Prairie Business April 2012

April 2012

Models of Energy Efficiency Building With Energy Savings in Mind pg. 22 Green Living Just Makes Sense pg. 26 www.prairiebizmag.com

North Dakota. Doing Business Better.

The Enchanted Highway and its larger-than-life metal art draws visitors from around the country to rural North Dakota. Now, with support from the North Dakota Department of Commerce and its Tourism Division, the Enchanted Highway Foundation is developing a hotel, bringing additional economic activity to the area.

Learn how North Dakota is doing business better at www.NDBusiness.com

CONTENTS

Volume 13 No. 4

6

From the Editor’s Desk

8

Matthew Mohr

10

Prairie News

14

Prairie People

16

Economic Development Steady growth in North Dakota’s targeted industries is key to state’s strong economy

18

Finance Customers demand green

20

Research and Technology The 21st century resurgent plains

22 26 30 38

Feature Story: If you build it...

LEED building design catching on in the region

Feature Story: Energy efficient living Energy efficiency a must in the Midwest climate

Feature Story: Making strides in efficiency

34

The Energy & Environmental Research Center in Grand Forks, N.D., is developing alternative liquid fuels for military and commercial applications.

Leading the way efficiently

Business Development

36

Brookings attracts big business

40

EERC developing alternative liquid fuel for military

South Dakota: SD Wins implemented

NDSU CNSE lab analyzing clay samples Scientists in a lab at North Dakota State University’s Center for Nanoscale Science and Engineering in Fargo, N.D., are analyzing materials that could eventually play a role as an ingredient in proppants used in oil exploration.

Next Month 42

44

46

Red River Valley: Architecture students helping community develop vision for growth Western North Dakota: Company reaps Bakken benefits, looks to the future By the Numbers

4 Prairie Business

April 2012

In May, Prairie Business will be taking an in-depth look at tourism in the region. We will discuss how states are setting themselves apart with branding, as well as see how communities are using unique ways to attract visitors. Finally, you will learn more about how tourist attractions are creating a destination.

On the air Join Prairie Business magazine editor Alan Van Ormer and host Merrill Piepkorn on Thursday, April 12, at 3 p.m. on any Prairie Public radio station to hear more about the April cover stories. To listen to Prairie Public, visit www.prairiepublic.org/radio/hear-it-now.

On the cover The Andrew E. Lee Memorial Medicine and Science Building at the University of South Dakota in Vermillion, S.D., provides the university’s School of Health Sciences and Stanford School of Medicine with high-tech research laboratories, classrooms and offices. The Leadership in Energy and Environmental Design certified facility, designed by Koch Hazard Architects in Sioux Falls, S.D., will help reduce waste, conserve energy and water, lower operating costs and increase value, reduce harmful greenhouse gas emissions and be a healthier and safer work environment for employees. (Photo courtesy of Aaron Holmberg)

UND researcher Dr. Xiaodong Zhang and students like North Dakotan Kate Overmoe-Kenninger (inset photo with Zhang), who is pursuing her doctorate from UND, are studying the hydrology of the Devils Lake basin.

C

an an oceanographer in the middle of the North American continent find happiness studying a flooding freshwater lake in landlocked North Dakota?

“Yes,” says Dr. Xiaodong Zhang, an associate professor in earth systems science and policy at the University of North Dakota.

While Zhang continues to study oceans, these days much of his work focuses on the expansion of Devils Lake 90 miles west of Grand Forks and the seemingly intractable problems it’s created. The lake has risen nearly 32 feet since 1993, increasing in volume by seven times and in area by nearly five times (261 square miles). It has inundated prime farmland, forced towns to relocate, and required government to spend more than $1 billion on flood mitigation projects.

“When I looked at doing research,” Zhang said, “I found that much of the

current research lacks a rigorous study of the hydrological properties of not only the lake, but also of the entire Devils Lake Basin.

“We developed a hydrological model to study the rainfall and the runoff of the entire basin, instead of just the lake itself,” he explained. “We combined that model with NASA data and future climate predictions to see what the future looks like for Devils Lake. If the lake is still rising, how high will it go?”

While Devils Lake is considered a freshwater body, its water is relatively salty because it’s a terminal lake, which means that water flowing into the lake normally has no natural outlet. Evaporation causes the salts to concentrate, which makes the lake more saline than water in the surrounding environment.

“The salinity level is quite stable and doesn’t change very much,” Zhang said.

“It’s about four parts per thousand….

In comparison, ocean water is about 35 parts per thousand.”

University of North Dakota, Grand Forks, ND

1.800.CALL.UND

UND.edu

When Zhang came to UND in 2002, he wanted students in his class on hydrological cycles to understand how their lessons could be applied to everyday issues. Devils Lake was a natural fit.

In September under a NASA-funded project to monitor the lake’s water quality, Zhang and his students — such as doctoral student Kate OvermoeKenninger, who’s family spent time in the Devils Lake area — deployed a buoy that continuously measures water temperature, salinity, turbidity (cloudiness or muddiness), dissolved oxygen level and chlorophyll concentration, in addition to weather information. The buoy was placed in Stump Lake, which Devils Lake drains into.

“By monitoring water quality, we hope to have a better understanding of how it’s changing and what factors could cause that change,” he said. “We’ll better understand how the quality of water changes in response to the weather and long-term climactic changes.”

From the editor’s desk

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Business speeding up!

A recent cloud computing seminar in Fargo, N.D., pointed out one key issue: business can be done anytime, anyplace, with anyone and with any device.

Mike Jacobs, Publisher Alan Van Ormer, Editor Tina Fetsch, Production Manager Beth Bohlman, Circulation Manager Jen Braaten, Marketing Manager Joe Greenwood, Multi-Media Consultant Kris Wolff, Layout Design, Ad Design SALES DIRECTOR:

John Fetsch jfetsch@prairiebizmag.com hose were the words of Sarah Spagnol, a mid-market account manager for Google Enterprise, summing up in a nutshell what cloud computing has done for the business community.

Spagnol also discussed several business trends.

One of them involved companies working together and people all over the world are competing for jobs. Speed is important, Spagnol says, adding that businesses have to pay attention to this and get to the market faster. It is also important to note that people in the past were working alone.

Now, they are working together.

Spagnol also believes that 9 to 5 is going away mentioning that work gets done when it gets done and people are not working in the office and are able to work from anywhere.

In the news business, speed and accuracy has always been our trademark. The Internet has made that even more important.

A case in point was a recent article that appeared in the March issue of Prairie Business magazine discussing a possible merger between Eide Bailly LLP and Wipfli LLP. The day the magazine was printed the two major accounting firms decided to call off talks for the merger. Without the Internet, Prairie Business would have had to wait at least another 30 days to make our readers aware of the change. With the Internet, we were able to put this breaking news on our website immediately.

Granted, readers grab the magazine for its in-depth view of the business world, but with the Internet we are able to provide one more service for our customers – anytime, anyplace, with anyone and with any device.

And the cloud computing seminar in Fargo in February just reinforced how important that is.

T

701.212.1026 eastern ND

SALES:

Brad Boyd bboyd@prairiebizmag.com

800.641.0683 western ND/western SD

Shelly Larson 701.866.3628 slarson@prairiebizmag.com eastern ND/western MN/eastern SD EDITOR: Alan Van Ormer avanormer@prairiebizmag.com

701.371.9578

Editorial Advisors:

Dwaine Chapel, Executive Director, South Dakota State University Innovation Campus, Brookings.; Bruce Gjovig, Director, Center for Innovation; Lisa Gulland-Nelson, Communications Coordinator, Greater Fargo Moorhead EDC; Tonya Jo (T. J.) Hansen, Assistant Professor of Economics, Minnesota State University Moorhead; Dusty Johnson, Chief of Staff for South Dakota Gov. Dennis Daugaard’s office; Brekka Kramer, General Manager of Odney; Matthew Mohr, President/CEO, Dacotah Paper Company; Nancy Straw, President, West Central Initiative Prairie Business magazine is published monthly by the Grand Forks Herald and Forum Communications Company with offices at 375 2nd Avenue North, Grand Forks, ND 58203. Qualifying subscriptions are available free of charge. Back issue quantities are limited and subject to availability ($2/copy prepaid). The opinions of writers featured in Prairie Business are their own. Unsolicited manuscripts, photographs, artwork are encouraged but will not be returned without a self-addressed, stamped envelope.

Subscription requests: Free subscriptions are available online to qualified requestors at www.prairiebizmag.com.

Address corrections: Prairie Business magazine PO Box 6008 Grand Forks, ND 58206-6008 Beth Bohlman: bbohlman@prairiebizmag.com

Online: www.prairiebizmag.com 6 Prairie Business

April 2012

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7

Business Advice

Asset Utilization A benchmark used in retailing is sales per square foot.

s one would suspect, the higher the gross retail sales per square foot of space occupied the better the results a retailer has produced.

A good number to watch for in all businesses is sales per dollar of assets. Industry comparables are hard to find for many businesses, but trends over time will tell a business owner if the business is improving, deteriorating, and most importantly, if it can support the target sales level.

If, for every dollar of sales, a business normally requires 40 cents in assets, and the owner wants to double sales volume. Calculating the new target sales per asset should give good guidance concerning the need for additional investment.

An associate of mine has rapidly expanded his business over the last three decades, and as a result, moved multiple times. As with any business experiences, deciding when to move to a larger facility is a challenge. Watching product movement

A

MATTHEW D. MOHR

BUSINESS NEWS

CEO, Dacotah Paper Company mmohr@dacotahpaper.com

per square foot and per stock keeping unit (SKU) gave him solid guidance. Although he was constantly told by staff space was short, by using his benchmarks, he made better decisions on when to move, and as a result, faced little to no disruptions in his service to customers. In addition to his space needs benchmarks, he also uses inventory on hand per dollar of sales, and does very specific cash use, needs and sources forecasting.

When evaluating asset utilization numbers, use total assets (both current assets and fixed assets), so cash, accounts receivable, inventory, property, plant and equipment all need to be included.

Sophisticated analysis can include liabilities (particularly the adjustment in current liabilities as volume changes), and gross trading margin along with net cash flow when determining business needs and expected results. PB

Western North Dakota Private Aircraft Shuttle FOUNDATION AWARDED $120,000 The Otto Bremer Foundation, majority owner of Bremer Bank, awarded $120,000 to the North Dakota State College of Science Foundation. The funds will be used to update technology in the NDSCS Allied Dental Education Clinic on the Wahpeton, N.D., campus.

Through the combination of donation, grant and fundraising dollars, the NDSCS dental department will be able to upgrade dental chairs and technology, reach more of the community to provide general services, and help an increased number of underserved children at the annual Give Kids a Smile event.

8 Prairie Business

April 2012

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9

Prairie News

Press releases and photos about business news and events in North Dakota, South Dakota and western Minnesota can be e-mailed to avanormer@prairiebizmag.com for consideration

CHAMBER MIXER HIGHLIGHTS PRAIRIE CENTER A recent Chamber Mixer in Sioux Falls, S.D., allowed visitors to view the newly-constructed Prairie Center, home to Avera Cancer Institute and Avera Surgery Center.

The $93 million, five-story, 260,000-square-foot building provides a comprehensive healing environment, with virtually all cancer services provided under one roof. Programs are designed to see patients through the entire realm of cancer care from prevention and diagnosis to various treatment modes to survivorship care. The ACI is home to the latest cancer care technology, as well as the latest evidence-based protocols and cutting-edge clinical trials. The Prairie Center's interior, complete with indoor gardens, waterfalls and an extensive original art collection, is designed to inspire dignity, courage and hope.

Avera Health has facilities in 300 locations in South Dakota, North Dakota, Minnesota, Iowa and Nebraska.

Along with Sioux Falls, there are hospital locations in Mitchell, Yankton, Aberdeen and Marshall, Minn.

Julie Dixen, outpatient cancer program manager says the new facility allows the patients to become confident in the care that is being provided as soon as they enter the doors. “Our patients and support persons told us they don’t want to be treated as a number,” she says. “Rather, treat me as an individual and have a human connection. In our other facility, it wasn’t welcoming for families to be present during treatments. Families are now engaged and involved in the treatment process.”

The $93 million, five-story, 260,000-square-foot Prairie Center provides a comprehensive healing environment, with virtually all cancer services provided under one roof. (Photo by Alan Van Ormer/Prairie Business magazine)

KEYNOTE SPEAKER: NORTH DAKOTA LEADING THE WAY

Stephen Moore, lead economist for the Wall Street Journal, spoke on regaining prosperity at a recent Economic Outlook sponsored by the Fargo Moorhead West Fargo Chamber of Commerce. (Photo courtesy of Legacy Photography)

10 Prairie Business

April 2012

The lead economist for the Wall Street Journal told almost 450 people gathered at the Holiday Inn of Fargo, N.D., on Feb. 28 that the right set of policies could bring out a big boon for the economy.

“States like North Dakota are going to lead the way,” says Stephen Moore, the keynote speaker at the February Economic Outlook sponsored by the Fargo Moorhead West Fargo Chamber of Commerce.

Moore’s keynote speech focused on regaining prosperity, noting that North Dakota has become an engine of growth for the United States economy.

Also participating in the Economic Forum was Robert Benson, president and CEO of the North American Coal Corporation, who discussed the local impact of the energy industry and the economic opportunities. He stresses that the major threats to the coal industry include EPA regulations, surface mining regulations, administration policies, foreign demand and energy exports.

Peter Christianson, president and chief operating officer of Titan Machinery notes that since 2003, Titan Machinery has 94 stores operating in eight states.

Christiansen says that what has driven the strong agriculture economy is increased growth in developing crops, increased demand for biofuels and technological advances.

A third panelist, Shawn Dobberstein, executive director of Hector International Municipal Airport Authority in Fargo, N.D., says in 2010, the Fargo airport had 366,000 boardings, which is the highest ever. Recently, Fargo Air Center started providing flights to oil country.

SBA LICENSES FUND The U.S. Small Business Administration licensed the first nationally focused Impact Investment Fund, SJF Ventures III, LP. The fund will make equity investments in cleantech and technology companies in communities nationwide as part of an impact investment initiative to invest up to $1.5 billion in highgrowth small businesses.

SJF Ventures invests growth equity in companies with strong financial, community and environmental results. SJF’s areas of focus includes: efficiency and infrastructure; reuse and recycling; sustainable agriculture and food safety; and technology enhanced services. The fund is committing up to $75 million of investment capital over the next five years.

For more information on the impact investment initiative visit www.sba.gov/content/impactinvestment-initiative.

MERGER DISCUSSIONS CEASE Editor's Note: The March issue of Prairie Business Magazine contained a feature story on the possible merger of Eide Bailly LLP and Wifpli LLP. The March issue was already printed when news came that the two firms decided not to proceed with the proposed merger.

Executives of Wipfli and Eide Bailly, two prominent accounting and consulting firms that rank among the largest in the country, decided not to proceed with the proposed merger and will continue to operate as separate CPA firms.

Eide Bailly managing partner and CEO Jerry Topp and Wipfli managing partner and CEO Rick Dreher say the firms decided to amicably discontinue merger discussions because they could not come to an agreement on key terms, according to a press release.

If you have the ingenuity and the drive to make your operation thrive and grow, count us in. There’s a Bremer banker nearby with comprehensive solutions to help you manage all your business finances. Get the resources you need, without the runaround. Talk to your local Bremer business banker today.

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11

Prairie News

Press releases and photos about business news and events in North Dakota, South Dakota and western Minnesota can be e-mailed to avanormer@prairiebizmag.com for consideration

ALEXANDRIA COMPANY RECOGNIZED

The Alexandria Area Economic Development Commission recognized Alexandria Industries as a “Distinguished Economic Development Partner.” Pictured (L to R): Dan Olson (Douglas County), H. Dan Ness (city of Alexandria), Tom Schabel (Alexandria Industries), and Kevin Kopischke (AAEDC board chair) (Photo courtesy of Alexandria Economic Development Commission)

At its annual meeting, the Alexandria (Minn.) Area Economic Development Commission recognized Alexandria Industries as a “Distinguished Economic Development Partner.” Alexandria Industries in Alexandria, Minn., (the parent company of Alexandria Extrusion Company, Alexandria Extrusion South, Alexandria Plastics, and Alexandria Precision Machining) was selected to receive this recognition based upon a number of factors, including the company’s long-term commitment to the Alexandria community, continued organizational growth and investment in the area, and investments in workforce development initiatives throughout the region.

Alexandria Industries is a privately held, short lead time, precision manufacturer of engineered products with customers in a wide range of industries, niche markets and global locations. Since the company’s founding in 1966, employees and corporate leadership have been committed to utilizing industry-leading technology and the highest quality workforce to provide innovative design and manufacturing solutions to a strategic customer base who are challenged with dynamic and critical supply chain needs.

CHAMBERCHOICE AWARD FINALISTS ANNOUNCED

ALTRU EXPANDING

The Fargo Moorhead West Fargo Chamber of Commerce announced the names of 18 award finalists at its annual ChamberChoice Reception on March 22, an event sponsored and hosted by Wells Fargo Bank.

The ChamberChoice Awards Luncheon is scheduled for May 17 from noon to 1:30 p.m. at the Holiday Inn Fargo in Fargo, N.D. The ChamberChoice Awards program honors successful organizations in the Fargo Moorhead West Fargo area that are demonstrating growth and innovation and contributing to the area’s economy and quality of life. Following, listed in alphabetical order by category, are the names of the 2012 ChamberChoice Award finalists: Small Business of the Year: dogIDs, Onsharp, YHR Partners, Architects Business of the Year: General Equipment & Supplies Inc., Park Co. Realtors, Warner and Company Insurance Small Not-For-Profit of the Year: Freedom Resource Center for Independent Living Inc., Junior Achievement, Ronald McDonald House Charities of the Red River Valley Not-For-Profit of the Year: Community Living Services Inc., Dakota Boys and Girls Ranch, United Blood Service Young Professionals Best Place to Work: Advanced Engineering and Environmental Services Inc., Blue Cross Blue Shield of North Dakota, Choice Financial Entrepreneur of the Year: Barry Batcheller, Mark Schroeder, Alex Warner

Grand Forks, N.D.-based Altru Health System plans to expand and rennovate its hospital and main clinic facilities on Columbia Road and acquire some of the properties on South Washington Street owned by the Aurora group.

The health system has added 41 physicians in 2011 and 2012.

In addition to those starting this year, Altru is adding doctors to its clinics in Grand Forks over the next few years.

Altru completed a master plan last March with several priorities: improve the care experience for patients, making more hospital rooms private, accommodate growth fueled by physician recruitment, relieve congestion at the Columbia Road campus by moving services to other locations, and replace aging infrastructure and facilities, according to an Altru Health System press release.

12 Prairie Business

April 2012

FIRST FEDERAL BOUGHT South Dakota-based Great Western Bancorporation says it is buying the company that owns First Federal Savings Bank of Iowa for $41.5 million.

The corporate parent of Great Western Bank expects its deal for North Central Bancshares to close by summer.

Under the deal, each share of North Central common stock will be converted into the right to receive $30.58 per share, a 39percent premium over the March 12 closing price.

The deal will bring Great Western up to 200 locations throughout Iowa, Nebraska, Arizona, Colorado, Kansas, Missouri and South Dakota. The company says that after the closing, it will have assets of about $8.9 billion and deposits of about $6.7 billion.

Toby Madden, a regional economist at the public affairs department at the Federal Reserve Bank of Minneapolis, says during Expo 2012 in Fergus Falls, Minn., that states within the area of the Federal Reserve Bank of Minneapolis are in an economic expansion. (Photo by Alan Van Ormer/Prairie Business magazine)

REGION IN ECONOMIC EXPANSION The area represented by the Federal Reserve Bank of Minneapolis is in an economic expansion.

Toby Madden, a regional economist in the public affairs department at the Federal Reserve Bank of Minneapolis, told at least 50 people attending Expo 2012 at the Bigwood Event Center in Fergus Falls, Minn., that companies are producing more than has ever been produced in Minnesota.

“Business is remaining optimistic about their communities’ economy,” he notes. However, in Madden’s opinion, the nation’s high debt is what could hold the country back.

According to a recent survey of regional business leaders, in 2012, employment is expected to increase by 1.2 percent, the unemployment rate is expected to drop below 5 percent by the end of the year, wages could increase 2 to 3 percent, and personal income is expected to increase more than 5 percent.

Along with Madden’s presentation, Nadene Kruize, senior vice president of Minnesota Business Finance Corporation, discusses opportunities in financing deals with the Small Business Administration; Greg Smedsrud, CEO of Communicating for Agriculture Education Programs (Fergus Falls-based international ag internship organization with offices in 23 countries and more than 27,000 placements on four continents) talked about the importance of becoming a global player and building your own international presence; and Rob Fuglie, innovator and entrepreneur, explained how he started ‘Fergus Foods,’ a manufacturer of sunflower allergen-free snack food. prairiebizmag.com

13

Prairie People

ROBERT “BUTCH” MCCONN, JR.

LISA HELBLING

Please e-mail photos and press release announcements of hirings, promotions, awards and distinctions received by business leaders in North Dakota, South Dakota and western Minnesota to avanormer@prairiebizmag.com for consideration.

TMI HOSPITALITY EXPANDS LEADERSHIP TEAM

BECK TO LEAD MINNEHAHA LINCOLN DEVELOPMENT GROUP

As part of the company’s renewed focus on development and growth, TMI Hospitality Inc., one of the largest independently owned select service and extended stay hotel companies in the nation, is expanding its leadership team at the company’s headquarters in Fargo, N.D. Robert “Butch” McConn, Jr. is general counsel, Lisa Helbling is the company’s new chief financial officer and Tracy Koenig is chief information officer as well as president of TMI Communications Inc., the telecommunications division of parent company TMI Hospitality that also services the hospitality industry nationwide.

As general counsel, McConn will supervise and develop systems and processes for addressing legal risk to the company ranging from work completed internally, to selecting and managing outside legal counsel.

In Helbling’s role as TMI Hospitality’s CFO, she will oversee the financial functions and performance of the corporation. She will also oversee human resources, project management, internal audit and business risk management.

As CIO of TMI Hospitality, Koenig’s role will provide solutions that not only manage and keep data secure, but more importantly will lead the IT strategy that will help support the company’s growth plan and enhance customer experience through technology.

Erica Beck, economic development manager for the city of Sioux Falls, has been selected as the new executive director of the Minnehaha and Lincoln County Economic Development Associations. Beck succeeds Jeff Eckhoff, who recently became the state director for the South Dakota Small Business Development Center.

Beck has served Sioux Falls since 2005, working with urban planning and local growth initiatives that helped maximize the community’s economic prosperity. In 2010, she was chosen to be economic development manager in the Community Development department. In that capacity, she has administered the city’s Tax Increment Finance incentive, coordinated and managed numerous downtown development projects and worked closely with Downtown Sioux Falls, the Sioux Falls Development Foundation, South Eastern Council of Governments, the Governor’s Office of Economic Development and the Sioux Falls Area Chamber of Commerce.

ERICA BECK

BIBERDORF TO SERVE AS ENERGY IMPACT COORDINATOR

TRACY KOENIG

NEW SENIOR BUSINESS RELATIONSHIP MANAGER

CRAIG OHLHAUSER

14 Prairie Business

Craig Ohlhauser has been named senior business relationship manager for Wells Fargo in Bismarck, N.D. In his new role, Ohlhauser will work with business customers to help meet their commercial deposit and credit needs.

A native of Linton, N.D., Ohlhauser joined Wells Fargo in 2005 as a personal banker. Since 2006 he has worked with businesses across North Dakota, South Dakota and western Minnesota as a sales consultant for Wells Fargo Merchant Services. Prior to joining Wells Fargo, Ohlhauser served in sales and management roles for Vallely Sport and Marine and Combined Insurance, both in Bismarck.

April 2012

WAYNE BIBERDORF

Wayne Biberdorf will serve as western North Dakota’s energy impact coordinator.

Biberdorf, a Williston, N.D., resident, will work in the Oil Patch to help meet the challenges that come with rapid development.

In his new role beginning the first week of April, Biberdorf will monitor local issues and report on the region’s needs to the Governor’s office, cabinet members and to other state agency officials.

Biberdorf grew up on a farm in Bottineau County (N.D.) and graduated from Willow City (N.D.) High School in 1970. He received bachelor’s degrees in math and physics from Minot State University and a civil engineering degree from the University of North Dakota in Grand Forks. Biberdorf started his career as a teacher in the Minot, N.D., Public School System and has also worked for Hess Corporation in Tioga, N.D., where he held various engineer and management positions before retiring in 2010. He has been active in the Williston community with his involvement on the Northwest Workforce Advisory Board and the North Dakota Training Advisory Board at Williston State College.

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15

Economic Development

Growth in targeted industries key to North Dakota’s strong economy North Dakota has one of the strongest economies in the nation and while oil plays a role it is only one piece of the puzzle, making up just 25 percent of our state revenue collections.

teady growth in North Dakota’s targeted industries is key to our state’s strong economy and diversification. These targeted industries include advanced manufacturing, energy, value-added agriculture, technology-based business and tourism.

Our technology sector has gained national recognition and our information technology subsector job growth has been triple that of the nation. Microsoft and Amazon have both recently expanded. Amazon added a 30,000square-foot facility that will expand its customer service operations in Grand Forks and create 200 full-time jobs. Microsoft’s Fargo campus is one of the larger Microsoft locations worldwide, and its three buildings house over 1,500 employees, vendors and contingent staff.

Manufacturing also continues to grow in North Dakota. One example is the recent expansion announcement by Caterpillar in West Fargo. Construction has started on a $50 million project that will create about 250 new jobs during the next three years, nearly doubling the plant’s current workforce.

Caterpillar officials told us that North Dakota’s pro-business climate was a major factor in its decision to expand in West Fargo. Phoenix International, a company that manufactures electronics for John Deere, recently broke ground on a $22 million expansion project that will include 90,000 additional square feet in Fargo for an expanded workforce.

S

ALAN ANDERSON Commissioner North Dakota Department of Commerce 701-328-5312 alranderson@nd.gov

16 Prairie Business

April 2012

The state’s business growth also includes expansions at WCCO Belting in Wahpeton, Harris Manufacturing in Oakes, and at the Monsanto and Cargill facilities in the Fargo area. Cargill recently started a $50million expansion project and Monsanto has completed a $17.5 million expansion that has created 20 new jobs.

Tourism is another area that continues to drive North Dakota’s economy as the thirdlargest contributor to gross state product. The tourism industry growth is visible by looking at the number of new hotels constructed across the state. In the past two years, 21 new hotels have opened, adding 1,474 sleeping rooms in 11 communities. Another 24 hotels are under development and are expected to add another 1,800 rooms by later this year.

North Dakota has the lowest unemployment rate in the nation; we have 16,000 plus jobs openings, with 60 percent of those outside of oil-producing counties. In fact, the counties with the greatest number of job openings right now are Cass with 3,684 and Burleigh with 2,797.

North Dakota has added nearly 50,000 new jobs in the last decade. The American economy grew at a pace of 2.9 percent last year, while North Dakota’s economy increased by 7.1 percent last year.

Oil is just one piece of our economic success and our economy is much bigger and more diverse than ever before. PB

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17

FINANCE

Customers demand green Green dry cleaners.

Green energy.

Green car washes.

Green wall paints.

Green grease removal. reen: it’s everywhere. It’s at the center of many corporate manufacturing and marketing policies. And whether you believe in climate change or still have doubts, consumers are now demanding green.

Adopting environmentally friendly and energy efficient business practices provides numerous benefits to new and existing small business owners looking to control costs, attract customers and become socially responsible. Recycled, energy efficient, eco-friendly; these terms, and others, all help define the fast-growing green market.

So what can you do as a small business?

Remember, that regardless of what options you choose, each one of them should and must be connected to your marketing strategy and company messaging. If you adopt energy efficiency practices, let your customers know; if you are committed to local agriculture, let them know, and if your product contains recycled byproducts, let them know. Four out of five consumers say they are still buying environmentally friendly products and services today – which sometimes cost more – even in the midst of a recovering economy.

Save energy now. The prudent use of energy is one of the easiest and most cost-effective steps you can take to cut costs and increase profitability right now. Take these steps to get started:

G

an energy audit to quickly identify ❯ Conduct areas where you can save energy costs.

DAN HANNAHER Regional Administrator, Region VIII Small Business Administration 303-844-0505 Daniel.hannaher@sba.gov

18 Prairie Business

Energy Star appliances and office ❯ Purchase equipment. ❯ Provide energy saving tips to your employees for green power and renewable energy ❯ Look sources

April 2012

Be green-minded. You can own a restaurant, a dry cleaners, a construction company, a cardboard manufacturer—the type of business does not matter. You can go green with little or very large investments. A local restaurant may advertise farmto-table food choices, the dry cleaners offers a local bio-degradable detergent option, the manufacturer of pipes invests in a zero-pollution state-of-the art waste recycling facility.

You can decide that your entire operation goes green, or take a more incremental and affordable approach.

Build green. If you are opening a business in a new or remodeled building, make sure you build green by installing energy efficient heating and air conditioning systems, appliances, equipment and lighting. And consider Leadership in Energy and Environmental Design (LEED) certification. As an internationally recognized mark of excellence, it provides small businesses a framework for implementing measurable green building design, construction, and maintenance solutions.

HOW CAN SBA HELP? SBA is committed to providing entrepreneurs with access to the resources they need to plan, market and finance their green business ideas, services and products. For example, through the 504 loan program we have helped finance over 15 LEED certified projects and our Small Business Innovation Research program has funded numerous research grants, including economical and low capital intensive methods to dissolve heavy metal contaminants. PB For a free comprehensive online guide to green business practices and other resources connect to www.sba.gov and type Green Business Guide in the keyword search.

We’re looking for highly qualified people in these industries: Customer Service Representatives Fiber Glass Fabrication Metal Fabrication Employment Verification Printing & Press Operations Electronics Production Healthcare Welding

Aberdeeng!! is Growin

For further information contact the SD Department of Labor at 605.626.2340 or dlr.sd.gov and www.aberdeensd.com

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Research/Technology

The 21st century resurgent plains ONE OF THE LEAST ANTICIPATED DEVELOPMENTS IN THE GLOBAL GEOGRAPHY OF THE 21ST-CENTURY IS THE RESURGENCE OF THE GREAT PLAINS OF NORTH AMERICA.

or much of the past century the Great Plains has been caricatured as a “great mistake.”

You can survive on the plains according to conventional wisdom but hold your aspirations and dreams in check because you certainly can’t hope to thrive in flyover country.

In the next few decades, the plains states and prairie provinces could well prove a critical asset for the continent. During the current global economic crisis, the plains and prairie region has been experiencing a largely unheralded economic and social revival.

The oil and gas boom is certainly a big contributor to the region’s rising economic fortunes and ambitions. Surely this growth comes with challenges. But it also compels leaders in government, business and other sectors to plan and work together to take prompt action to build 21st century communities through investments in infrastructure, transportation, community facilities, public services, workforce development and housing.

Conventional wisdom about the Great Plains states and prairie provinces is being shattered in other unexpected ways.

The Great Plains is urbanizing, and some small and medium-sized cities enjoy the fastest job growth in the nation. Multi-purpose hubs that serve as regional trade, government and service centers with universities or colleges are showing the strongest growth but many smaller communities in proximity to economic opportunities in energy and manufacturing are experiencing new growth too.

F

DELORE ZIMMERMAN President, Praxis Strategy Group and Executive Director, Red River Valley Research Corridor

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April 2012

Agriculture is booming and becoming increasingly knowledge-intensive as tech-savvy farmers adopt precision agriculture practices and work with processors to reach high-value markets in food, fuel, fiber and pharma. A looming world population of 9 billion assures a growing long-term market for commodities and specialty products.

The Great Plains is a relatively “undiscovered” hotspot for science and technology-based development. The region has long boasted better education scores than most coastal states. North Dakota has the thirdhighest percentage of college educated people under 34 of any state. There is also rapid growth of technology corridors, including around Winnipeg, Manitoba, the Red River Valley, Sioux Falls and in parts of the Texas prairie.

In 2010, Inc. Magazine highlighted the Red River Valley Research Corridor’s emerging vaccine and infectious diseases industry but the corridor is also on the leading edge in microelectronics, manned/unmanned aviation, remote sensing, farm machinery and equipment, off-road vehicles, energy, agriculture, coatings and surfaces, and advanced manufacturing.

Our challenge will be to build on our existing and emerging opportunities, while ensuring that the benefits accrue as broadly as possible. This will require investments in education, training and infrastructure and the vigorous creation of networks around synergistic opportunities in agriculture, manufacturing and energy.

BUSINESS NEWS

NEW LEASE SIGNED Luminart Corp., the parent company of Black & Blue Water Service LLC and B 3 Well Services, announced the signing of an 80 acre materials lease contract in New Town, N.D. Adding to the fully operational 160 acres also located in Montrail County, this gives B 3 240 acres of aggregate mining in that area alone.

It's estimated that the 80 acres has approximately a half million ton in reserve. B 3 generates revenue through the sale of the aggregates and the trucking of the product to oil production and road construction sites. The company currently has committed reserves capable of providing 160,000 tons per month over the next three years.

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Architects/Engineers

The National Energy Center of Excellence on the Bismarck State College campus is designed to meet the requirements of silver-level LEED certification. (Photo courtesy of EAPC Architects Engineers)

If you build it...

LEED building designs catching on in the region

nergy efficiency experts are seeing growth in Leadership in Energy and Environmental Design (LEED) certified and other green-type building designs in the region.

Rebecca Molldrem, LEED accredited architect at JLG Architects in Fargo, N.D., believes the green energy phenomenon is about values. “People are realizing that population growth, health issues and environmental issues are a problem. They are educating themselves, saying they’re not okay with how things are and want to change it,” she says. “Value systems are changing.

Owners are saying they expect a green, sustainable building and will consider additional costs (to a point) to get that. Much like when people are willing to pay a slight premium for organic foods – they value the product because they feel it is healthier for them and more environmentally friendly to produce, and adjust their budgets accordingly.”

Stacey McMahan, principal and LEED accredited professional at Koch Hazard in Sioux Falls, S.D., believes the United States is a cash-crop society, but that people are also realizing the intrinsic and health value propositions. “The bottom line is effective in driving a lot of change,” she says.

There are different green building definitions, but the definition most always includes designing buildings that will last longer, are more efficient, cost less to operate, and contribute to healthier living and working environments.

LEED certification is a point-based system where building projects can earn LEED points for satisfying specific green building criteria. The five categories include sustainable sites, water efficiency, energy and atmosphere, materials and resources and indoor environmental quality. There are also four levels of LEED – certified, silver, gold and platinum.

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April 2012

According to the Green Building Certification Institute (GBCI) website, there are nine LEED certified projects in North Dakota. The highest LEED standard is gold in the state. Four buildings meet those standards - GRE/Gagnon Office Building in Bismarck, GSA Land Port of Entry in Antler, Microsoft Fargo in Fargo, and Standing Rock Community Elementary School in Fort Yates.

South Dakota has 22 LEED certified buildings. Two are platinum, which is the highest level that can be achieved.

Heartland Consumers Power District in Madison and Museum of Visual Materials in Sioux Falls have both reached that level.

MINNESOTA LEADS IN LEED CERTIFIED BUILDINGS Minnesota has the most LEED certified buildings in the threestate region with 160. There are nine platinum facilities. In western Minnesota, the University of Morris Community Service Building in Morris is rated gold. Silver certified buildings include Evergreen Hall at the University of Minnesota-Crookston, Lakeland Mental Health Center in Fergus Falls, North Country Health Service Senior Housing in Bemidji, and West Central Research and Outreach Center in Morris.

Mike Smoczyk, director of education at Kraus-Anderson and LEED green associate housed in the Twin Cities and also on the board of directors of the Minnesota chapter of the United States Green Building Council, says there is an increase in the awareness of energy efficient buildings. He notes that in Minnesota public buildings, like county facilities, universities and state schools, are working to meet the B3 guidelines focused on energy.

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Architects/Engineers must exceed the state energy code by at least 30 percent, focus on achieving the lowest possible lifetime costs, encourage continual energy conservation improvements, include air quality and lighting standards, create and maintain a healthy environment, facilitate productivity improvements, specify ways to reduce material costs, and consider the long-term operating costs of the building including the use of renewable energy sources and distributed electric energy generation that uses a renewable source or natural gas or a fuel that is as clean or cleaner than natural gas.

“The state of Minnesota insists that their buildings meet the three guidelines focused on energy,” he says. “It is also easy to access good information so people everywhere are more aware.”

Kraus-Anderson is working on two LEED registered facilities in western Minnesota. One is in Wadena, the community that was devastated by a tornado a few years ago. The high school will be ready to go within six months, Smoczyk says. “They were interested in energy efficiency, in particular, investing in insulation and taking measures that will save money for the life of the building,” he states.

Alexandria is also pursuing a LEED registered building that will be breaking ground in the spring. “There was very much of an interest by the community,” Smoczyk says. “They brought up sustainability and energy efficiency. People are concerned about that and wanted that.”

He also believes that LEED, Energy Star and B3, which are state and national programs that assist with energy efficiency and sustainability, are spurring green building.

“People are becoming more aware of energy and environmental needs, as well as saving money in the long run,” Smoczyk states. “We are all taxpayers and with public buildings, should thoughtfully plan to save energy and money.”

Smoczyk says many are trying to educate people to invest more upfront and understand that there will be a payback in an eight year time period or less and savings for many years after that. “That is more and more the way buildings are being built,” he says.

THE NUMBER OF SQUARE FOOTAGE OF LEED CERTIFIED BUILDINGS IS INCREASING EACH YEAR According to Leap Chear, LEED certified architect at EAPC Architects Engineers in Fargo, N.D., in 2011 there was 1.7 billion feet of commercial space. “Buildings that have gone through the LEED process are starting to collect more data and learning that LEED buildings are energy efficient and sustainable and they are starting to get the proof,” he says.

Chear notes that EAPC has several projects that have potential for LEED certification. “We are hoping to put more up in the coming years,” he says, adding the firm has set a goal for one LEED certified project for each office per year.

He also says that in North Dakota more projects are going through the registration process. “Government projects, both new and major renovations, are required to be LEED certified,” he states. “It is good to incorporate those LEED strategies even if they are not going through the process.”

McMahan says the United States government is leading the change.

“GSA (U.S. General Service Administration) is requiring LEED certification. Other departments are assessing for LEED but not requiring it,” she explains.

McMahan notes there are programs in nearly every state studying environmental impact, sustainability or requiring LEED building certification. For instance, Sioux Falls is currently engaged in a sustainability MP including a greenhouse gas (GHG) assessment. There 24 Prairie Business

April 2012

are also comprehensive programs in Austin, Texas and Chicago, as well as pilot city programs in Charleston, S.C., and Fayetteville, Ark. Another reason why LEED certified square footage is growing is that information is spreading and manufacturers and the construction industry are taking the lead and making their product more sustainable and environmentally friendly.

Rebecca Molldrem, LEED accredited However, Chear states that architect at JLG Architects in Fargo, N.D. costs are coming down because there are better materials and products being manufactured every year, as well as more efficient equipment. “The benefit is so great, that these initial investments are worth it.

You can expect higher performing business without initial higher investment,” he says. “With the LEED process, it takes more effort and time in the design stage because it requires a much higher level of design strategy. Green projects or green buildings continue to Leap Chear, LEED certified architect at cost more at the same rate.

EAPC Architects Engineers in Fargo, N.D. Manufacturing industries are starting to adapt to it and prices will eventually come down.”

The main benefits of building green include reducing energy consumption, protection of ecosystems and improved occupant health.

McMahan states that architects need to take the long view in regard to costs as well as a more comprehensive one to include embodied costs of materials and projects. “For example, expending energy extracting virgin materials when materials can be reused from another deconstructed building, or shipping tile from China instead of using a more local material, preserving and renovating a building instead of tearing one down and constructing buildings to last 100 years instead of 30.”

There are also several challenges associated with constructing LEED buildings.

Smoczyk believes that the major challenge is always the upfront costs to invest in better windows, better building envelopes, and more efficient mechanical systems that over time will have a payback.

Chear says, for one, developers are slow to embrace it because of the initial investment. “They need to look at it as an investment down the road,” he states. “Invest in the building upfront and reap the benefits for the life cycle of the building. The payback is going to be there.”

Molldrem states that with the change in the energy code, in particular the R value (insulation properties), it is causing manufacturers to change the way they detail products. “Now the more we get into design build, the construction managers are asking us to do initial energy calculations,” she says. “Architects are taking on more responsibility for energy efficiency earlier in the design.” PB

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Midwest Models

The University of Minnesota Crookston’s Evergreen Hall is the first University of Minnesota LEED registered residence hall. The 32-bedroom apartment with 128 beds was constructed in 2008 and is silver certified. (Photo courtesy of U of M Crookston)

Starting in 2012, every home sold by DynamicHomes will be Energy Star ready with R21 insulation for the walls and R50 insulation for the ceiling.

The standard in Minnesota is R19/R44. (Photo by Alan Van Ormer/Prairie Business magazine)

Paul Fick Homes, in Sioux Falls, S.D., is finding that being part of the green building program in the city is paying big dividends in its homebuilding operations. (Photo courtesy of Paul Fick Homes Inc.)

Energy efficient living Energy efficiency a must in the Midwest climate

ost architects and engineers who design buildings in the region are conscious about energy efficiency using various techniques to assist homeowners and commercial buildings.

“It is important to do this in this region because of the climate we live in,” says Mic Buschette, vice president of operations at DynamicHomes, headquartered in Detroit Lakes, Minn.

Starting in 2012, every home sold by DynamicHomes will be Energy Star ready with R21 insulation for the walls and R50 insulation for the ceiling. The standard in Minnesota is R19/R44.

The homes are constructed in the production facility in Detroit Lakes and then delivered to the building site. Once there, Energy Star certifies it on site.

Energy Star is a residential program implemented by the U.S. Environmental Protection Agency and the Department of Energy that maintains energy efficiency standards 15 percent higher than that of the International Residential Code.

“We are practically doing it now anyway,” Buschette explains. “We have the ability to guarantee people what they are getting and meet Energy Star requirements also.”

Phil Stahl, principal architect for Stahl Meland Architects and

M

26 Prairie Business

April 2012

Stahl Meland Architects and Builders in Fargo, N.D. continuously work various energy efficient items in construction. (Photo courtesy of Stahl Meland Architects and Builders)

Builders in Fargo, N.D., says architects and engineers have been taught since the 1970s about energy efficiency in buildings. “Good builders build good homes,” he states. “It is so ingrained in everything we do.

Good green design is part of what we do.”

TRANSFORMING A RESIDENT HALL TO LEED While DynamicHomes is constructing 200 homes a year and Stahl Meland Architects and Builders continues to add energy efficiency in construction of $400,000 to $1 million homes, higher education campuses across the region are focusing on Leadership in Energy and Environmental Design (LEED) standards for different facilities.

The University of Minnesota Crookston’s Evergreen Hall is the first University of Minnesota LEED registered residence hall. The 32bedroom apartment with 128 beds was constructed in 2008 and is

Midwest Models silver certified.

“In my view every building should be built like this up-front because it uses less energy,” says Daniel Svedarsky, director, Center for Sustainability on campus. “It has resulted in less energy being used in operations, but we’re not sure exactly how much since we are still in the process of getting better monitoring equipment.”

LEED consists of a suite of Daniel Svedarsky, director, rating systems for the design, Center for Sustainability at construction and operation of highU of M Crookston. performance green buildings, homes and neighborhoods. LEED is intended to provide building owners and operators a concise framework for identifying and implementing practical and measurable green building design, construction, operations and maintenance solutions.

The new dormitory was constructed in part because students at the university decided it was important to take a long-term view of the facility and look at energy efficiency.

More than 99,000 plastic bottles were saved by using Bolyu carpet.

All the appliances are Energy Star rated. The counter tops consist of recycled banana peels. All kitchen cabinet hardware in the apartments were salvaged from McCall Hall, refinished and installed. Lighting pendants located in the first floor lounge were salvaged from Kiehle Hall and refurbished for use in Evergreen Hall. Vetrazzo countertops found in the first floor common bathrooms are made from recycled apple juice jugs, root beer, vanilla and medicine bottles.

“The campus needed to do this to show the way and to demonstrate how to live life with less,” Svedarsky says. “This is a living example of sustainability and using resources in a way that won’t adversely impact future generations.”

The university is planning another energy efficient residence hall and is expected to break ground in the spring and be completed in 2013.

Svedarsky says one of the challenges of LEED certified campus facilities is management of construction debris because of the LEED recycling process. Overall, Svedarsky and the campus community hopes to transition to a greener campus.

“It is the right thing to do for the planet, as well as the right thing to do for the pocketbook,” he states. “It all boils down to economics, but we have to look at the long-term.”

GREEN BUILDING PROGRAM IN SIOUX FALLS Paul Fick Homes, in Sioux Falls, S. D., is finding that being part of the green building program in the city is paying big dividends in its homebuilding operations.

“Locally, I’m trying to push it more often,” states Paul Fick, who is the owner/president of Paul Fick Homes Inc., and also a member of the National Association of Home Builders (NAHB). “Part of it is education to the public and other home builders. I’m convinced that under new building codes we’ll soon be required to do it anyway.”

Green building is something that the Sioux Falls homebuilder has been studying over the past three years and incorporating in all of his building projects, so it was just a natural fit to become part of the green building program. There is a National Green Standards booklet with six chapters that discusses different aspects of green building. Like LEED

28 Prairie Business

April 2012

certification, the green building program accumulates points that lead to brown, silver, gold, or emerald certification.

“People around Sioux Falls are becoming more aware of the program and the houses legitimize what they are seeing,” Fick notes. “It is a better built home, lasts longer and is more energy efficient. They are going to notice it.”

At first, paperwork and education Paul Fick, owner/president of Paul Fick Homes Inc. was a challenge, but now Fick believes that the challenges are in the past.

“Even though we are improving scores in some areas, the building is still going to be built green.”

WORKING IN AN ENERGY EFFICIENT ENVIRONMENT While all construction is not LEED certified or Energy Star certified across the region, architects continuously work various energy efficient items into construction.

For example, Stahl says geothermal is taking off in the area.

“Companies are doing a good job of marketing geothermal decreased costs in the long run,” he says. “It is expensive to put in geothermal but the owners are going to see savings 15 years out.”

In addition, Stahl’s buildings will use structural insulated panels with a higher thermal performance than 2x6 insulated stud walls.

“Typically, we build structures with insulated panels saving the homeowner 50 to 60 percent in energy costs,” he states. “We are always conscious about energy efficiency.”

Many architects say that the design portion of the construction of a building is the important point in dealing with energy efficiency. For example, Stahl has fiddled with passive design by using more natural light in his own office space. In addition, anywhere the employees walk they are looking at a window area.

Other examples of his construction projects are routing water to a planting bed and installing radiant floor heat. What is also happening is that codes are catching up to what architects and engineers are doing, meaning it is in their best interest to become more energy efficient in designing projects.

By designing every home as an Energy Star home, DynamicHomes is hoping to increase its $18 million a year gross revenue and add to its 100 or so employees.

“It is going to help our business going forward,” states Paul Nord, chief financial officer. “It gives our dealer network a leg up on our competition.”

Along with the increased R-values, DynamicHomes adds vapor barriers to keep air infiltration to a minimum, has installed air-tight ceiling fixtures, and is foaming all ceiling and exterior walls.

In its marketing brochure, DynamicHomes says it can provide a certain amount of savings for its three-bedroom rambler depending on where it’s located in the region. For example, in southeastern South Dakota a homeowner has a 52 percent savings, in south central a 74 percent savings, and in northeastern Minnesota a 61 percent savings.

In addition, the construction company is finding that homeowners are seeing a savings of up to 50 percent or more, reducing the chance of mold and pollutants, and reducing air infiltration up to 66 percent. PB Alan Van Ormer - avanormer@prairiebizmag.com

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Efficiency Leaders

Since retro-commissioning of the Grand Forks County Office Building, the county saved more than $1.4 million in energy costs. (Photo courtesy of Dave McFarlane)

The first year after tune-up and retro-commissioning of the Grand Forks County Courthouse, the county saved more than $40,000 in energy costs.

(Photo courtesy of Dave McFarlane)

Making strides in efficiency Leading the way efficiently ave McFarlane found his niche later in life about the time he was getting ready to retire from running a business in Grand Forks, N.D. Now retired, McFarlane has relocated to Fort Meyers, Fla., and is involved with retrofitting projects all across the nation with his company Technical Commissioning Inc. In essence, McFarlane is one leader who is helping make strides in efficiency across the region and the nation.

To be a leader in building energy efficiency, McFarlane says it takes good engineering skills and technicians that are skilled in the ability to measure airflow and temperatures, and to develop packages that you can take to people and provide opinions on what they are going to save.

D

WHAT IT TAKES TO BECOME A LEADER IN ENERGY EFFICIENCY Designing energy efficient buildings is increasingly becoming a global issue. “The number and intensity of highlevel discussions regarding energy costs and the reduction in conventional energy resources is increasing,” says David Crutchfield, assistant professor for architecture and landscape architecture at North Dakota State University in Fargo. “To a great extent, the market is demanding it; the profession is telling us they want graduates who understand energy use, and our students want to learn how to do these

30 Prairie Business

April 2012

things.”

Crutchfield teaches a course titled Environmental Control Systems in Architecture. In this, the first of two semesterlong courses on building technology systems, students are taught how to design buildings that minimize energy consumption and respond effectively to their climate conditions.

“As a whole, our entire curriculum in architecture is geared to the reduction of energy use,” he states. “From the beginning to the end, we strongly emphasize the consideration of energy consumption and environmental impact in the design of buildings.”

Crutchfield sees firsthand the next generation of leaders who will be developing the energy-efficient buildings of the future.

“Education is a big part of this. Understanding the fundamentals and keeping-up with the latest technologies is not easy.” Crutchfield notes. “Leadership is a significant part of this as well – this includes the ability to think beyond normal conventions as well as the willingness to accept the risks of innovation. All of this is required of great leaders in energy efficiency.”

Along with leadership skills, other traits include being an effective communicator, being proactive and wanting to make a difference. “It also requires an analytic mind, a

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Efficiency Leaders person who not only wants to understand complex systems but seeks to understand the interactions and integration of complex systems,” Crutchfield states. “Our students need to understand not only how systems work but how they interact together to create an effectively designed environment.”

More importantly, once they are in the profession, they become decision makers. “What designers really do is make many, many decisions,” Crutchfield explains. “We continuously seek to reconcile numerous competing factors throughout the design process each with varying weights of importance - including energy efficiency.

In this way, the decisions designers make impact everyone down the line to manufacturers. It really has a rippling impact all the way through the economy when architects make these decisions.”

DEVELOPING RETRO-COMMISSIONING McFarlane was one of those architects that had to make tough decisions during his career.

As owner and manager of McFarlane Inc., he and his staff have performed heating ventilation air conditioning (HVAC) retrocommissioning for more than 30 years. He has developed processes and techniques to help minimize problems in existing buildings.

McFarlane first developed the retro-commissioning approach 30 years ago while working with the University of North Dakota (UND) in Grand Forks to help correct problems in existing buildings.

The retro-commissioning process produces buildings where all equipment and controls work as owners expect. Through his involvement with the National Environmental Balancing Bureau (NEBB), McFarlane has helped form U. S. national standards for environmental balancing in HVAC systems. He has 35 years of experience with industrial, design-build, commissioning and retrocommissioning projects.

Two major retro-commissioning projects he worked on in Grand Forks include the Grand Forks County Courthouse and Grand Forks County Office Building. The County saved more than $1.4 million in energy costs at the county office building.

Complaints dropped by 90 percent, since people stopped complaining when they knew their workspaces were maintained within agreed-upon temperature ranges. The first year after the tune-up and retro-commissioning of the courthouse, the county saved more than $40,000 in energy costs.

McFarlane has been developing the retro-commissioning in western Minnesota and North Dakota for the past 10 years. He started working for the Air National Guard three years ago and has completed projects in Ohio, Missouri and Iowa.

He notes there is a market demand for this type of work. “The federal government has mandated that (energy use) in all federal buildings be lowered by 30 percent by 2020,” he says. “Every federal building has to do what we know how to do well. Personally, I find it very rewarding working with owners interested in doing something right opposed to doing something that is cheapest.”

In order to provide energy efficiency, Technical Commissioning provides a benchmark for buildings to see how much energy is being used and compare that to what a typical efficient building of similar size would use. For example, an office building that is 20,000 to 30,000 square feet should use in the range of 90,000 Btu per square foot per year.

The firm uses three years worth of data, converting kilowatthours and therms of gas into energy usage and determining how much energy it is using per square foot. Then McFarlane makes 32 Prairie Business Energy

April 2012

small changes or what he likes to call “tune ups” to get the building running as efficient as possible.

“It is very simple when you know what you are looking for,” he says.

Those who use Technical Commissioning’s method are reducing energy bills by 30 percent and also are comfortable in the building, McFarlane notes.

He also believes it is Dave McFarlane, owner of Technical important to be a leader in Commissioning Inc. building efficiency because if not, the competition will have a competitive edge. “It benefits your company by bettering the financial statement.”

McFarlane is finding that customers are more educated. “They are finding out who the leaders are and developing relationships,” he says. “Most of our work is with state, local and federal government. North Dakota energy is still quite low compared to other parts of the country. That will start going up and when it does the private sector will be jumping in.” PB Alan Van Ormer - avanormer@prairiebizmag.com

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Energy & Environmental Research Center (EERC) research manager, Josh Stanislowski, stands in front of one of the EERC's unique gasification systems used to create liquid fuels. (Photo courtesy of EERC)

EERC developing alternative liquid fuel for military The Energy & Environmental Research Center (EERC) in Grand Forks, N.D., is developing alternative liquid fuels for military and commercial applications.

ERC deputy associate director for research, Mike Holmes, says developing alternative liquid fuels will improve energy security, cost and efficiency, sustainability and develop the availability of a system that can coproduce electricity and liquid fuels.

“The military has been good at developing products that private companies and consumers can benefit from,” he states. “This has the possibility for development of moderate-scale systems that allow distributed production of power and fuels, utilizing coal and regional sources of biomass.”

The Connecticut Center for Advanced Technology Inc. (CCAT) in East Hartford, Conn., awarded EERC a $906,000 contract to develop alternative liquid fuels. The

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34 Prairie Business Energy

April 2012

EERC will demonstrate gasification-based technologies for converting nonpetroleum feedstocks, such as coal and biomass, into liquid fuels.

Tom Maloney, CCAT’s director of technology, research and applications, says the military will benefit from technologies that are commercially viable. He adds there are at least two reasons CCAT and EERC are working together on the project.

“We would rather use an existing facility rather than duplicate facilities,” he says. “We also want to utilize the best resources, like EERC, to save money. The collaboration among EERC, DoD (Department of Defense), DOE (Department of Energy), CCAT, and project partners like Arcadis and Avetec have allowed us to

leverage the existing EERC resources to the benefit of everybody involved.”

According to a joint press release, the EERC is supporting the CCAT team by using the EERC’s transport reactor development unit and bench-scale entrained-flow gasifier (EFG) systems to evaluate the impact of fuel quality and operating conditions on synthetic gas composition, gas clean-up, system performance, overall process efficiency and CO2 emissions.

The EERC is a research, development, demonstration and commercialization facility recognized as one of the world’s leading developers of clean, more efficient energy technologies, as well as environmental technologies to protect and clean air, water and soil.

CCAT helps private and public entities to apply innovative tools and practices to increase efficiencies, improve workforce development and boost competitiveness.

In January 2010, CCAT started looking at different gasification techniques to assist the military’s mandate on becoming more energy independent through the utilization of sustainable energy and fuels. EERC’s

EERC deputy associate director for research, Mike Holmes

CCAT director of technology, research and applications, Tom Maloney

previous gasification testing drew CCAT’s attention and a partnership was formed between the two entities to test the viability of wood and algae as biomass for jet fuel.

Previous testing performed in the EERC’s gasification systems shows that a highly clean gas can be produced from coal and coalbiomass mixtures, which is essential for the production of quality liquid fuel, according to the joint press release.

“This will show the versatility of the system for various biomass feedstocks to be utilized at different bases,” Holmes says.

Maloney envisions a plant system in either the military or consumer sector. “The goal is to have a commercial plant up and running by 2020,” he says.

The major challenge is gathering more data and conducting more testing in order to prove the economic and technical viability of making liquid fuels from coal and biomass mixtures. “We still have a lot to learn,” Maloney says.

Alan Van Ormer avanormer@prairiebizmag.com

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35

NDSU CNSE lab analyzing clay samples Scientists in a lab at North Dakota State University’s Center for Nanoscale Science and Engineering (CNSE) in Fargo, N.D. are analyzing materials that could eventually play a role as an ingredient in proppants used in oil exploration.

As part of a research agreement with the North Dakota Geological Survey (NDGS) in Bismarck, N.D., the Materials Characterization and Analysis Laboratory at NDSU CNSE is analyzing 198 clay samples to determine their composition and suitability for use as a component in hydraulic fracturing. The clays show early promise for potential use as a key material known as ceramic proppant, used in the fracking process to help keep fractures open. The fracking process is used to extract oil and natural gas deep within the ground in places such as the Williston Basin and the Bakken Oil Shale Formation.

The MCAL lab at CNSE provides scientific

North Dakota Minnesota Michigan Missouri Alberta

expertise and a unique set of analytical capabilities and instruments not typically found in other settings. “The lab has excellent analytical equipment, a very good reputation for generating accurate results in a timely manner, and the lab personnel are easy to work with,” says Ed Murphy, state geologist for North Dakota.

Energy industry publications have referenced shortages of proppant. Results from the scientific study of the samples could shed light on whether North Dakota could eventually supply some of the proppant materials needed for oil exploration.

The clay, known as kaolinite, is found in some hillsides in western North Dakota. Researchers at NDSU CNSE will use x-ray fluorescence to determine which elements and how much of those elements are contained in samples from the various locations.

Prairie Business staff and wire reports

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36 Prairie Business Energy

April 2012

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37

Business Development

Bel Brands USA will be building a 170,000-square-foot facility to process cheese on this piece of business property in Brookings. (Photo courtesy of Brookings Economic Development Commission)

Brookings attracts big business With the news that Chicago-based Bel Brands USA will be building a 170,000-square-foot facility to process cheese, Brookings, S.D. has added another piece to its manufacturing portfolio.

“

e can’t sit here on an island. We continue to look at the whole area,” says Brookings mayor Tim Reed. “One of the key selling points is that we are doing something for the whole region. Dairy farms, small towns and communities in the region will all prosper.”

The cheese facility will be located just north of the Swiftel Center in the Foster Industrial Park just off Interstate 29. It is estimated that 200 jobs will be created in each of two phases for a total $160 million investment. An estimated 12,000 to 14,000 dairy cows will be needed to support the cheese factory. The economic impact per dairy cow is $13,500 per

W

38 Prairie Business SD

April 2012

year. In addition, the cheese plant will produce 11,000 metric tons of cheese per year and will need at least 2 million pounds of milk per day once the second phase is completed.

Bel Brands hopes to break ground in July 2012 and start manufacturing in 2013. Full production of the first phase is slated for July 1, 2014. Phase 2 will start depending on the market.

The cheese factory is the latest addition in a string of companies locating in Brookings, representing the dairy industry cluster. Other cluster components include Sterling Technologies, DairyNet Inc., South Dakota State University’s

Mayor Tim Reed, Brookings, S.D.

Dairy Science Program, and several regional dairies.

Growing value-added agricultural businesses are one component of Brookings’ targeted industry development strategy.

Brookings employs the largest number of manufacturing workers in South Dakota behind Sioux Falls. It consists of such stable manufacturing companies as Daktronics (nationally known producer of scoreboards), Larson Manufacturing (windows) and 3M (medical equipment.)

In addition, Brookings has three industrial parks available for manufacturing companies. There is the Telkamp Industrial Park, which has 18 acres available.

There is still 30 acres available in the Foster Industrial Park.

The Svennes Industrial Park has a 14-acre parcel and a 25acre parcel ready for a manufacturing company.

Brookings’ economic strategy was developed six years ago after a day-long visioning charrette. “The charrette process involved more than 120 community residents in an exercise to discuss desired economic growth scenarios and community design features,” says Al Heuton, executive director of the Brookings Economic Development Corporation.

Brookings’ strategy involved five broad areas – animal health, human health, green energy, agriculture and plant science and high technology (advanced manufacturing).

.The strategy is closely aligned with research taking place at SDSU. “A key challenge going forward is access to human capital,” Heuton says. “SDSU is the largest provider of new human capital opportunities in the region.”

Six years ago, the community discussed economic scenarios that included business development, recruiting and maintaining a workforce and housing. There was a housing shortage, but since then the community has added 1,400 housing units.

Reed says because the groundwork had been laid earlier the community was ready for a large manufacturing company like Bel Brands. However, the community was not looking at adding a large manufacturing company; the main emphasis has been to target recruiting with a primary focus on smaller manufacturers, and science and technology companies.

South Dakota was contacted by a site selector through the Sioux Falls Development Foundation in October 2010.

A company was looking at the I-29 corridor from Brookings to Sioux City, Iowa. The foundation contacted the South Dakota Governor’s Office of Economic Development in Pierre, S.D. Brookings received the information in December 2010.

“Initially, we were eliminated,” Heuton says. “We produced additional information that got us back in.”

Brookings was finally selected as the community Bel Brands would build its third plant. The other two are located in Kentucky and Wisconsin.

Heuton believes a big advantage was the May start-up of a $9 million SDSU Dairy Science Research facility that produces milk, ice cream and cheese. In addition, Brookings County has the largest number of dairy cows in the state. Then there was the site, which is located at two interstate exchanges and has a visible location from the interstate.

“What was critical for us was that it ties into our comprehensive strategy,” Heuton says. “Brookings just shows extremely well. We have a lot to offer prospective businesses and residents.”

The workforce was also critical and with SDSU in the community, Heuton says Bel Brands will be able to add the workers gradually.

As part of its strategy, the BEDC continues to discuss workforce needs with manufacturers and how to solve issues.

“At this point we aren’t trying to recruit larger businesses,” Heuton states. “We won’t be looking at that unless the opportunity (like Bel Brands) comes along to add a level of diversity.” PB Alan Van Ormer -avanormer@prairiebizmag.com

prairiebizmag.com

39

South Dakota

SD Wins implemented A commitment to maintaining South Dakota’s quality of life and growing the state’s economy led Gov. Dennis Daugaard to implement development of SD Wins – the South Dakota Workforce Initiative. he long-term program is bringing government, education and business leaders together to capitalize on South Dakota’s potential for growth and development in many different ways. Objectives of the program include developing and attracting a strong, educated workforce to help position the state to compete in a global economy.

Gov. Daugaard’s policy advisor, Kim Olson, says SD Wins targets four categories that are key to the state’s success in continued growth.

“In order to prepare youth for South Dakota’s workplace, our education system is helping students understand what their career options are,” Olson says. “We are seeing profound shortages of skilled workers so this program will assist both traditional students and non-traditional students in gaining access to the necessary training. We also see a growing demand for health care professionals in rural areas. If quality healthcare isn’t available in rural areas, it will be more difficult to attract other work forces there. To meet that need, SD Wins promotes rural health care occupations.”

The fourth component addressed by SD Wins is new South Dakota residents. Either former residents or those coming to live in the state for the first time will find a favorable atmosphere for living and working there.

“These categories were developed after a year of visits and discussions with businesses and community members across South Dakota,” Olson says. “Over 200 businesses provided input about what they and their community needed in order to grow into the future. Workforce was the common theme identified when those comments were analyzed.”

Students with science and math aptitudes will be in great demand in every aspect of South Dakota’s future workplace. In addition to rewarding science and math teachers in the state, SD Wins utilizes the SD MyLife web portal to give students access to career information and facilitates hands-on career cluster camps in engineering, IT, skilled trades and other high-demand areas.

“Through SD Wins, we’ll also broaden the K through 12 experience, giving more personalized education to those who need remediation or are ready for advanced placement or college courses,” Olson says. “There may be those in the workforce who require additional training to reach their career potential. Federal Community Block Grant dollars will be used to help provide additional workforce training opportunities.”

SD Wins will add more capacity to the state’s medical and physician’s assistant education and expand recruitment and retention incentives to include more providers and more rural communities. New South Dakotans will find a reinvigorated Dakota Roots program that partners with businesses to recruit new pioneers, new South Dakotans to the state to take chronically unfilled, open positions in the workplace and in communities.

Regular monitoring through housing surveys will assist

T

40 Prairie Business

April 2012

communities in development and marketing of housing options and investment opportunities.

Governor Daugaard notes that bringing South Dakota’s leaders together is key to the state’s growth and development.

“The success of South Dakota’s economy depends upon the strength of our workforce,” Daugaard says. “That’s why we’ve launched South Dakota Wins, a workforce development program that brings together leaders in business, education and policy to capitalize on South Dakota’s tremendous potential. The South Dakota Wins package will help South Dakota develop and attract a strong, educated workforce, positioning us well to compete in a dynamic global economy.” PB More information about SD Wins is available at www.southdakotawins.com.

Sorensen is the owner of Prairie Hearth Publishing LLC. sorensenlms@gmail.com.

Architecture

Architecture students help community develop vision for growth A group of architecture students at North Dakota State University in Fargo, N.D., are using different design methods to help the community of Kindred, N.D., develop a vision for future growth.

Emma Wey and Kris Thielen, two architecture students at North Dakota State University in Fargo, study a replica of Kindred, N.D. A group of architecture students are working with Kindred community members to develop a vision for future growth. (Photo by Alan Van Ormer/Prairie Business magazine)

“

he students will take information and begin to develop four different scenarios on how Kindred could develop in the future,” says Don Faulkner, professor in the NDSU Department of Architecture and Landscape Architecture, located in Renaissance Hall in downtown Fargo. “We do similar sorts of things quite often. Each community is different. Situations are different. As a department we do a lot of outreach for communities and nonprofits around the region.”

In February, NDSU architecture students, met with Kindred residents to gather information. In addition, the students did research and gathered information ahead of

T

time and shared it with the community. It included asking questions about the history of the community, what makes Kindred special, a list of least favorite places and favorite places in the community, as well as infrastructure and sustainability issues.

The students will meet with the community two more times before the semester ends in May. Emma Wey, a fourth year architecture student from Brookings, S.D., found out how passionate people are in the city of Kindred. “Everyone got really involved and wanted to tell their life story and talk about what they thought of Kindred,” she says. “They really wanted to see

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42 Prairie Business RRV

April 2012

Kindred grow. They were really supportive.”

Wey notes the difficult piece was gathering all the information because of the extensive history in the community. “We touched every part and got a well-rounded view of Kindred,” she explains. “This was a new experience for all of us.”

What the students found in the research was that Kindred is a bedroom community of Fargo. “A lot of people that live there work in Fargo,” Faulkner states. “That is different than other places we have worked with.”

Wey noticed that when she was taking photos of homes and businesses in the community, there were no abandoned buildings. “The community is economically doing very well,” she says. “It is small, but still thriving. It is not a dead community.”

The students participating in the project are fourth-year students in the five-year master of architecture degree program. The students are working in an urban design studio on the fourth floor of Renaissance Hall.

Faulkner believes that the program is unique because students are working with real clients, real people and a real community.

“We’re not in the habit of competing with the professionals in the area,” Faulkner states. “We try to help communities and nonprofits that don’t have a lot of resources to help get groundwork done so they have good information and a good sense of what it is they want to accomplish. They can then go hire someone to complete that work.”

For Kris Thielen, another fourth-year student in the architecture program, it helps to be involved in a natural real-life situation.

“It was not a hypothetical problem pulled out of the air,” says Thielen, who grew up in central Minnesota. “We’re involved in real problems and involved in real solutions and developing solutions.”

Thielen notes that many architecture students don’t have the opportunity to do this.

Wey adds that they were able to take a real community and help make real improvements. “We’re not going to make a future plan for Kindred, but help them have input in the vision,” he says. “We have never done a project to this scale. We have three engagements and actually interact with the communities.”

In addition, Wey says the students don’t mind doing the work. “It is a different type of work than what we are used to doing,” she says. “It is research based and engagement based. We are talking and reaching out with the community.” PB Alan Van Ormer avanormer@prairiebizmag.com prairiebizmag.com

43

Company reaps Bakken benefits, looks to the future n two years, Summit Energy Services has seen phenomenal growth in western North Dakota. Last year, the energy services company saw 650 percent growth.

“For anybody in the energy business, this is a cyclical cycle,” says Mike Sweeney, owner and president of Summit Energy Services, headquartered in Williston, N.D. ‘We have to be wise and prepare for the inevitable turnaround. We don’t live in fear that everything is going to fall apart. We try to keep a healthy balance in what we loan and lease.”

Sweeney notes that there is always a need in the industry for a company that provides good customer service. “We strive very hard to provide whatever it is a producer is looking for,” he says. “One of the things we do differently is diversifying what we do.”

Prior to forming Summit Energy Services in 2010, Sweeney was a regional manager for a Denver company in six different states. He was in Williston when the company folded. “I was here with a profitable region, good employees and good customers and offered to buy the assets the company had in North Dakota.”

He started Summit Energy Services in April 2010. The company now has an 11,000-square-foot shop on the west side of Williston on 8½ acres in the commercial park. Summit Energy operates more than 70 trucks, 60 pieces of equipment including cranes, skid steers and dozers.

In two years, the company has jumped from six to more than 100 employees and is still hiring. It has seen a 90,000 percent increase in billings since it was founded. Services include pipeline construction, roustabout services and site maintenance, storm water and erosion management, reclamation services, seasonal services and scoria and water hauling.

The gravel crushing business has a lot of potential and is growing, as well as roustabouts and maintenance jobs. One thing that the company has a niche in is oil spill and brine cleanup and remediation.

“We have a good relationship with state and federal agencies,” Sweeney says. “With more volume and more players, it is inevitable there is going to be more accidents, incidents and mishaps. We want to be the company that does it professionally, properly, quickly and be good stewards of the land.”

Will Reedy was hired as the company’s chief operating officer in

I

Last year, Summit Energy Services, headquartered in Williston, N.D., saw 650 percent growth. (Photo courtesy of Summit Energy Services)

44 Prairie Business WND

April 2012

March 2011. He and Sweeney had worked together in Wyoming.

In just a year, Reedy says a lot has changed. “When I interviewed the company was working out of Mike’s garage,” he remembers.

“First week I started we went to a downtown office space with two rooms and two windows.”

He also notes that when he first started it was a huge challenge finding good people and that remains a challenge. “A year ago we had very little name recognition, was a smaller company and it was hard to get people in the door,” he recalls. “We have made huge strides in getting our name out there.”

Summit Energy’s old office was located near the Amtrak train station and Reedy remembers every morning seeing people getting off the train with a backpack looking for work. “I feel for those people,” he says. “It has been a big misconception about the housing difficultly.

Having a backpack in a North Dakota winter is borderline suicide.”

Sweeney adds there is more competition here now. “It has made us tighten our belt,” he notes. “Competition is a good thing.

Producers’ expectations have increased as well. There are more competitive players here. It is a better environment for business all the way around.”

Infrastructure – including finding apartments and homes – continues to be a challenge. It is also tough finding rental equipment.

“We have done our best to create local relationships with people,” Sweeney says. “When Summit comes in we get noticed. We do everything we can to help out local vendors” It is still difficult, Sweeney states. There are times when vehicles have to be taken to Sidney, Mont., or Dickinson or Bismarck or Minot, N.D., for service because of the wait in oil country.

Reedy says the company is cognizant of not over-extending itself on long-term commitments as a way of looking forward to the future. “We like to have a mix. Local labor force dishes out a lot of money to their employees and we’re aware of that. We’re unable to get around it completely.”

As for making sure the company does not have huge growth that cannot be handled, Reedy says it comes down to our field leadership, in particular, the superintendents who do the selling. “We just communicate when it is time to push for more work or we can’t afford more business to lay off. They really deserve the credit to turn it up or slow it down. We don’t have a sales force. It is by design the guys that sell the jobs also complete the job.”

Reedy adds that the bottom line is the company has been fortunate to attract some “amazing” employees who have done a lot of good work for its customers.

“That is what keeps the phone ringing for us.”

Sweeney says that all indications are that business in the Bakken is going to continue to grow. “At what rate, it is debatable by everybody,” he says. “Personally, for Summit, we see another year of growth. Growth is good. Hyper growth is ultimately dangerous if not tended carefully. We expect to grow, expect more demand for our services. We want to continue to be that company to the producers that is called first, the company of choice. Growth or not it all comes from positive customer relationships.” PB Alan Van Ormer - avanormer@prairiebizmag.com

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45

By the Numbers EMPLOYMENT

(NOT SEASONALLY ADJUSTED) UNEMPLOYMENT RATE 1/20/2011 North Dakota 4.5 Fargo MSA 4.6 Bismarck MSA 4.8 Grand Forks MSA 5.0 Minot MiSA 4.7 Dickinson MiSA 2.6 Williston MiSA 1.5 Jamestown MiSA 4.8 Wahpeton MiSA 4.6 South Dakota 5.6 Sioux Falls MSA 5.3 Rapid City MSA 5.6 Aberdeen MiSA 4.1 Brookings MiSA 4.3 Watertown MiSA 5.3 Spearfish MiSA 5.0 Mitchell MiSA 4.6 Pierre MiSA 4.0 Yankton MiSA 5.2 Huron MiSA 4.0 Vermillion MiSA 3.9 Minnesota 7.6 Minneapolis-St. Paul MSA 7.0 Brainerd MiSA 11.8 Winona MiSA 6.8 Fergus Falls MiSA 8.8 Willmar MiSA 7.3 Bemidji MiSA 9.0 Alexandria MiSA 7.7 Hutchinson MiSA 9.9 Marshall MiSA 6.7 Worthington MiSA 5.6 Fairmont MiSA 7.3

1/20/2012 3.8 4.2 3.8 5.1 4.0 2.1 0.8 4.2 4.5 4.7 4.5 4.7 3.8 3.9 4.6 4.9 3.9 3.3 4.1 3.7 3.4 6.4 5.9 10.1 5.3 7.3 5.3 8.2 6.1 8.1 5.3 4.9 6.1

EMPLOYMENT 1/20/2011 347,380 111,936 58,080 51,468 30,906 15,758 19,042 10,768 12,959 411005 121250 61375 22070 17870 17480 12720 12275 12055 10955 9305 7305 2715678 1697257 40,026 25,703 27,351 22,013 21,083 18,043 16,906 13,589 11.069 10,459

1/20/2012 366,846 116,049 59,971 51,164 30,653 17,346 29,933 10,177 13,002 417860 124195 62735 21975 18085 17985 12470 12455 11810 11080 9445 7445 2754428 1725237 42,100 28,092 28,379 22,615 20,928 19,380 18,701 14,383 11,124 10,641

MSA — Metropolitan Statistical Area MiSA — Micropolitan Statistical Area Sources: U.S. Bureau of Labor Statistics, Minnesota Department of Employment and Economic Development, Job Service North Dakota, South Dakota Department of Labor

NORTH DAKOTA OIL ACTIVITY

DEC 2011 NOV 2011 OCT 2011 DEC 2010

Sweet Crude Price/BBL

Production Oil-BBL/day

$88.57 $90.36 $81.89 $81.03

534,880 510,610 487,724 341,990

Drilling Permits 180 169 201 134

DEC 2011 NOV 2011 OCT 2010 DEC 2010

Source: NDIC & NDOMB

Producing Wells 6,471 6,332 6,210 5,331

1/25-27/12 Rig Count

BOARDINGS

Minneapolis-St. Paul Fargo Sioux Falls Rapid City Bismarck Duluth Grand Forks Minot Pierre

1/27/12

U.S. to Canadian Dollar

$0.9809 or $1.0195

$1.0013 or $ 0.9987

$0.9988 or $1.0012

U.S. to Euro

$0.7269 or $1.3757

$0.7580 or $1.3192

$0.7428 or $1.3462

U.S. to Chinese Yuan

$6.5744 or $0.1521

$6.5810 or $0.1520

$6.2976 or $0.1588

U.S. to Japanese Yen

S81.74 or $0.1223

$76.67 or $0.1304

$80.87 or $0.0123

U.S. to Mexican Peso

$12.13 or $0.0824

$12.93 or $0.0774

$12.88 or $0.0776

Source: Bank of Canada

Data provided by Kingsbury Applied Economics

CANADIAN BORDER CROSSINGS

Intl Falls-Rainer Grand Portage Baudette Warroad Roseau

April 2012

TRUCKS

JAN 2012

% CHANGE /JAN 2011

32379 19310 11873 9000 3499

3.96% 3.71 3.02 5.18 10.31

1379 1033 488 1118 629

-19.69 % -11.86 -36.82 -33.36 15.41

JAN % CHANGE 2012 /JAN 2011

18462 5810 4078 4232 4324 2453

0.64 9.40 11.97 19.21 38.86 9.61

17566 8132 867 2282 847 926

4.09 20.72 -8.35 8.61 20.32 429.14

NORTH DAKOTA

Pembina Portal Neche Dunseith Walhalla Noonan

Source: US Customs and Border Protection

46 Prairie Business

- 0.01 2.07 27.60 10.70 11.48 - 5.31 9.94 63.18 -28.29

Source: US Customs and Border Protection

MINNESOTA 2/24/12

% CHANGE/2010-2011

1,130,315 29,608 36,440 15,248 16,221 11,216 10,853 15,262 796

AUTOMOBILES

2/25/11

204

JANUARY AIRLINE BOARDINGS

NOTES: Employment data is based on formulas. Each February formulas are “benchmarked” to correct any economic or cultural changes that may make current formulas inaccurate. At that time figures for previous months may change. North Dakota oil data is also preliminary data and changes may be made at later dates.

CANADIAN EXCHANGE RATE

Rig Count 199 199 197 163