazing events.” The four Traxler children have all been involved in the family business, although the oldest now works in the movie industry in Los Angeles. Samuel, a student at Minnesota State University, Mankato, works outdoors on weekends, along with 24 other employees who catch, plant, clean and care for the birds. As school schedules permit, Megan, a student at the University of Minnesota-Duluth, and Mary, a high school student, work in the lodge. They take bookings, shoot photos of hunters holding their game, assist in the kitchen and deliver a plate of shark or an elk burger to a hungry customer. There also are other staff members, without whom Traxler said he could not operate. “I hired a general manager to be my boss,” he said, “and two men as outdoor managers of 15-18 boys. In a farming community, you know the kids. We hire young staff because they want to work. We give them responsibility, and they take the bull by the horns and run with it. ” Kathy added, “We’ve had many young people work for us, both inside and out-
For The Birds Andrew Tatge • MN Super Lawyer Rising Star atatge@gislason.com
Community Involvement • Le Center Area Chamber of Commerce
Kaitlin Pals kpals@gislason.com
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• Le Center American Legion Post 108 • Minnesota Game Breeders Association • National Association of Game Breeders
Traxler’s Hunting Preserve | Le Center
doors. They learn to talk with people and to make customers feel like family. We get compliments on our staff. We’re familyfriendly, clean, and have repeat business, unless the hunter moves away. This year we’ve seen the biggest upswing in new business in a long time.” In addition to word-of-mouth promotion from satisfied customers, the Traxlers have used posters in advancing their business. In fact, in the early days, the posters provided a real boost to the business, which is easy to understand when you look at them: young, pretty ladies bearing arms and baring midriffs. Kathy said the models were friends and family, adding that more than 6,000 posters have been circulated. “People don’t take them down,” she said. “They leave them up in fish houses and man caves. One of our posters even was in the movie ‘Fargo.’” The wholesome models wear apparel that sports the Traxler logo, available on coats, shirts, vests and caps in the pro shop. The
clothing carries the message far and wide. Traxler said he saw a fellow passenger wearing a cami print cap with the Traxler logo on it during an Amsterdam-to-Milan flight. While the preserve has grown and changed over the years, Traxler says the reason for their success has always been the same. “When we started this business,” he said, “we had little knowledge about what we were doing. We learned from our mistakes, and we’re still learning. We gave this business to God long ago. We just work for Him.” Kathy agreed. “We couldn’t do this without the Lord in our life. We pray for our staff and our hunters’ safety, and we tell them we’re doing that. We’ve never had an earthshaking occurrence, just small things, like people getting their fingers caught in the action of the gun.” As for the future, Traxler says it’s both hopeful and exciting. “There are quite a few hunting preserves in the state, but most of our members continue year after year,” he said. “As long
THE ESSENTIALS
Traxler’s Hunting Preserve Address: 37699 Hunting Preserve Lane Le Center, Minnesota Phone: 507-357-6940 Web: traxlers.com memorialdayfilm.com Facebook: Traxler’s Hunting Preserve
as there is a Cabela’s, a Gander Mountain, a Scheels, a Fleet Farm, people will need places like this to hunt on. It’s hard now, with land prices, for people to start a game preserve. We’ve worked for 27 years to build this up. We like to give people the experiences we’ve enjoyed–food and hunting. We’re going to continue improving, but not expanding…. But I never say, ‘never.’” Carlienne A. Frisch writes from Mankato.
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HOT STARTZ!
Very New or Re-formed Businesses or Professionals New To Our Reading Area
Northern Energy Homes Melissa Orthun and her brother Michael Stenzel know something about houses. Their grandfather, Walter, and his brother, Charlie, were prominent home builders in the Mankato area from the 1960s to 1980s, and their father Mark Stenzel started Northern Energy Homes, Inc., based in Wells, in 1986. While Mark Stenzel has pretty much retired, Orthun said, his wife Mardel still works here, along with Orthun and her brother Michael. “It’s been our heritage for a long time,” said Orthun, who acts as the business office manager. Michael Stenzel has worked at Northern Energy Homes for 11 years, but Orthun joined the business in 2014, after working nine years in the automotive industry. She said she needed a change—and now she loves her job so much, there’s no going back. In September, the siblings moved the location of their business to Mankato, branching out from a small basement office to a renovated auto repair shop that now features a showroom with private offices, two custom kitchens, a custom fireplace and a custom tile bathroom. Orthun said that the decision to move locations came about because most of their housing orders were coming from the Mankato area, so they wanted to be closer to their customers. And thanks to the new showroom, customers are also able to better examine what the business offers.
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According to Orthun, Northern Energy Homes helps customers line up everything from a house design to finding the right lot to installing kitchen cabinets. While they work with subcontractors, they still walk customers through every stage of the project. “We take all of our customers to every place, to look at the flooring, the windows, etc.,” she said. “Everything is very hands-on. All you have to do is come to us, and we’ll take care of everything from there. We’re a one-stop-shop.” NORTHERN ENERGY HOMES Address: 1750 Bassett Drive Telephone: 507-345-5554 Web: northernenergyhomes.com Email: info@northernenergyhomes.com
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MANKATO
Aurora Chiropractic
ART SIDNER
Jennifer Stuvek always knew she wanted to be a doctor, but it was her first job at the Fairbanks Chiropractic Clinic that led her into the field of chiropractic. “I really love helping people achieve a higher quality of life, and being a chiropractor lets me do that every single day,” she said. Stuvek grew up in Fairbanks, Alaska and started working at the clinic when she was 15. She began as an administrative assistant and worked her way up into billing and accounting. Once she graduated high school, she earned a bachelor’s degree in Biological Sciences from the University of AlaskaFairbanks. Then she made the trek to Minnesota to study chiropractic care at Northwestern Health Sciences University, where she graduated in 2012. Along the way, she met her fiancé (now husband), and the two of them decided to move back to Alaska so she could practice at her old clinic. They stayed in Fairbanks for two years, but they planned to move back to the Midwest, where they both have some family, so she could open her own practice. “We wanted to find a community that we could be in for a long time,” she explained. “[Mankato] was the size of community we wanted, and we’re so excited that we can see this as being our forever-place.” Stuvek opened her clinic, Aurora Chiropractic, in Janu-
ary and says business has been steady so far. She offers a range of services, seeing every type of patient: students, babies, pregnant women, the elderly and more. Besides offering services such as spinal adjustments, she also offers education and lifestyle advice that patients can use in their day-to-day lives. “I want them to get to a place where they don’t need me as much,” she said. “Then I think I’ve done my job well.” AURORA CHIROPRACTIC Address: 1051 Madison Avenue, Suite 2 Telephone: 507-625-1085 Facebook: Aurora Chiropractic, LLC Email: info@aurorachiropractic.com
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HOT STARTZ!
Very New or Re-formed Businesses or Professionals New To Our Reading Area
Creative Coop When Rob Lawson decided to start his own business, he discovered that one of the trickiest parts was finding affordable office space. With office rentals often running $1,000 or more, Lawson said he was lucky to stumble onto his current space thanks to an ad he found on Craigslist. The ad explained that one company, Envision Design That Works, Inc., was looking for a sublease to share its office space, located in a loft at the top of the Schaefer building in St. Peter. The owner was willing to split the monthly rent between the two of them. “I took a look at the place and said it was great,” Lawson said. He moved into the building in April 2011, joining fellow businessman Doug Kvidera, who’s a software developer. They were shortly joined by Michael Schwertfeger, who owns Lime Rock Photography, and the four businesses decided to form a co-op to offer other business owners cheap, appealing work space. “There are a lot of businesses like us that could never afford a retail location with a long-term lease,” Lawson explained. “But as a cooperative with likeminded individuals, they can.” The office rent, which includes all utilities, is $1,000 a month, split across all members. Since Envision has moved out, the three business owners are paying about $330 each right now.
If another member joined, the rent would drop to $250 each. Lawson said the space can fit one or two more businesses. Rent includes access to a conference room as well as built-in wooden cubicles. All members participate and vote in the co-op’s meetings. “We’re just a bunch of guys that want a place to work comfortably and share ideas,” he said. “We don’t make a profit from it. We’re just trying to help each other out, and have a place where people can enjoy working.” CREATIVE COOP Address: 322 South Minnesota Avenue Telephone: 612-460-5851 Email: robdusa@gmail.com
To be considered for one of three spots in the May Hot Startz!, email the editor at editor@connectbiz.com. Businesses considered must have started—or changed greatly in form—within one year of our publishing date. Professionals chosen must be new to our reading area.
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Submitted by Lime Rock Photography
ST. PETER
PRESS RELEASES
To submit a press release for publication:
Email: editor@connectbiz.com Fax: 507-232-3373
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Fairmont From the Chamber: new members include Fairmont Lawn & Landscaping, Inc., Bryan Luster, Partners Funding, Inc., and Learning Journey, Inc. FAIRMONT
Sweet Financial Bryan Sweet and his team at Sweet Financial Services have been named the No. 1 Raymond James Financial Services office in Minnesota, and he was also named to the Chairman’s Council. This is the 11th time Sweet has been named on the list.
Gaylord From the Chamber: Jalisco Market, a new indoor Hispanic market, opened in downtown Gaylord.
Lake Crystal From TBEI: Steve Lee was promoted to Engineering and Quality Manager. From MinnStar Bank N.A.: Ryan McCabe has been promoted to assistant vice president/credit analyst and Linda Ried has been promoted to vice president/loan officer. McCabe has been at MinnStar for more than a year, while Reid has worked at the bank for more than 25 years.
Le Sueur This year’s Retail & Business Expo will be held in the Valleygreen Square Mall on March 26. The expo will include Twin Cities Life Style Expert Ross Sveback
from the Fox9 morning show and is sponsored by the Le Sueur Chamber of Commerce. The annual city-wide garage sale will be on April 25, starting at 8 a.m.
Madelia From the Chamber: new members include Philip and Rosemary Murphy. The Madelia Community Hospital & Clinic received two plaques in January for its commitment to patient safety. One plaque acknowledges the facility’s dedication to enhancing patient safety through the Partners for Patients initiative, while the other acknowledges the hospital’s successful completion of the “On the CUSP: Stop CAUTI Project,” which aims to reduce the rate of catheterassociated urinary tract infections in U.S. hospitals.
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Mankato From Greater Mankato Area Growth: new members include Mills Fleet Farm, B & B Krohn Farms, BK DJ, Pantheon Computer Systems, Nifty Home Products and J-C Press. Zonta Club of Mankato is hosting “Walk a Mile in Her Shoes,” its International Men’s March, in April to stop sexual assault and gender violence. Proceeds will go to the Committee Against Domestic Abuse. Trong Ho joined Weichert Realtors as a new real estate agent. Explore Minnesota has included Minneopa Falls for the second time in its statewide scavenger hunt, which runs through March 5. In January, the Martin Luther King, Jr. Commemorative Board awarded the 2015 Business Pathfinder Award to Imperial Plastics for its commitment to employee refugees. Eide Bailly LLP has hired four new
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PRESS RELEASES
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employees as well as bringing in several student interns. The new employees are Derek Golberg, Clarissa Meissner, Jordan Hoppe and Sara Ptacek, and the new interns include Alyssa Claflin, Audrey Schmidtke, Dexter Wermers, Elizabeth Luepke, Jerad Michels, Kalee Fuller, Karlee Strack, Nate Kelly and Rebecca Hintz. Habitat for Humanity of South Central recently partnered with Salvage Sisters to create a dream bedroom for twin sixyear-old girls. The home dedication was in mid-January. The nonprofit organization also received $120,000 from Thrivent Financial to support the Thrivent Builds with Habitat for Humanity Program, an ongoing, multi-year partnership between Habitat for Humanity International and Thrivent Financial. Habitat for Humanity needs sponsors and volunteers for its spring “Home Tweet Home” fundraiser, a March event that includes a silent auction featuring handpainted birdhouses. Tickets for the event are available for $20 by calling 508-388-2081. Joel Eckberg recently partnered with
Morken, Morken & Co., Chtd, which will now be known as Morken, Eckberg & Co., Chtd. Eckberg has a bachelor of science degree in accounting from North Dakota State University and is an active Certified Public Account with more than seven years of public accounting experience. Southern Minnesota Nurses (SMN) is hosting a Bowl-A-Thon on March 2 to raise funds for VINE Faith in Action and the SMN Nursing Scholarship fund. SMN is asking for organizations and individuals to sponsor teams or join the event. Profinium Insurance recently hired Mark Lancaster to serve as the agency’s Mankato president. Lancaster has more than 15 years of experience in financial services. Mayo Clinic Health System in Mankato recently became the first urgent care facility in Minnesota to receive the Urgent Care
MANKATO
Kato Roofing Kato Roofing, Inc. has received national certification as a Women’s Business Enterprise by the Women’s Business Enterprise National Council. To be certified, a business must be at least 51 percent owned, operated and controlled by a woman or women. Kato Roofing is the only roofing contractor in Minnesota certified by the WBENC.
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Association of America’s (UCAOA) Certified Urgent Care designation. UCAOA certification indicates that Mayo Clinic Health System in Mankato Urgent Care meets or exceeds extensive certification criteria and provides top tier health care to its patients. From the Greater Mankato Rotary Club: The 2015 Service above Self Awards have been chosen. Individual winners include Kate Cox and Howard Vetter, while group awards include Mustache Bash and Grow Mankato. From Regional Nine Development Commission: Nicole Griensewic Mickelson has been appointed the treasurer of the Greater Minnesota Partnership’s Board of Directors. Griensewic Mickelson currently serves as executive director for Region Nine. Connect Real Estate Group recently opened in Mankato as a real estate company that specializes in connecting buyers and sellers for residential and commercial real estate in southern Minnesota, as well as providing property management services. Connect Real Estate’s owner/broker is Christa Wolner, and its three agents are Chris Cousins, Michael White and Kellie Krumwiede.
North Mankato Since 2009, South Central College has offered a Mechatronic Engineering Technology program at its North Mankato campus. Now, the college is offering its course for students and businesses across the country through its “iMEC” online
classes, which offer mechatronics lab kits and access to the college’s remote education automation lab. In addition, a team of South Central College students was named Global Winners of the DECA Idea Challenge 2014, beating out 1,700 other teams from several countries. Competing teams were tasked with coming up with an invention related to a particular item and pitching it in a video. Prayy, Kutzke & Associates LLP analyst Mike Mallak has become a Certified Financial Planner after meeting the requirements listed by the Certified Financial Planner Board of Standards. Amber Pietan Travel Agency agent Sara Pietan-Raygor was ranked 13 out of 3,000 independent agents nationwide from Outside Agents.
New Ulm The New Ulm Medical Center received two grants to support innovations in health care. Minnesota Accountable Communities for Health gave the center $366,312 while the South Country Health Alliance donated $275,000. The New Ulm Medical Center also gained national recognition when its “Hearts Beat Back: The Heart of New Ulm Project” was called one of the country’s most successful collaborative health partnerships in a University of Kentucky study. The project focuses on reducing heart attacks in New Ulm. From Blethen, Gage & Krause: attorney Kevin Velasquez was selected by the Greater Mankato Growth Young Professionals as
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PRESS RELEASES
2014 Young Professional of the Year. New Ulm resident Jayne Jensen recently created a new company, Your Organized Home, to help people reduce clutter in their homes. Century 21 Koeckeritz Realty has hired Kelsey Sabatino as its newest agent. In February, the Children’s Heart Foundation received a $5,000 donation from Lasting Imprint, a local nonprofit dedicated to fighting congenital heart defects.
Nicollet Kristofer Kathmann, Jonathan Smith and Becky Wagner are new owners of Concept & Design Inc. Grace Webb is new editor of Connect Business Magazine.
Sleepy Eye New EDA members include Mike Schmid.
Springfield From the Chamber: new members include New Life Assembly Church, Shear Performance, Brown County
Habitat for Humanity, First Choice Pregnancy, Andy’s Bike Shop, State Farm Insurance and Superior Transportation Service Inc. Ben Luense was recently awarded the Spirit of Springfield Award. In addition, the Chamber’s annual meeting will be March 23 at the Community Center. Guest speaker will be Sarah Rotering, executive director for Habitat for Humanity.
ment Network initiative. First National Bank Minnesota has appointed Ben Gossett as its assistant vice president. Gossett earned his college degree in finance from Minnesota State University Mankato and joined First National Bank Minnesota in 2010.
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Greener World Solutions has announced the expansion of its spray foam insulation division. The company recently purchased enough equipment to increase their insulation capabilities by 25% after winning a bid for a project in Belize. The Waseca Area Chamber of Commerce recognized several winners during its Community Awards event in January: the Rotary Service Above Shelf award went to Jon O’Neil; the James J. Donahue Community Development went to Waseca Historic Preservation Center; the Waseca County Distinguished Agricultural Leadership award went to Doug Leet; the Boss of the Year award went to LeAnn Dahle; the Exchange Club Book of Golden Deeds award went to Dave Dunn; and the Distinguished Service award went to Jeremiah Miller. Danny Len has been hired as city manager of Waseca.
From the Chamber: Katie Lohse is the new community public health supervisor of Watonwan County. Subway and Pioneer Bank share the 2015 “Business Of The Year” honors. Heather Wentzel is the new owner of the Encore Coffee Café. Pamela Steinle has joined the law firm of Sunde, Olson, Kircher and Zender. FTD has named Creative Touch Floral an “FTD Premier Florist.”
St. Peter Rivers Edge Hospital & Clinic has been recognized by the Minnesota Hospital Association for its commitment to patient safety by participating in the three-year Partnership for Patients Hospital Engage-
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NATIONAL OPINION
Does the ability to buy Toyotas hurt middle-class Americans? That is essentially the argument made by those who say say falling union membership has harmed the middle class. But it holds little water. The decline of unions has hurt unions — while benefiting most other Americans. Union membership certainly dropped sharply in the 1970s, the period when some argue things went south for the middle class. But the unions’ decline started well before that. Union density peaked during World War II and began falling significantly in the mid-1950s. Between 1954 and 1970, the proportion of workers belonging to unions fell by one-fourth. It has continued to fall ever since. No one remembers the 1950s and 1960s as challenging for the middle class. Americans of all income levels prospered then,
even as unions contracted. Union strength matters little for workers outside of unions. This should not be surprising. Unions operate as legal labor cartels. They try to control the supply of labor in an industry so they can drive up its price — wages. Union members benefit, but those costs get passed on as higher prices. The price hikes make non-union consumers poorer. They also (unsurprisingly) reduce sales. Lower sales mean fewer jobs in that industry. Unions, like all cartels, benefit their members at the cost of greater losses to the rest of society. Consider Detroit. Until the late 1970s, the United Auto Workers (UAW) made almost every car built in the United States. The union used its monopoly to force the Big Three automakers to pay highly inflated compensation. UAW members made more than many scientists. This added roughly $800 to the cost of every vehicle they built. The higher prices hurt every driver who did not belong to the UAW. They also put a new car just out of reach for some low-income families. That meant the automakers made fewer cars and hired fewer workers. Then competition arrived. Companies such as Toyota and Honda started selling vehicles in the United States, then started building their cars in the States with American workers. Non-union American workers. Their lower costs meant they could sell morereliable vehicles at lower prices. Americans voted with their wallets: Over
the next few decades, non-union automakers captured a majority of the U.S. market. Simultaneously unionized automakers shed jobs en masse. To compete, the Detroit automakers had to reduce compensation to market rates. Today fewer than 1 in 5 autoworkers belong to a union. Did this de-unionization of the auto industry hurt or help the middle class? It certainly hurt Detroit and the UAW. But e ver y dr iver benefited from less James Sherk expensive cars that lasted longer. Total employment in the auto industry grew as well — only that growth came outside Detroit. Middle-class opportunities expanded in cities such as Huntsville, Ala.; Chattanooga, Tenn.; and Canton, Miss., with transplant factories. Curtailing non-union competition would have hobbled workers in these cities. Successful labor cartels benefit their members. But their gains come at the expense of other workers and consumers. Expanding union membership would not help the middle class, and their decline has not hurt it. James Sherk is a senior policy analyst in labor economics at the Heritage Foundation.
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507.387.6031 | w w w. e id e b ai lly.com
Advisor is a Registered Representative of and offer securities through Securities America, Inc. Member FINRA and SIPC. Investment Advisory Services offered through Eide Bailly Advisors, LLC a Registered Investment Advisor. Eide Bailly Financial Services, LLC is the holding company for Eide Bailly Advisors, LLC. Eide Bailly Financial Services and its subsidiaries are not affiliated with Securities America companies. Securities America and its representatives do not provide tax or legal advice; therefore it is important to coordinate with your tax or legal advisor regarding your specific situation.
MARCH/APRIL 2015
CONNECT Business Magazine
55
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