PB May 2011 by Prairie Business Magazine

May 2011

TECHNOLOGY pg 20 Building an entrepreneurial spirit TOURISM pg 24 Affordable destinations

SALES/MARKETING Who are you? pg 40

Community Spotlight: Northern Hills continues to thrive because of the communitiesâ&#x20AC;&#x2122; willingness to cooperate. pg 28

MONEY

Local matters pg 40

LEADERSHIP

Sweat the details pg 43

TECHNOLOGY Planning for the worst pg 7

pg 32

CORPORATE pg 26 EVENTS Are they coming back? ECONOMIC DEVELOPMENT

Is economic development important to you? pg 19

Company Spotlight: EAPC Engineers Architects pg 16

www.prairiebizmag.com

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CONTENTS 6 7 8

Volume 12 No. 5

From the Editor’s Desk Technology – Planning for the worst Professional Spotlight

8 10

Matthew Mohr Prairie News

Prairie People

16 19

Company Spotlight: EAPC Engineers Architects EAPC Engineers Architects has developed a business model that has sustained growth even in hard economic times.

Economic Development – Why Economic Development is Important to You

Cover Story: Building an entrepreneurial spirit with technology

24 26

Cover Story: Affordable destination for tourists in this region

Technology’s capabilities are creating an entrepreneurial spirit through lowering the threshold for cost and allowing people broader range choices of where they want to live.

The message in this region is that it is an affordable destination for tourists.

Cover Story: Events slowly coming back Many communities in the Prairie Business magazine coverage area are finding that corporate and convention events are slowly bouncing back.

A Willingness to Cooperate – The region continues to thrive because of the communities’ willingness to cooperate.

Prairie Family Business Association business awards

Local Matters: Where you bank has a big impact on your community

Sales/Marketing: Who are you?

Question and Answer: Supporting Rural Communities Viewpoint

Leadership and Management: Sweat the Details By the Numbers

4 Prairie Business

May 2011

Now might be the time to hook up to natural gas In small communities around the region there is not enough load to justify large capital expenditures for a local distribution company to provide natural gas to customers and businesses.

Community Profile: Northern Hills, SD

32 36

Finding a niche in frac sand bins

Wherever wind blows…And it just happens to blow in North Dakota

Amber Waves, a Richardton, ND company located in the middle of the Oil Fields of western North Dakota, has found a niche in constructing frac sand bins for sand companies.

Ranking #6 in wind energy capacity, North Dakota is poised as a model for the development of innovative, long-term wind and energy resources in America.

Next Month In June, Prairie Business magazine will showcase Health care, Retail, and Rural Development.

On the air Join Prairie Business magazine Editor Alan Van Ormer and host Merrill Piepkorn on Tuesday, May 10 at 3 p.m. on any Prairie Public radio station to hear more about the May cover story. To listen to Prairie Public, visit www.prairiepublic.org/radio/hear-it-now.

. y t i l i b a i l re

DISABILITY

In times of low unemployment, business cannot afford to lose key personnel. Should a highly-skilled, productive employee incur a disability, business owners and employers need to know that they have resources at their disposal to help keep that person on the job. What DVR can bring to the table for business can have a positive impact on the bottom line. Our featured services are not just employment driven, they cam help business access a growing market segment. ~ Harley D. Engelman, DVR Business Relations/Marketing Director

RECRUITMENT ! RETENTION ~ RESULTS D I V I S I O N O F V O C AT I O N A L R E H A B I L I TAT I O N Recruitment & Retention

ADA Resources

Assistive Technology

for more information visit

or call us at

nd.gov/dhs/dvr/

1(800)755-2745

Rural Services a partner in

From the editor’s desk

For daily business news visit prairiebizmag.com

An SBA Award Winning Publication

What a Start! In February, Prairie Business magazine launched its five topics segment involving Money, Sales and Marketing, Leadership and Management, Technology, and Economic Development. rom the articles that have been written, it is amazing to me how fast business ideas and concepts change in just a month. Imagine what it is like for the business owners that deal with different technological or leadership and management or even money issues every day. The hope was that these five topics would be a way to help our businesses and this region grow. And if it is any indication in these first three months of articles, there is a wealth of information out there that this magazine hasn’t even touched. And that is what we hope to do! Needless to say, we have had a variety of different authors talking about the different topics. We continue to have people who are interested in writing these various topics. And we want more people to continue to write about these topics. The five topics have excitedly expanded our magazine. The authors are knowledgeable and provide educational information on business trends, as well as information on what to expect now and in the future. They are the experts and know what needs to happen for a business to succeed. For me personally, as the editor, it helps me better understand what the business issues are in the three-state region of Minnesota, North Dakota, and South Dakota. The topics provide story ideas, sources, and more importantly, helps our readers have a better understanding of the business community. Again, this is what Prairie Business magazine is all about – a magazine that prides itself on being a catalyst for economic growth in this region, as well as informing, educating, and entertaining business owners and managers. And with your continued discussions on various business topics, this will continue to happen.

Mike Jacobs, Publisher Alan Van Ormer, Editor Scott Deutsch, Sales Manager Tina Chisholm, Production Manager Beth Bohlman, Circulation Manager Kris Wolff, Layout Design, Ad Design

NATIONAL ACCOUNT SALES/GENERAL MANAGER:

Scott Deutsch

701.232.8893 Grand Forks/Fargo/Moorhead/northwestern MN

SALES:

Brad Boyd

800.641.0683 Bismarck-Mandan/ west central ND/north central SD

John Fetsch

701.232.8893 Fargo/Moorhead/eastern ND/western MN

Jeff Hanson

605.212.6852 Sioux Falls/southern SD/southern MN

EDITOR: Alan Van Ormer Editorial Advisors:

701.232.8893 avanormer@prairiebizmag.com

Dwaine Chapel, Executive Director, Lake Area Improvement Corporation; Bruce Gjovig, Director, Center for Innovation; Lisa Gulland-Nelson, Communications Coordinator, Greater Fargo Moorhead EDC; Dave Haan, Director of Public Relations and Digital Development at Lawrence & Schiller; 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 808 3rd Ave. S., Ste. 400, Fargo, ND 58103. 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 bbohlman@gfherald.com

Online: www.prairiebizmag.com 6 Prairie Business

May 2011

Technology

Planning for the worst s businesses rely more on technology, the importance of ensuring technology is “always on” has increased. Business continuity is the peace of mind that when you leave the office and close the doors your operations will continue without interruption. As part of business continuity planning, it is critical to plan for the worst. In Fargo-Moorhead, we think of disasters every spring as we plan for flooding throughout our area. Many businesses maintain backups on tape media and send the tapes off-site regularly to ensure data is safe and secure. However, this just protects the data at the time it is backed up. There are many other questions that should be asked. What about continuing to operate when you don’t have access to your facility? How will your customers call you? How will you recover your accounting software so that you can receive or make payments? One method to mitigate risk is using colocation. Co-location is a facility that allows multiple customers to take advantage of a highly-available infrastructure including power, mechanical and communications. Colocation offers businesses the ability to replicate or host their applications and data in a reliable and secure facility. Choosing the colocation provider is critical. The facility should be backed by multiple redundant Tier 1 Internet carriers, include redundant UPS and generator backup power connections. In addition, the facility should be highly secure with restricted access to both the facility and each customer rack, and allow the businesses to connect to the off-site facility safely and securely through a local fiber or regional managed network, allowing business continuity and satisfying disaster planning requirements. PB

Let’s think big, and see how much your business can grow. You don’t have to be big to think big. Combine your positive outlook with our financial expertise and you have the right ingredients for success. Let us show you how to take your business to the next level. Let’s take action. Your business. Our bank.

CHRISTEL FRITZ Broadband Operations Manager IdeaOne Telecom cfritz@ideaone.com

7 Prairie Business

MARTY MOHAGEN Sales Manager IdeaOne Telecom mmohagen@ideaone.com

May 2011

Call 1-800-908-BANK or visit Bremer.com.

Professional Spotlight

Regional bank president works with industry challenges While working in the banking industry while attending college, Cindi Walsh did not envision it as a career. But because of her interest in money and finance, as well as her strong math skills, and then finding out that banking could take her down several paths, she gave it a try. oday, Walsh is the regional president of U. S. Bank, based out of Aberdeen, SD. She works with the branches in Aberdeen and Mitchell, SD, as well as Jamestown, ND. Walsh says she enjoys every facet of her job. “I enjoy working with my team of employees and helping them grow and develop. I enjoy seeing the difference that we make in customers lives as we help them achieve their dreams. And I enjoy seeing the difference we make in the communities we serve because of our involvement,” she explains. There are also challenges in the banking industry, in particular in how the industry has had to react to the global economic meltdown and impacts of legislation. “This has resulted in more changes in banking than ever, and the challenge is to not only understand and anticipate

CINDI WALSH Regional President US Bank, Aberdeen, SD

what those changes mean, but to help our bankers and customers understand the reasons for the changes,” she says. “Right after the economic meltdown, lending was really tightened as no one knew what was going to happen next. As things have stabilized, that is loosening a bit, with money available to good borrowers for good projects. At the same time, we are seeing businesses and consumers borrowing less, paying down debt, and saving more.” Walsh’s advice to young professionals is to be the best and most productive at what you do, regardless your gender. “Take yourself and your career seriously, and others will too,” she adds. “Try to make a difference in your organization and your community every day. Find something you can be passionate about and it becomes more than just a job.” Alan Van Ormer - avanormer@prairiebizmag.com PB

Business Advice

Growth for growth’s sake Most in business have heard the expression either you grow or you die. In order to provide opportunities for employees’ enrichment, purchase new plant and equipment, or go into new markets, a business needs to grow and be profitable. ome businesses get caught up in the pursuit of growth just for achieving higher sales volume, and, as a consequence, fail to sustain the enterprise. Years ago when discussing business operations with a colleague, he brought up sales and profits per employee. The numbers sounded pretty enticing, and being in a similar business, I checked our sales and profits per employee that year, and looked back over a couple of decades to see if we had improved. Our statistics were comparable, so I thought we had done pretty well. This business friend of mine went on an aggressive growth and acquisition campaign. His business has tripled in revenue and number of employees, but he

S MATTHEW D. MOHR CEO, Dacotah Paper Company mmohr@dacotahpaper.com.

8 Prairie Business

May 2011

recently stated his net profits haven’t grown along with the number of employees. As a result of this recognition, he is now trying to reduce the cost per employee by cutting back insurance, retirement, etc. Had he kept a closer watch on each acquisition, he probably could have tripled his profit along with his revenue, and continued to provide outstanding pay and benefits to all the employees. During challenging economic times, it’s natural to have sales and profits per employee decline, but during periods of growth it is very important to watch these statistics so a business doesn’t lose ground as it gains volume. Growth is necessary and great to have, but each step ahead should be achieved carefully and profitably for everyone involved. PB

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

DAKOTA FOOD EQUIPMENT NOW CULINEX

NATIONAL LAW FIRM OPENS OFFICE IN BISMARCK

Dakota Food Equipment announces its name change to Culinex after more than 60 years. The name change comes as a result of the merger between Dakota Food Equipment and DHA, a commercial kitchen design firm based near St. Cloud, MN. Culinex offers customers one-stop, turnkey commercial kitchen design and supply. The name Culinex stands for a number of things including, Culinary Experts, Culinary Next and Culinary Architects. Culinex will keep its storefronts open in Fargo, ND and Grand Forks, ND. Contract Services, including consulting and design, will be located in Sartell, MN.

Leonard, Street and Deinard are planning to open a new office in Bismarck, ND. This will be the law firm’s fifth location nationwide and the fourth in the Upper Midwest. Others include Minneapolis, Mankato, MN, St. Cloud, MN, as well as Washington, D.C. Jannelle Steger Combs will be a shareholder with primary focus on conducting oil and gas title examinations, advising on title (ownership) rights and preparing drilling, division, mortgage and acquisition title opinions. J. Scott Childs will be an associate. Both will become part of the firm’s national energy practice.

TEREX BID-WELL CONSTRUCTING FACILITY IN CANTON The Terex Corporation’s Bid-Well concrete paving equipment business, an industry leader in the development and manufacture of versatile and specialized concrete paving machines, is building an 80,000 square foot manufacturing facility on an eight–acre site in the Canton, SD, industrial park. Terex Bid-Well has long been an industry leader in concrete paving

equipment with a product line that includes bridge deck pavers and overlay machines, road and airport pavers, texturing and curing machines, work bridges and specialized pavers and graders for slope and canal paving. The new plant is being constructed with a total investment in building and capital equipment of $4.8 million. The company expects to add new employees to its current Canton total of 51 and plans to be using the new facility by November of this year.

AREA HEALTH EDUCATION CENTER OPENING SD FACILITY The South Dakota Area Health Education Center (AHEC) Program Office announced that the “Collaborative for a Northeast South Dakota AHEC” has been selected to establish a second center in Aberdeen, SD. Established in September 2009, the AHEC Program Office is located within the Sanford School of Medicine of The University of South Dakota in Sioux Falls, SD. The Northeast Center Office joins South Dakota’s existing AHEC Center, the Yankton Rural AHEC Center. An independent Board of Directors with broad representation from partnering organizations and communities will oversee AHEC Center programming. South Dakota AHEC is a federally-funded initiative aimed to educate health professions students in medically underserved areas of the state with the goal of recruiting and retaining health care professionals for these communities.

MANDAN HEALTH CARE FACILITY NAMED TOP CARE FACILITY For the second year in a row, Dakota Alpha, a 20-bed residential facility for individuals with a brain injury or a physical disability, earned the highest score possible and was listed as one of America’s best nursing homes by U.S. News & World Report. Dakota Alpha, located in Mandan, ND earned a five-star ranking in each of the three categories rated by Nursing Home Compare, a program run by the federal Centers for Medicare and Medicaid Services and used to determine the annual rankings. Of the nation’s more than 15,500 facilities, Dakota Alpha was one of only 18 in the list to earn the highest 15-star score. Also, Dakota Alpha once again is the only facility in North Dakota to earn a top rating.

10 Prairie Business

May 2011

HANNAHER’S ACQUIRES GAFFANEY’S OFFICE SOLUTIONS Hannaher’s Inc., a 72 year old Fargo, ND dealer of office furnishings and commercial flooring solutions for business and healthcare environments, has acquired Gaffaney’s Office Solutions of Grand Forks, ND. Gaffaney’s Office Solutions has been operating in the region for more than 65 years providing office supply and furniture solutions for their customers. Both Hannaher’s and Gaffaney’s are representing Steelcase, the world’s preeminent office furniture manufacturer and the Office Furniture USA franchise in Fargo and Grand Forks. The new organization employs 32 people between both locations.

ARCHITECT FIRMS MERGE Stahl Architects & Builders of Fargo, ND, and Meland Architecture of Grand Forks, ND, have merged. In addition, Chris Hawley of Stahl Architects & Builders is joining Phil Stahl and Scott Meland as principals of the new company, Stahl Meland Hawley Architects & Builders. Together, the principal partners bring more than 50 years of residential design experience to the tri-state region, and the new company is the largest residential design and build company in the area, according to a press release.

The

percent of Americans

starting businesses in 2009 and 2010 was the

highest in

15 years. Source: Kauffman Foundation

ELEUTIAN TECHNOLOGY OPENING SPEARFISH TEACHING CENTER Eleutian Technology, headquartered in Ten Sleep, WY, is opening the Eleutian Spearfish Teaching Center in Spearfish, SD. Eleutian Technology started in 2006 expanding to numerous locations throughout Wyoming and Utah. The company has more than 300 employees that teach conversational English skills to Asian students via state-ofthe-art video teaching technology. The company is home of the world’s largest workforce of U.S. Certified Teachers who teach English as a Foreign Language to students around the globe.

LAKE REGION BONE AND JOINT SURGEONS MERGE WITH SANFORD HEALTH Lake Region Bone and Joint (LRBJ) Surgeons, P.A. based in Bemidji, MN and Sanford Health have reached an agreement to bring the two organizations together. The Center has been providing orthopedic services to the Bemidji region since 1988. As LRBJ joins Sanford Bemidji’s Orthopedics and Sports Medicine team, they will operate under the legal name of Sanford Bemidji Orthopedics Clinic.

NEWLY RENOVATED FOR

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1635 42nd Street S • Fargo, ND

701-277-9000 www.ramadafargo.com prairiebizmag.com

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

CLEAN COAL TECHNOLOGY BECOMING GLOBAL REALITY

KNIFE RIVER CORPORATION OPENING WESTERN NORTH DAKOTA DIVISION BASED IN WILLISTON Knife River Corporation is planning to open a Western North Dakota Division with full aggregate, ready-mix, asphalt and concrete construction services in Williston, ND, providing private and public work throughout western North Dakota and eastern Montana. Knife River’s Central Minnesota Division operations manager Brad Arntson is the new Western North Dakota Division president. Arntson has more than 35 years experience in the construction industry. The office and all production equipment will be situated on property in north Williston, with plans to have full ready-mix operations available by early May.

AGENERGY BIOREFINERY EVOLVING BASED ON STUDY RESULTS Dakota Spirit AgEnergy, a proposed cellulosic biorefinery near Spiritwood, ND, has evolved from a 20 million gallon per year cellulosic ethanol plant into a 58 million gallons per year ‘hybrid’ ethanol plant. The first phase will be comprised of a 50 million gallons per year dry mill ethanol plant, while the second phase is slated to be an eight million gallons per year cellulosic ethanol addition. The changes are driven by the results of a recently completed “Feedstock Supply and Product Marketing Study” that was funded in part by the North Dakota Agricultural Products Utilization Commission. The ethanol plant would utilize corn to produce ethanol, corn oil, and dried distillers grains. The secondphase plant will utilize corn stover and wheat straw to produce cellulosic ethanol, C5 molasses, and lignin, a boiler fuel.

MATCHING GRANT FUND REACHES MILESTONE College SAVE, the state of North Dakota’s 529 Higher Education Savings Plan, reached a significant milestone by providing North Dakota residents over $100,000 in matching grant funds. The program is designed to encourage individuals who have children who are 12 years old and younger to save money for college. 529 plans offer a variety of tax-advantaged benefits to support students and their families saving for college. College SAVE, administered by the Bank of North Dakota, is the only 529 plan in the nation specifically designed for North Dakota residents. 12 Prairie Business

May 2011

The Energy & Environmental Research Center (EERC) at the University of North Dakota in Grand Forks, ND, and Fujian Longking Co., Ltd., based in Longyan , Fujian, China, are moving forward with site selection and commercial design of the EERC-developed advanced fine particulate control technology to improve global air quality. The EERC Foundation has licensed the technology to Fujian Longking to demonstrate and commercially deploy the technology in China and the United States. The EERC’s advanced hybrid technology allows the removal of fine particles from exhaust gases of coal-fired power plants, incinerators, and mineral-processing facilities. It can also be used in the pharmaceutical and chemical industries.

USD MED SCHOOL RECOGNIZED NATIONALLY The Sanford School of Medicine of the University of South Dakota, located in Vermillion, SD, is one of the top 10 medical schools in the country for its rural medicine program, according to the U.S. News and World Report. The magazine’s ‘America’s Best Graduate School’s 2012’ guide ranks USD’s medical school eighth overall, ahead of the University of North Dakota, in Grand Forks, ND, the West Virginia School of Osteopathic Medicine, and the University of Wisconsin-Madison. The University of Washington was the top-ranked medical school for its rural medicine program. Medical school deans and senior faculty were polled by the publication in electing the best programs in the country.

GLOBAL BUSINESS AWARDS PRESENTED Healthy Oilseeds, a leading American grower, processor, and flax exporter, was named North Dakota’s 2010 Exporter of the Year during the Global Business Connections two-day international business conference in Fargo, ND. Healthy Oilseeds, based in Casselton, ND, is a second generation family farm and has grown flax and borage for more than 50 years. Bremer Bank, headquartered in St. (L-R) Gov. Jack Dalrymple, Brock Gussiaas and Paul, MN, was Roger Gussiaas, both with Healthy Oilseeds and Gussiaas Family Farm Inc. (Photo courtesy of Legacy named North Photography) Dakota’s 2010 Service to Exporters Award. The award is given to an organization that demonstrates an exceptional commitment to increasing the Gov. Jack Dalrymple, John Novak and Ray state’s international (L-R) Grefsheim, both with Bremer Bank (Photo courtesy of Legacy Photography) business.

Prairie People

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.

ULTEIG HAS TWO NEW HIRES

JOEL MARCUSON

CRAIG ANDERSON

Ulteig, headquartered in Fargo, ND, has two new hires. Craig Anderson has been named Vice President of Business Development, while Joel Marcuson is now Ulteig’s Vice President of Transportation. Anderson brings more than 15 years of engineering industry and business development experience. In this newly created role, Anderson is responsible for leading the business development program for the engineering, planning, and surveying company. This program will be central to advancing Ulteig’s strategic growth initiatives. Marcuson brings more than 30 years of traffic engineering, intelligent transportation systems (ITS), and public agency experience to the company. Marcuson’s experience includes traffic engineering for three major U.S. cities, a role in which he was in charge of signal system operations and the implementation and expansion of computerized traffic signal systems.

CORELINK PROMOTES SLABY

JEFF SLABY

14 Prairie Business

Jeff Slaby has been promoted to vice president of Finance and Human Resources for CoreLink Administrative Solutions in Fargo, ND. He previously worked as CoreLink’s controller. As vice president of Finance and Human Resources, he is responsible for providing leadership for CoreLink’s finance, accounting and human resources functions. Slaby joined CoreLink in July 2010. Before that, he worked at Cargill for 14 years as a member of the leadership team that established and led the Cargill North American Financial Service Center located in Fargo. Slaby has more than 20 years of experience working in industries such as public accounting, manufacturing and distribution, health care and shared services. He has held various financial and management leadership positions within these companies.

May 2011

LADDER OF SUCCESS IS BEST CLIMBED BY STEPPING ON THE

RUNGS OF OPPORTUNITY. THE

-AYN RAND

WELLS BECOMES PRESIDENT, CEO OF MDU RESOURCES’ NATURAL GAS & OIL PRODUCTION BUSINESS

J. KENT WELLS

MDU Resources Group, Inc., based in Bismarck, ND, has hired industry veteran J. Kent Wells as President and Chief Executive Officer of the corporation’s natural gas and oil production business, Fidelity Exploration & Production Company. Wells’ extensive experience spans more than 30 years with BP and Amoco, including responsibility for BP’s U.S. onshore natural gas business. He will report directly to MDU Resources president and chief executive officer Terry D. Hildestad beginning May 2 and will be based in Fidelity’s Denver headquarters.

SMALL BUSINESS DEVELOPMENT CENTER REGIONAL DIRECTOR HONORED

RAY ANN KILEN

Ray Ann Kilen, Regional Director of the North Dakota Small Business Development Center and CEO of Innovative Environmental Consultants, Inc., has been named the SBA’s 2011 North Dakota Women in Business Champion of the Year. The award recognizes individuals who have demonstrated a commitment to support the advancement of women’s business ownership. As the Southwest Regional Director, located in Dickinson, ND, Kilen shares her business experience to assist other business owners with business plans, financial plan development, and registrations with state and federal contracting programs to increase market opportunities.

BASIN ELECTRIC CEO, GENERAL MANAGER ANNOUNCES RETIREMENT

RON HARPER

Ron Harper, Basin Electric CEO and General Manager, is retiring at the end of 2011. Harper assumed his duties at Basin Electric, headquartered in Bismarck, ND, on April 23, 2000. He brought nearly 30 years of experience working with electric distribution cooperatives to Basin Electric. When Harper joined Basin Electric in 2000, Basin Electric owned 2,370 megawatts (MW) and operated 3,323 MW of generation for its 118 member systems and others. When he retires at the end of the year, Basin Electric will own 3,333 MW and operate 4,424 MW for 135 members and others. Another 300 MW of generation, the combined-cycle gas-fired Deer Creek Station, near Elkton, SD, is under construction and expected to be operating in 2012. The assets of Basin Electric will have grown from $2.3 billion in 2000 to $5.4 billion at the end of 2011 under his leadership.

prairiebizmag.com

Company Spotlight

EAPC Engineers Architects

EAPC ENGINEERS ARCHITECTS FACTS: Headquartered in Grand Forks, ND, EAPC has been providing services since 1967. EAPC is owned by six partners in the firm and employs a staff of nearly 100 professionals. EAPC has offices in Fargo, Bismarck, Minot, Williston, Bemidji, Norwich, VT, Boston, MA, and Buenos Aires, ARG.

Business model that provides sustained growth EAPC Engineers Architects has developed a business model that has sustained growth even in hard economic times.

EAPC was named as one of the 200 fastest growing architecture, engineering, and environmental consulting firms in the country in 2008 and again in 2009.

he engineering and architecture company, headquartered in Grand Forks, ND, opens an office with a core group, then adds employees until that office becomes sustainable. The latest venture is starting in Williston, ND. “We have to continue to diversify and have to reinvent ourselves to stay ahead of the competition,” states Alan Dostert, President and CEO of EAPC. “Marketing and establishing our public presence has always been important, but has become even more important as the slack market in large regional metro areas has pushed large architecture firms into the tri-state region.” EAPC is a full-service consulting firm offering architectural, engineering, wind energy consulting, interior design, and construction management services. EAPC is privately owned by six partners and employs nearly 100 professionals. There are offices in Fargo, Bismarck, Minot, and Williston, and also in Bemidji, Norwich, VT, Boston,

16 Prairie Business

May 2011

EAPC is comprised of three sectors: Building, Industrial, and Wind Energy.

MA, and Buenos Aires, ARG. Dostert states that the success over the past 10 years, and other market and industry trends, has led to a resurgence in sustainable design. “Sustainable design is something that we have always done a good job with,” he explains. “The last 10-15 years we have added talented designers to our staff. We rely on professionally-trained staff.” Dostert believes the watershed moment for EAPC came in 1997 when the Grand Forks flood hit. It required EAPC to increase the number of employees from 50 to 70 people to help rebuild the community. “We’ve seen sustained growth from that time on,” Dostert states. EAPC expanded to Fargo and then found other opportunities in other communities in the region. In the past six years, EAPC has steadily been around 100 employees mainly because the company was able to provide services for several large projects.

Company Spotlight “This year and going forward, we are seeing a large volume of work, but seeing jobs of smaller sizes in the Fargo market, but larger projects in the Grand Forks market, for example,” Dostert states. What also sets the company apart from other engineering and architecture firms is being comprised of three uniquely different, but yet integrated sectors: Building, Industrial, and Wind Energy. Dostert is one of the partners in charge of the building services sector, which in most architectural and engineering companies, is considered mainstream architectural design. In EAPC’s case, the building services sector is a one-stop shop for building services and meshes well with the other two sectors. It is also what EAPC was founded on 44 years ago. “The Building sector is our roots,” Dostert explains, adding that Building services accounts for one-half to two-thirds of the total volume of the company. Health and wellness work is a key portion of the Building Services sector. The company has provided these services for the community of Grand Forks, Minot State University, Jamestown College, North Dakota State University, and South Dakota State University. “We understand the needs and the technology,” Dostert says. “It becomes much easier to market.” In addition, the Building Services sector provides services in hospitals, clinics, nursing homes, and has found a little niche in fire stations and related public works response facilities, religious projects, multi-family housing, and assisted care and skilled care nursing facilities. The major challenge is competition because of a depressed economy in EAPC’s marketing area that includes North Dakota, western Minnesota, northern South Dakota, and eastern Montana. “There are people very desperate for work,” Dostert explains. “The architecture profession was hit probably the hardest of any professional group, especially in the Midwest.” Dostert says he has heard numbers as high as 35-40 percent unemployment of registered architects, adding that the American Institute of Architects (AIA) recognizes unemployment in the 28-35 percent range. “We used to have six to 10 regional firms after a larger project,” he adds. “Now we may have as many as 20. Competition has become fierce.” EAPC’s newest sector is the Wind Energy Division. In the past 10 years, the company has been involved in more than 30,000 megawatts of projects, including most of the wind farm development in North Dakota. EAPC is also involved in projects across the United States, Canada, and in Uruguay, Argentina, and Chile. “The Wind Energy Division brings in a significant portion of revenue and is a profitable sector,” states Jay Haley, Mechanical Engineer and a Partner in charge of this sector. “It lends diversity to this company that a typical architectural firm wouldn’t have.” This has led to niche market services for structural engineering and civil engineering portions of the Building Services sector. When Haley joined the firm 10 years ago he already had a decade of experience in the wind energy industry. The first eight years EAPC did not have to do any marketing, as the work came from word-of-mouth advertising. The last couple of years the company has decided to go out and market its Wind Energy sector in order to facilitate growth. The sector is also unique because of its software sales. “In this business there is not a lot of common industry software to do our job,” Haley explains, adding that EAPC sells and uses the two most widelyused tools, WindPRO and Meteodyn, and is also the sole North American sales and technical support provider. EAPC also trains others to use the software. This software allows EAPC to do three dimensional models of wind farm sights, as well as determine where to place prairiebizmag.com

Company Spotlight

EAPC Engineers Architects

turbines and other pieces of the wind farm. Power marketing and politics are the two largest challenges for the Wind Energy sector. “We are not in control of these aspects,” Haley explains. “It makes it tougher to look into the future and plan. So far, even when there was a two-year downturn in the industry, our consulting work has never slowed down or phased out.” The third sector within EAPC is the Industrial Services Group. This group provides engineering, design, construction management and maintenance planning for plant shutdowns. Industrial sectors to which the group provides these services is broad. It includes agricultural processing, food, electrical power generation, minerals and mining, gas processing, manufacturing, central heating and chiller plant and distribution systems for facilities in these sectors and those associated with university campuses and medical complexes. This sector has also been very actively involved in the biofuels industry which had a significant impact on the growth and revenue of EAPC from 2001 until 2008. Engineering services provided to these varied industries has included mechanical, chemical, electrical including instrumentation and controls and structural/civil. The Industrial Services Group engineers a wide variety of systems common to plant owners within these various industries. Services are

18 Prairie Business

May 2011

provided to regional, national and international projects. “We play a significant role in ensuring the viability of our entire organization,” states Paul Prout, Vice President, Partner, and Mechanical Engineer in charge of the Industrial sector. “We are not as visible to the public, but we share a lot of the same resources as the other two sectors. We all provide design services and technical consulting in our areas of expertise.” What makes the Industrial sector unique is that it typically provides services to privately owned organizations. In many cases, the company does not advertise publically. “Those who need our services know who the service providers are and we try to build an awareness of who we are by directly marketing to them, being at appropriate trade shows and conferences and networking,” Prout explains. “Our customers tend to be well educated in their technical areas. We try to provide a team of resources to them that they don’t normally keep in house.” The major challenge is finding work. “In this region there are only a small number of owners that need services that we provide,” Prout says. “Our goal is to ensure that we maintain a good long term relationship with our clients, who are nearly always repeat clients, by always doing the best possible work.” Alan Van Ormer - avanormer@prairiebizmag.com PB

Economic Development

Why Economic Development is Important to You Much discussion had been had and more than a few books have been written discussing the demographic shifts throughout the country as people and businesses increasingly look to larger population centers for their permanent homes. Availability of services, cultural and personal amenities, and greater opportunities are often cited as the reasons why. And it is exactly these reasons that many communities reflect upon when developing a good economic development program. hile many people only associate economic development with chasing big companies to come to your town, a solid strategy for the growth of any community follows the simple recipe cited above to keep their current businesses and people in place while steadily adding to them. The ingredients take on many names and embrace many fads but at the end of the day the key word is growth. While growth of opportunities means different things to different people, it generally begins and ends with jobs. Primary job creation is at the heart of economic development and is what successful programs measure themselves by. Primary jobs that offer solid permanent opportunities for workers at all levels of the employment spectrum, and that offer benefits and opportunities for advancement are the heart and soul of every successful community.

W JEFF ECKHOFF Executive Director Lincoln & Minnehaha County Economic Development Associations jeff@siouxfalls.com

These are the jobs that will bring new people to town, keep your current citizens in place and provide the customers for your retail, entertainment, and health care services. The companies that employ them, both large and small, add to your tax base, and create a demand for services that would not otherwise exist. These same companies support your schools and keep people in town that in turn shop locally, volunteer, and fill your churches and schools. And finally these new people with new ideas will directly and indirectly create new opportunities and experiences that will make your community a destination. So as the story of outmigration continues to be written you have a chance to write your townâ&#x20AC;&#x2122;s epilogue. Hereâ&#x20AC;&#x2122;s hoping it is one that celebrates the growth of new businesses, new cultural opportunities, and a city vibrate with optimism. In other words, a community that understood and embraced economic development. PB

prairiebizmag.com

TECHNOLOGY

COVER STORY

20 Prairie Business

Building an entrepreneurial spirit with technology Technology’s capabilities are creating an entrepreneurial spirit through lowering the threshold for cost and allowing people broader range choices of where they want to live. “

hen high speed technology gets into the rural areas it evens the playing field,” states Don Macke, Co-Director for the Center for Rural Entrepreneurship, an organization that works with regions and communities to build strategies to grow their economies. Macke, based in Lincoln, NE, estimates that there are 10 million more self-employed entrepreneurs in the past decade. In addition, research suggests in 20 years, 25 percent of all American’s will be self-employed working in this remote, contract industry.

May 2011

“This suggests a potential shift of how we will be living in the future,” he explains. “Some industries are already fashioned that way. More people are going to be freelance working as entrepreneurial.” Delore Zimmerman, Director of the Red River Valley Research Corridor in Grand Forks, ND, says technology is a network-centric economy and teaming is the new skill that everyone needs to learn and become adept at doing quickly and effectively. “Technology enables individuals and small teams to accomplish what used to take place oftentimes in the realm of only the biggest companies,” he

explains. “The hurdles for making big ideas a reality from small beginnings are eroding in many sectors of the economy. Knowing that this is the case emboldens people and empowers them to be entrepreneurial.” John Jasper, Founder of Bolder Thinking LLC, based in Chicago, IL, provider of the first and only cloud-based enterprise-grade telephony platform for call centers and businesses, says that we are in the middle of one of the broadest, most transformative technology revolutions ever. Bolder Thinking has a development center in the North Dakota State University Research Park. Jasper also formally ran a company called SEI, which has a large presence in Fargo. “Every day innovations are being brought to market that are substantially impacting the way we work whether we are in marketing, production, finance, or management,” he says. “While mobile devices already have changed our personal lives, they are only beginning to realize their potential to dramatically impact business operations, regardless of industry.” Many organizations continue to work to keep up with the technology changes. Paul Baumgartner, Sales Manager of Network Center, Inc., in Fargo, ND says there is little doubt that advances in technology will change every aspect of how we work as well as where we work from. “The day will come when

we no longer need to get up and go to work, we will just work. Work will not be a destination for many of us, it will be an activity,” he adds. “We will continually see improvements and cost reductions in bandwidth, computing power/cloud computing, connectivity, and collaboration technologies. Today’s technologies are laying the groundwork for tomorrow’s workplace.” Results Unlimited, a marketing company based in Minot, ND, continues to be on the cutting edge of technology. “You have no reason to cling to old technology,” states Rod Wilson, Owner/Partner of Results Unlimited. “When you are starting new business, one of the first investments will be to stay on the leading edge of technology.” Wilson adds that entrepreneurs are willing to go out on a limb to take a risk on new technology. “They take pride in what they have accomplished. But, technology will normally set the pace of the business,” he says. “Staying on the edge of new technology is very entrepreneurial. Entrepreneurs are very tech savvy.” Jasper says that when you look at combined potential opportunities across the different technological areas and imagine things differently in the workplace, you immediately find that there are still a wide range of opportunities to help small, medium, and large businesses to function differently.

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prairiebizmag.com

COVER STORY

TECHNOLOGY

“Companies that fail to adapt to the new cloud-based, socially and mobile mode of operation will be at a significant disadvantage to other companies,” he states. Jasper adds that Open Source technologies can enable startup companies to get up and running in a fraction of the time that new businesses have launched in the past. “Traditionally, building the underlying technology for software or web-based businesses would have been quite complex,” he explains. “Given the strength of the technology available in the Open Source community, a company can be conceived and launched in under a year with minimal initial capital. This makes entrepreneurship more viable and attractive to innovators across the globe.” Midcontinent Communications provides networks across South Dakota and North Dakota, while Dakota Carrier Network operates a system in North Dakota. Both are seeing changes in what is needed to provide that network to their customers. Tom Simmons, Senior Vice President of Public Policy for Midcontinent Communications, headquartered in Sioux Falls, SD, says for many years companies became really engrossed in the buzzwords and people were concerned about broadband capacities and those issues relating to broadband capacities. “What it is really about is applications,” he says. “The simple fact that we will be able to do everything that we need to do in a variety of places will make a difference.” Simmons adds that offices are overloaded with technology; some being proprietary dedicated to the computer A Little More Flexible.

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industry. “Other is generic that allows us to connect to with other individuals,” he says. “We all need to be technologists from the standpoint of the applications that we need to do our job.” At Dakota Carrier Network, headquartered in Fargo, ND, General Manager Evan Hass has seen it all in the technology field. He explains that a key part of DCN’s business is commercial business and he uses rural banks as an example. Rural banks have expanded their business connect multiple locations around the region using wide area networks for administrative functions, phone systems, internet access, and data storage. “I see this as a big change,” he says. “They represent everything businesses are doing to stay competitive.” DCN provides customers with connections and bandwidth. “The increased demand for bandwidth on our network has been very significant,” Hass says. “That tells me that our network infrastructure will continue to expand to provide the growing demand for broadband capacity and new services. From the business aspect, the expanded bandwidth allows them to be more efficient, more effective, and provide better quality service.” Wilson says what technology has done has allowed all companies, large or small, in any location, to expand their marketplace. “The most important cog in the technology wheel is communication, which as we all know, has become larger in scope to include national and international markets,” he explains. “Innovative products developed for one industry can quickly be adapted and marketed to other industries and markets. Many businesses find themselves partnering or collaborating together to provide a product that answers the

JOB SECTOR PERCENTAGES

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16%

19.3%

63%

15.3%

15.6%

16.1%

19.3%

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May 2011

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Dan Koeck/ND Tourism

needs or an industry or region.” Simmons adds that technology is going a long way down the road to help foster independent spirit. “The independent nature that we have and the way make decisions and communicate independently, open the door for independent thinking, which is the basis for an entrepreneurial spirit,” he adds. “I don’t think that is all bad. It is the backbone of this country’s development and probably our best hope for development more likely on a small business side than a large business side.” Macke states that clearly, the internet is transformational. In so many ways, reducing the isolation that historically has prevented economic activities occurring in certain geographies, he explains “It opens up opportunities for economic and business development in places that weren’t historically possible in the past,” he says. “It is changing in the amount of work we can do electronically. People are becoming more comfortable having personal relationship through technology. In the past people would not have engaged with if they did not sit across the table from us.” Alan Van Ormer avanormer@prairiebizmag.com PB

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TOURISM

COVER STORY

24 Prairie Business

Affordable destination for tourists in this region The message in this region is that it is an affordable destination for tourists. he top reason travelers come to North Dakota and South Dakota is for an outdoor experience. Then add business and leisure in North Dakota and culture and history in South Dakota, tourists have the makings for an enjoyable and affordable trip. In Minnesota, outdoors and natural resources are historically top draws that attract visitors. Tourism leaders will tell you that Minnesota is a very diverse state that offers attractions in every corner of the state. Costs do impact travelers, however, tourism leaders have not seen any indication that fluctuating gas prices or increased hotel costs have slowed down visitors. “The main areas we measure we determine impact tourism is where the tourists spend their money,” explains Sara Otte Coleman, Director, North Dakota Tourism. “These include food, shopping, accommodations, transportation, and entertainment in that order. Transportation is significantly less than the top three categories.” South Dakota Department of Tourism Director Jim Hagen said costs vary from family to family. “First, they look at budget and gas prices,” he says. “Number two they look at destination itself and take a look at the overall cost of taking that vacation.”

May 2011

John Edman, Minnesota Director of Tourism adds that the record high gas prices we’re experiencing this year could influence travelers this summer, but the specific impact is hard to predict. “For the last couple of summers, consumers have adjusted to the higher prices after the initial sticker shock and kept driving. Most people are not giving up their summer vacations because of gas prices,” he states. Minnesota is seeing a continued period of slow gradual recovery. “Lodging occupancy and revenue have increased over the last year, but consumers are still concerned about the economy and discretionary spending,” Edman states. “Travelers are staying closer to home, making decisions more at the last minute, and seeking value vacation experiences.” In North Dakota, Coleman doesn’t feel that 2011 will change and the state will not change its marketing focus because of the economy or gas prices. “Our research has said that we need to focus closer to home,” she states. “That helps position us really well for this economic downturn because we have been very consistently in Minneapolis and Milwaukee since 2003. They are aware of us. When the economy crumbled, because we had been there, they thought about North Dakota as an affordable alternative.” The South Dakota tourism industry also focuses on surrounding states including Minnesota and Wisconsin. “We have targeted our advertising to these regions especially because of the way the economy is. Our partners have followed that lead also,” Hagen explains. “One of our goals is to provide more information to major attractions through the entire state as to why we are going into a certain market.” Education has been key for the tourism industry. All have developed a theme that is remembered by tourists. South Dakota’s is ‘Great Places, Great Faces.’ North Dakota counters with ‘Legendary.’ Minnesota is currently embarking on a campaign of “More to Explore” in Minnesota. “Travelers are eager to discover more of what there is to do in their own backyard,” Edman explains. “This campaign builds on the existing Explore Minnesota campaign, emphasizes the variety of state offerings, and even uses local celebrity Joe Mauer in some fun new tourism ads.”

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Hagen says that focus groups show that when people think of South Dakota, Mount Rushmore is the first attraction that pops into mind. “I think you need to have a brand that sticks in people’s mind. No question, ‘Great Places, Great Faces’ is short and you get the picture and you get the message,” he says. The ‘Legendary’ campaign has done the same for North Dakota. “Legendary was built on the research that we are not necessarily known for landmarks, but known for our legends, our history, and our culture,” Coleman explains. “We’re a very diverse state. Legendary works well to market the entire state.” Alan Van Ormer - avanormer@prairiebizmag.com PB

SARA OTTE-COLEMAN Director North Dakota Tourism

JOHN EDMAN

JIM HAGEN

Director Minnesota Department of Tourism

Director South Dakota Department of Tourism

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CORPORATE EVENTS

COVER STORY

26 Prairie Business

Events slowly coming back Many communities in the Prairie Business magazine coverage area are finding that corporate and convention events are slowly bouncing back. n Sioux Falls, SD, Convention and Visitor’s Bureau Executive Director Teri Ellis Schmidt says there was not a huge dip during the economic downturn, but Sioux Falls saw enough to take notice. “We know that our hotels, along with the CVB, have been working hard to reenergize our corporate market share,” she says. “It is going to take time, additional hard work, creative planning by both the planners and city and facilities, and the continuation of a healing economy.” In Bemidji, MN, VisitBemidji! Executive Director Denelle Hilliard is hoping that the new Sanford Center will help the community grow its events. “With the potential of the Sanford Center, we can’t see anything but positive,” she says. “We have a competitive edge here in Bemidji to host greater meetings.” And in the Fargo-Moorhead area, President and CEO of the Fargo-Moorhead Convention and Visitor’s Bureau, Cole Carley is seeing that travel industry economy has a strong

May 2011

base in all events including meetings, conventions, sports tournaments, special events, and festivals of all kinds. “During the economic meltdown, we saw a sharp drop off in corporate travel and business meetings,” he explains. “That was unfortunate, not just for us, but for the businesses that cut back because a recent study by Oxford Economics shows that long-term profits eventually decline for businesses that cut back on travel in the short term.” Carley says that fortunately, the association meetings, athletic events, and other event-oriented travel in the area had strong attendance that helped the travel economy blunt the effects that ravaged the industry elsewhere. In the Bismarck-Mandan area, sporting events, as well as government-related conventions are increasing. “Meeting planners are looking at smaller venues,” states Terry Harzinski, Executive Director of Bismarck-Mandan Convention and Visitor’s Bureau. “We’ve always promoted or used as a selling point that we are an affordable place.

Another change, which is the same with CVB’s across country, is tremendous opportunities in sports marketing. Sports marketing is lucrative for any size community in the country.” South Dakota’s state capital is seeing an increase in state association meetings because of its location in the middle of the state. “Everyone is watching costs,” states Lois Ries, Pierre Convention Visitor’s Bureau Director. “There are more one or two day conferences and even holding conferences over a weekend, instead of meeting for a week.” Because of the Alerus Center and Canad Inns Destination Center complex, Grand Forks, ND is able to host various size conferences. In fact, between 2009 and 2010, the Greater Grand Forks Convention and Visitor’s Bureau saw a 15 percent increase in bookings, says Julie Rygg, Executive Director of the Greater Grand Forks Convention and Visitor’s Bureau. “We are seeing some groups not holding as many meetings and combining more, but we have also experienced more groups willing to move around the state instead of staying in one place every year,” she says. Rapid City, SD hosted nearly 300 conventions and events in 2010. Michelle Lintz, Executive Director of the Rapid City Convention and Visitor’s Bureau, says that many are bringing families because they are already traveling for business. “Many times they choose to plan a vacation here with the time they TERRY HARZINSKI Executive Director have,” she states. Bismarck Mandan Alan Van Ormer Convention and avanormer@prairiebizmag.com PB Visitor’s Bureau

North Dakota’s #1 Vacation

LOIS RIES

DENELLE HILLIARD

MICHELLE LINTZ

Director Pierre Convention and Visitor’s Bureau

Executive Director VisitBemidji!

Executive Director Rapid City Convention and Visitor’s Bureau

JULIE RYGG

TERRI ELLIS-SCHMIDT

COLE CARLEY

Executive Director Greater Grand Forks Convention and Visitor’s Bureau

Executive Director South Dakota Convention and Visitor’s Bureau

President/CEO Fargo-Moorhead Convention and Visitor’s Bureau

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prairiebizmag.com

Community Spotlight

Northern Hills

Downtown Deadwood, SD. (Photo courtesy Deadwood Chamber and Visitor’s Bureau.)

A willingness to cooperate Your first thought about the Northern Hills might be all the beautiful scenery and the tourism opportunities that are abundant in the 100-mile area that encompasses communities on the high plains and in the hills of western South Dakota. owever, the region continues to thrive because of the communities’ willingness to cooperate. “Cooperation is unique amongst this group,” states Chuck Turbiville, Executive Director of the Deadwood Economic Development Corporation. Michele Loobey-Gertsch says the communities in the Northern Hills all recognize tourism is an open market that we should be focusing on. “The Black Hills is a 100 miles of tourism opportunities,” she explains. The Northern Hills consists of six communities that all have their own niche. Belle Fourche is the southern-most city in the region, located on the plains of western South Dakota. It is an ag and ranch community and a sole-proprietorship based community. Lead is the northern-most community, located in the Black Hills of western South Dakota. For 126 years, the community was known for the Homestake Gold Mine. Now, the mine is being used as an underground science and engineering lab. There are four other communities that all have their own make up. Deadwood is big in tourism and gaming, while Spearfish has the largest increase in population growth because of an increase in retail and health care. Sturgis, most notably known for the annual Sturgis Bike Rally in August, has realized the opportunity to become a retail hub. Whitewood is also part of the mix. “It is the diversity that holds the Northern Hills together,” explains Teresa Schanzenbach, Executive

28 Prairie Business

May 2011

Director of the Belle Fourche Chamber of Commerce. “We don’t have that jealous competitive nature. We know that what is good for one community is good for another.”

BELLE FOURCHE ROLLS WITH THE FLOW Since the community is mostly ag and ranching, Belle Fourche has seen its highs and lows over the years. “We have maintained nicely through ups and downs of the economy,” Schanzenbach states. “Part of it is an attitude. We take advantage of what is put before us and take the challenges head on and make the best of them.” Recently, the community expanded Highway 85, a main thoroughfare from the community to Highway 90 (the major route that runs throughout South Dakota and into Wyoming and points further west). In addition, the community takes advantage of being known as the geographical center of the United States. Further plans include the development of a 110-acre industrial park that will lie along existing rail. The Center of the Nation Wind Farm anticipates construction in 2012. “We are tapping into energy and transportation,” says Schanzenbach, adding that the community is positioning itself to provide ancillary services needed for the oil and gas exploration already taking place in its northern neighbor, Harding County.

DEADWOOD MORE THAN JUST GAMING AND TOURISM There is no question that Deadwood is impacted by

Community Spotlight gaming and tourism, which is impacted by economic conditions around the country and in the state. For example, a recent smoking ban will have an effect on the gaming industry, states Turbiville. Deadwood is trying to fill holes in the community with retail and more conventions and entertainment. “We have shifted our focus to the history of Deadwood and the Black Hills as an experience,” explains George Milos, Executive Director of the Deadwood Chamber of Commerce. Most recently, the Lodge of Deadwood Roughlock Falls opened and another major convention and entertainment facility is expected to open in July. “This is a brand new opportunity for Deadwood in the entertainment and convention business. Now we can create new events,” Milos states. “People can gamble almost anywhere in the nation. We have to be different. We have to be unique.”

LEAD MOVING PAST GOLD MINING DAYS For almost 130 years, the Homestake Gold Mine had a major impact on what occurred in Lead. Many will admit that since Homestake closed in 2001, the community was in a sort of great Sanford Lab in Lead depression. Now, with the opening of the underground science and engineering facility, the community is springing forward to diversify its economy. “This is a big part of our future,” states Melissa Johnson, Executive Director of the Lead Area Chamber of Commerce, adding that the future also includes outdoor recreation including snowmobiling, skiing, fishing, hiking, and golfing. “We’re building back up. The community is looking at redeveloping and redesigning downtown area. It has been a tough road for us, but the people are pretty resilient.” In order for it to work, Johnson believes Lead is going to have to work together with its neighbor a few miles down the hill in Deadwood. “Lead can Belle Fourche provide more retail and specialty stores for people visiting our neighbor Deadwood as a complement to the gaming industry,” she says. “We’re optimistic. We’re not going to rely just on the lab. We are going to make sure we tap into other resources available. Northern Hills is very bright for all of us. We don’t stop in September. We go year around.” Deadwood

prairiebizmag.com

Community Spotlight

Northern Hills

SPEARFISH CONTINUES TO GROW Spearfish has grown in population 22 percent since the 2000 census. In addition, business and job growth has increased four percent in the local area. Most of that growth is seen through light manufacturing, Black Hills State University and health care. People continue to move into Spearfish from outside the area. And when they do move to the area, they continue to travel to destinations around the country. For example, there are citizens who teach at universities on the East Coast and Chicago, and fly to their respective universities for a couple of weeks and then fly back. “People who move from outside our area attribute it to our quality of life,” says Lisa Langer, Executive Director of the Spearfish Area Chamber of Commerce. One setback occurred when the well-known Black Hills Passion Play ended. Now, the community is looking to find someone to purchase the facility, renovate it, and operate it as an entertainment center. “Tourism never left, mainly because of Spearfish Canyon and all the outdoor adventure tourism associated with the adjacent Black Hills National Forest,” Langer states. “It’s more that tourism has slowed a bit with the loss of that internationally known anchor attraction.” Spearfish is also growing in the retail and health care field. “We are really the place in the northern hills to come for health care, big shopping (other than Rapid City, which is located about an hour’s drive to the east). I see that continue to grow,” she says. “We’re pretty optimistic in both population growth and retail growth.”

STURGIS CONTINUING TO EXPAND ON BIKE RALLY

Loobey-Gertsch, Executive Director of the Sturgis Chamber of Commerce and Visitor’s Bureau. “We are located in such a great spot.” Sturgis sits on Interstate 90 on the southern end of the Northern Hills, but is centrally located to all of the other communities in the Northern Hills and only about a half hour from Rapid City, SD. Along with the consistency of the summer bike rally, what is also exciting for the community is their dive into the gun industry. Economic development leaders are making scouting trips across the United States seeking specific business types to compliment industries currently within the industrial park. Also, Sturgis is becoming involved with a wind farm. “When people come here for the first time, they are shocked,” LtoR: Teresa Schanzenbach, Lisa Langer, Melissa Loobey-Gertsch states. Johnson, Michelle Loobey-Gertsch, George Milos, “They have no idea of Chuck Turbiville what we all have to offer.” Alan Van Ormer - avanormer@prairiebizmag.com PB

Three years ago, Sturgis recognized a need for more retail and started ‘Future Sturgis’, focusing on five different areas including retail and economic development, tourism, and community pride. “This is an important component to redeveloping Main Street,” states Michele

Northern Hills Facts: Belle Fourche (French for ‘beautiful fork’) was named by French explorers when this area was owned by France, for the confluence of what is now known as the Belle Fourche and Redwater Rivers and the Hay Creek. Deadwood is named for the trees found in its gulch. Lead was officially founded on July 10, 1876, after the discovery of gold. The area (around Spearfish) was used by Native Americans who would spear fish in the creek (hence the name of the creek and subsequently the town.) Sturgis is most famous for being the location of one of the largest annual motorcycle events in the world. Source: Wikipedia 30 Prairie Business

May 2011

117 23rd Street N • Fargo, ND 58102 www.abbusiness.com 701-235-5217 • 800-477-2425

Awards Prairie Family Business Association presents Regional Family Business Awards The Prairie Family Business Association, an outreach program of the Beacom School of Business at the University of South Dakota in Vermillion, SD, presented three prestigious awards during the 19th Annual Prairie Family Business Conference Award Banquet in Sioux Falls, SD. Honored as the “Heritage Family Business of the Year”, the Vojta family of Prairie Berry Winery in Hill City, SD has been making wine from the berries collected on the prairie for five generations. The families passion for wine making started near Mound City, SD, where Great- Great Grandma Anna Pésa Vojta first made wine from the “prairie berries” she found growing nearby. Anna and her husband Josef settled in the Dakota Territory after arriving from Moravia (Czechoslovakia) in 1876 bringing their winemaking with them from the “old country.” The first Vicki Clarke Prairie Family Business of the Year Award, endowed by the Clarke family of County Fair Foods in Mitchell, SD, and established in memory of Vick Clarke was presented to the Duemeland family of Dumelands Commercial in Bismarck, ND. Fifteen local family business award winners throughout the region were considered for this award. Duemelands Commercial’s roots go back to 1905 when four Patterson brothers and George A. Duemeland founded the Patterson Land Company. For $1 per acre and only 10 cents down, the group bought more than one million acres of railroad land between Bismarck and Jamestown. The Duemelands were the recipient of the 2010 Bismarck Mandan Area Family Business of the Year. PB

With over a century of experience in business on the Northern Plains, Dacotah Paper is pleased to contribute to our customers’ success in so many different industries. Our objective is to help solve your problems and meet your needs. We are continually working to provide you with the best customer service possible by adopting the latest technologies to process and deliver your orders. Our experienced people are dedicated to providing each customer with the highest level of customer service possible.

Matt Keck, Ralph Vojta and Sandra Vojta of Prairie Berry Winery, Hill City, S.D.

Burke Blackman of Egger Steel, Sioux Falls, presents award to Skip Duemeland of Duemelands Commercial, LLLP, Bismarck, ND

prairiebizmag.com

t is not a surprise that communities don’t have natural gas because of economics,” states Doug Lee, pipeline manager for Kadrmas, Lee & Jackson, headquartered in Bismarck, ND. “However, now would be a good time to start investigating the feasibility of having a municipal gas distribution system throughout the upper Great Plains.” Dennis Haider, Executive Vice President for regulatory, gas supply, and business development for MontanaDakota Utilities/Great Plains Natural Gas, adds natural gas is reliable, safe, abundant, and extremely economical. “It is not tied into oil pricing and is convenient,” Haider says. One small community in southeast North Dakota is working with Bobcat Company, its major employer, to bring in a pipeline that would provide natural gas to as many as 50 percent of the 300 residents in Gwinner, ND. Not only do community members feel the time is right because of the cost, but there is also an economic development consideration in the community. “Without Bobcat on board and converting their process over to natural gas, it wouldn’t be feasible for us,” states Gwinner, ND City Manager Jeff Anderson. “We hope to expand this and make it a regional pipeline that will also be used in Lisbon, Forman, Milnor, and Oakes.” Anderson adds that having natural gas will be a huge draw for new businesses to the community. Gwinner is still in the planning phase working with different groups on the construction process and paying for the $8 million project. Anderson adds that there could be as much as a 75 percent savings for residents who use the natural gas over propane. Gwinner is looking at two different possible hook ups; one from a pipeline close to Enderlin, 36 miles away, and the other from a pipeline close to Milner, 11 miles away. The hope is to start construction this year and have natural gas hooked up and flowing in 2012. MDU, headquartered in Bismarck, ND, has been looking at several areas of expansion in the southern and east central areas of North Dakota for several years. In recent years, the company expanded service into the Hankinson, ND area for the new ethanol plant and to numerous grain drying facilities. Across the border in Minnesota, Battle Lake, MN, located near Perham, MN, is performing a feasibility study

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DENNIS HAIDER Vice President Regulatory, Gas Supply, Business Development Montana Dakota Utilities/Great Plains Natural Gas

DOUG LEE Manager Kadrmas, Lee & Jackson

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and Kadrmas, Lee & Jackson is assisting with ground work to put in a distribution system that meets federal and state regulations, as well as assisting with economic feasibility. The hope is to tap into an existing pipeline 14 miles away in Perham’s facilities that would allow Battle Lake to run natural gas into the community and allow the community to operate the system itself. Kadrmas, Lee & Jackson has also had preliminary discussions with Rugby, Beulah, and Hazen; all North Dakota communities. In South Dakota, Basin Electric Power Cooperative, based in Bismarck, ND, will be commissioning the Deer Creek Station, a new power plant in south Dakota about 20 miles east of Brookings, near Elkton. Deer Creek Station is expected to be commissioned in the Summer of 2012. It will be fueled with natural gas. A tap line from the Northern Border Pipeline has already been constructed that will deliver fuel to the plant. Basin Electric already has two other natural-gas fueled generating units near Groton, SD. These units became operational in 2006 and 2008, respectively. “Natural gas is currently plentiful,” states Daryl Hill, Media Relations Supervisor for Basin Electric. “But some of its drawbacks have been the volatility of price. Since 1992, the price of natural gas has fluctuated from $1.05 per dekatherm to $13.94. From a fuel perspective, it is important to have a stable base for the price of fuel.” According to the American Gas Association web site, natural gas serves approximately 65 million homes, 5 million businesses including hotels, restaurants, hospitals, schools, and supermarkets, more than 200,000 factories, and 1,800 electric generating units. On a daily basis, the average American home uses more than 200 cubic feet of natural gas. In addition, AGA states that natural gas utilities do not earn a profit on the natural gas they deliver. They earn their revenues from the service and delivery fees they charge customers to transport the natural gas to them. This fee is directly linked to the volume of natural gas consumed, rather than the price of natural gas being delivered. Natural gas is efficient, according to AGA. Ninety-two

Natural Gas Facts: Natural gas serves approximately 65 million homes, 5 million businesses including hotels, restaurants, hospitals, schools, and supermarkets, more than 200,000 factories, and 1,800 electric generating units. On a daily basis, the average American home uses more than 200 cubic feet of natural gas. Natural gas utilities do not earn a profit on the natural gas they deliver. They earn their revenues from the service and delivery fees they charge customers to transport the natural gas to them. This fee is directly linked to the volume of natural gas consumed, rather than the price of natural gas being delivered.

percent of natural gas produced is delivered to customers as usable energy. The volatility of natural gas price is one of the inhibitors that slowed the construction of natural gas projects. However, communities were not thinking about hooking up natural gas because of other reasons such as the cost of a project and demand for usage of natural gas. “It is more the norm not to have natural gas,” Anderson explains. “It is just too expensive to get to the user. However, once in an area, it is economical.” Communities are now rethinking strategies to hook up natural gas lines because the cost continues to spiral down. Currently, the price of propane is up and the price of natural gas is down. MDU gets its natural gas from suppliers via transmission lines. “We interconnect to provide service to customers in communities through our distribution system,” Haider explains. “This supply needs to be diverse and reliable, which are major factors in looking to bring service to a new area.” Haider adds that the gas delivered to customers must also meet stringent quality measures. “When bringing natural gas to a new area, some of the factors to overcome include disruption to areas of town in order to install

Natural gas comprises almost one-fourth of all energy used in the United States and is directly linked to jobs and economic health. In 2009 utility ratepayer assistance programs generated $2.4 billion for low-income customers. In addition, United States utilities spent $276 million on energy efficiency programs for lowincome customers. Source: American Gas Association Web site

34 Prairie Business Energy

Crews working on pipeline projects. (Photo courtesy of Williston Basin Electric Pipeline Company.)

May 2011

lines, as well as meeting minimum customer use in order to overcome installation hurdles.” Lee notes that the biggest inhibitor to installing a natural gas system is its proximity to a natural gas transmission line and the corresponding cost of bringing gas to a community. The expanding pipeline infrastructure is quickly making this less of an issue and lower construction costs are contributing to a renewed interest in distribution systems. “The second issue is the cost of capital to construct a system,” he states. “Municipalities can issue general municipal bonds, but only with a vote. “Revenue bonds are also available, but at a substantially higher cost, however some communities are finding that natural gas availability contributes significantly to business development,” Lee continues. “Finally, compliance with pipeline safety regulations can be costly because of the training necessary to ensure operators have an adequate understanding of the safety issues to protect the public, which is leading to new opportunities for independent operating companies to start-up.” However, the main reason that natural gas is a good source is because it is inexpensive compared to alternate fuels such as propane or electricity, Lee says. “It is also a comparatively clean fuel

supply,” he adds. “And finally, natural gas is extremely abundant in the U.S. and this will most likely ensure that prices remain comparatively low over the next 20 to 30 years. In North Dakota more gas is flared in one day than the average North Dakota home will consume in a year.” Haider agrees, adding that natural gas supply, a continentalproduced energy source, is more abundant and has more long-term reserves (more than 100 years) than ever. Alan Van Ormer - avanormer@prairiebizmag.com

NATURAL GAS GENERAL SAFETY INFORMATION NATURAL GAS PIPELINES are the nation’s safest method of transporting energy, quietly delivering large volumes of the clean-burning fuel to local natural gas distribution companies, who ultimately carry the gas to homes and businesses. THE INTERSTATE NATURAL GAS pipeline industry invests millions of dollars each year in maintenance and construction programs, facilities testing, research, emergency training and public information to ensure safety and to maintain the reliability of the nation’s interstate natural gas delivery system. WILLISTON BASIN INTERSTATE PIPELINE, a subsidiary of MDU Resources Group, operates over 3,700 miles of natural gas pipelines, 33 compressor stations, various storage wells and other facilities across North Dakota, Montana, Wyoming, and South Dakota. THE NUMBER ONE CAUSE of pipeline accidents or problems is third party damage caused by digging. Pipeline companies need help from homeowners and excavators in keeping the pipeline route clear of structures, trees, or any suspicious activity for effective surveillance of the pipeline. Source: MDU Resources Group prairiebizmag.com

Finding a niche in frac sand bins Amber Waves, a Richardton, ND company located in the middle of the Oil Fields of western North Dakota, has found a niche in constructing frac sand bins for sand companies.

ice President Jody Hoff states that in the first four years of frac sand bin production Amber Waves has been involved in improving and designing the product to meet its customer’s needs. “We have heard that the bins typically work great, save time, do a good job of keeping sand clean, dry, and protected from the elements, and is easy to empty,” Hoff explains. The concept for frac sand containers started in 2008 from a request from a customer to store sand. Amber Waves, a steel manufacturer specializing in bulk materials, designed and built those first bins to handle the heavier sand density used in the oil industry. Different bin designs hold as little as 240,000 pounds of frac sand capacity to as much as 300,000 pounds of frac sand. It is estimated that between one million and two million pounds of frac sand is needed for one oil well. A truck can haul up to 50,000 pounds of sand, meaning six truck loads are needed for one 300,000 frac sand bin. Amber Waves’ production of the frac sand bins has more than doubled in 2010 compared to the first two years. Hoff expects sales to even be better this year. Overall, with the assistance of the frac sand bins, Amber Waves grew more than 30 percent between 2009 and 2010. The increase is expected to be more than 50 percent between 2010 and 2011. Half of the frac sand bins are delivered to southern Texas, but there is also a good volume sold to sand companies in the Bakken. The sand frac bin looks like a normal grain bin, but uses much heavier steel to hold the heavier sand particles. In addition, the design has been modified to keep the diameters smaller than a normal grain bin. The main difference is the tube pushes frac sand from a truck into the bin. “The neat thing about our product is when they are done with frac sand or when the boom is over they can be used for grain bins,” Hoff says. “Companies that purchase our bins have a fantastic resale.” In the past, customers who are using the sand frac bins, were

36 Prairie Business Energy

May 2011

hauling sand with 2,000 pound tote bags carried on forklifts, old bins or old elevators. Hoff says the efficiency is in the sheer convenience of having the materials in bulk and being able to set up the bins at a rail site. “All they have to do is back the truck in, get the sand, and head out to the wells,” Hoff explains. Hoff sees a promising future. “We’re excited about providing these to the oil fields,” he states. “It looks like a true need.” Alan Van Ormer - avanormer@prairiebizmag.com

Welding a frac sand bin.

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prairiebizmag.com

Wherever wind blows… And it just happens to blow in North Dakota Ranking #6 in wind energy capacity, North Dakota is poised as a model for the development of innovative, long-term wind and energy resources in America. To continue that long-term development, the North Dakota Department of Commerce has extended its wind energy industry recruitment strategy into Europe. uropean manufacturers are interested in the U.S. market for wind power equipment,” says Mike Fladeland, manager of Energy Development at North Dakota Department of Commerce. “There are customers here in the U.S., in the form of utility companies and project developers that purchase towers, generators, blades, and other equipment and supplies. This provides additional revenue-generating opportunities of interest to European companies.” EWEA, the European Wind Energy Association, is the European equivalent of the American Wind Energy Association in the U.S. EWEA actively promotes the development of wind power worldwide. It now has nearly 60 countries including manufacturers with a 90 percent share of the global wind power market, plus component suppliers, research institutes, national wind and renewable associations, developers, contractors, electricity providers, finance and insurance companies and consultants. These combined strengths make EWEA the world’s largest and most powerful wind energy network. For the first time, Commerce staff scheduled prearranged meetings with European based equipment manufacturers and exhibited at EWEA 2011 – the association’s annual conference and exhibition — this past March. “Our role is to meet with people who are knowledgeable in the wind power industry and with representatives of companies that may be considering expansion of their business,” Fladeland says. This year’s event was held in Brussels and included 445 exhibiting companies and over 8,000 visitors. Commerce participated in the EWEA event to promote North Dakota as a location of choice for those European equipment manufacturers that are looking to enter and

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38 Prairie Business Energy

May 2011

FOR EXAMPLE, NORTH DAKOTA IS HOME TO THE LARGEST DEPOSIT OF LIGNITE COAL IN THE WORLD IS THE 4TH LARGEST OIL-PRODUCING STATE IN THE NATION IS A TOP PRODUCER OF 14 DIFFERENT AGRICULTURAL COMMODITIES HAS THE NATION’S ONLY NATIONAL CENTER FOR HYDROGEN TECHNOLOGY AND NATIONAL ENERGY CENTER OF EXCELLENCE

NORTH DAKOTA’S ENERGY RESOURCES ARE MORE DIVERSE THAN JUST WIND AND ARE BROADER THAN ANY OTHER STATE IN THE NATION.

HAS A UNIVERSITY SYSTEM WITH WORLD-CLASS ENERGY RESEARCH AND TRAINING PROGRAMS HAS THE 515 MW HYDRO-ELECTRIC PLANT AT GARRISON DAM HAS THE NATION’S ONLY COAL GASIFICATION FACILITY - THE GREAT PLAINS SYNFUELS PLANT

grow operations in the U.S. market Paul Lucy, director of Commerce’s Economic Development and Finance Division, and Fladeland met one-on-one with representatives from 25 companies and had numerous less formal conversations with other companies over a four day period during EWEA 2011. “Each meeting we have builds a relationship which will be nurtured to result in diversifying North Dakota’s economy and creating new manufacturing and advanced technology jobs for our residents,” Lucy says. LM Wind Power, based in Denmark, is a prime example of a European company that North Dakota has built a strong relationship. In response to a growing need for wind energy in North America, the company, formerly known as LM Glasfiber, opened its first manufacturing facility in Grand Forks, ND in 1999. As the U.S. wind energy industry continues to expand, industry leading OEMs from around the world will look to capitalize on this market. North Dakota intends to continue to be aggressive in promoting itself to create expanded opportunities in the state with those European companies leading in the area of wind energy. Stacey J. Loula is a Marketing Intern for the North Dakota Department of Commerce. She can be reached at sjloula@nd.gov.com. prairiebizmag.com

Money

Local Matters

Where your bank has a big impact on your community

oes your choice of where you bank really matter when it comes to the financial health of the local community? Consider these statistics. Our country’s economy depends in large part on the success of the small business entrepreneur. Small businesses according to the U.S. Small Business Association (SBA): Employ over half of all private sector employees Pay 44 percent of total U.S. private payroll Create more than half of the nonfarm private gross domestic product (GDP) Generated 64 percent of net new jobs over the past 15 years These businesses depend heavily on small to mid-size local banks for financing. The Office of Advocacy of the SBA recently released a study that showed in 2010 the smallest banks in America devoted 87 percent of their total business loan portfolios to small business loans (loans under $1 million). Compared to 26 percent for the largest lenders. Yet, according to data from the Federal Deposit Insurance Corporation the giant banks in America (defined as those with $100 billion or more in assets) control 44 percent of U.S. deposits, while small banks (defined as those with $1 billion in assets or less) control 15 percent. Your choice of where you bank, both the saving and lending side, does have a direct impact on the investment

DANA DYKHOUSE President/CEO First PREMIER Bank ddykhous@firstpremier.com

of dollars into your local community. One of the main activities of almost all community banks is to turn deposits (checking and savings) into loans. These loans can come in the form of personal, business and agricultural. Bigger banks devote a larger share of their resources outside of the community. The bottom line is that the more the community prospers, the more the local bank benefits and is able to reinvest. When you bank locally you’re choosing to work with an organization whose key decisions are made by people who live in the community – not in some far off boardroom in another state or country. Good community bankers pride themselves on face-to-face relationships with their customers and taking the time to understand local needs. If you are concerned about technology, fees or rates, you shouldn’t be. Today the vast majority of community banks offer most of what their large counterparts offer with lower fees and higher savings rates. With the notions of “too big to fail” and bailouts, it has caused a lot of individuals and business owners to reevaluate their banking relationships. Many have considered the correlation between the success of their community and their local banks and they have decided to go local. PB

Sales/Marketing

Who Are You?

hat is your company’s online presence like? No doubt you have a website. Perhaps you even have a Facebook or Twitter page. But beyond that? You may not be the only one generating content about you, your business or your product. Like any curious individual, you probably Google your name every once in a while just to see what comes up. That’s actually a good idea, but don’t stop there. There are many free online tools to help you find out more about who wants what you offer, who is talking about you, and what they are saying. Let’s look at a couple of Google’s online tools. GOOGLE ALERTS. If you can use just one thing to find out who is saying what about you, your industry or product, then choose Google Alerts (www.google.com/alerts). This simple tool will send you an email any time something is posted online about whatever topic you are interested in. Consider creating alerts for your name, your business, your product, your industry—even your competitors! You can receive alerts as they occur, once a day or once a week in one lump email (one email per topic).

SHERI BOOMS HOLM Communications Specialist West Central Initiative sheri@wcif.org

40 Prairie Business

Solve the mystery of who is looking for your products online, who is talking about you and what they are saying.

May 2011

GOOGLE ANALYTICS. Perhaps you already have a counter on your website that lets you know how many people are visiting it. But who are they and what pages (products) are they most interested in? Google Analytics (www. google.com/analytics) provides a treasure trove of information about who is visiting your site, when and for how long. Are you doing a marketing campaign and driving people to a particular webpage? Add that page to your analytics before you start to help measure the effectiveness of your campaign. GOOGLE BLOGSEARCH. Are you reading industry blogs? Blogsearch.google.com can help you find blogs that are talking about what interests you most. Consider commenting on industry blogs as a way of getting your name and the name of your business known, and establishing expertise on a certain topic (“Hey, this person knows what he/she is talking about! They’ve got the exact product I’m looking for!”) Also look for industry-based Twitter or Facebook pages. It’s not a waste of time if your comments help generate sales leads. PB

Question & Answer

Supporting rural communities

THE O’BRIEN FILE NAME: DOUG O’BRIEN TITLE: DEPUTY UNDER SECRETARY COMPANY: UNITED STATES DEPARTMENT OF AGRICULTURE HOMETOWN: BERNARD, IOWA YEARS WITH THE DEPT. OF AG: 3

Rural communities are finding that resources are stretched and working together with other governmental units is important to provide services needed to grow these communities.

n the economic development side, many times many of the emerging businesses, because of workforce needs or natural resources, they need to draw for more than one town,” explains Doug O’Brien, Deputy Under Secretary for the United States Department of Agriculture. “It increases the chance of success for that particular entity.” O’Brien is involved with economic and community development working on policy and programs for the USDA. He was in Dickinson, ND recently to discuss policies that encourage the region to come together and create a regional economic strategy. Several successes were highlighted. While there is natural competitiveness in communities, O’Brien says the key is people in the rural communities communicating with each other and realizing the common interests they have with each other on these projects. O’Brien states the vision for the future is to support what people in rural communities want. “We’re trying to encourage folks to take a fairly rigorous approach to determine t heir economic future,” he says. This is being done in three ways. First, looking at what the region already has. Second, broadband collaboration, and third, measuring success or failure. “We have a responsibility to all those who pay taxes to be transparent for what is successful and what is not successful,” O’Brien says. “We need to learn from it.” O’Brien feels that rural communities are the cultural fabric of the country. “Leaders come from Rural America,” he explains. “Sixteen percent of the people live in rural communities. Forty percent of our Armed

O “

Forces come from rural communities. USDA Rural development provides opportunities that rural communities can not only survive, but thrive.” A common theme moving forward is the budget. “People in the country understand we need to deal with deficit spending,” O’Brien says. “That difficult choices need to be made. As importantly, we do need to invest in the future. The president has talked at state of union for America to win the future we need to out educate, out innovate and out build our competition. Budget you can see those are the priorities.” It is also about communities working together and leveraging dollars with federal and state government. “It is only going to become more important in the next few years,” O’Brien comments. The American Recovery Act was successful in making sure the American economy protected thousands of jobs, O’Brien says. “There has been job growth in the private sector each of the last twelve months,” he states. “I think the corner has been turned, but there is a lot more to do.” An estimated $200 million came into the state for rural development and it included projects that might not have been possible like hospitals in Williston and Crosby, as well as broadband and water projects. As for the future, O’Brien says USDA will continue to evolve to meet the needs of rural communities and services that they provide. “Traditionally, USDA has focused on agriculture. That is not going to change,” he states. “I think we will see small towns will become more important to the fabric of states in the country. You will see USDA respond to that.” PB prairiebizmag.com

ViewPoint

The hidden reality of Payroll and HR Administration costs Do you know how much your organization is really spending on payroll and HR administration? hances are you may not be considering major cost components related to administering these important functions and may be spending more than you think as a result. As a general rule, we have found that organizations tend to underestimate the true expense (the “total cost of ownership,” or TCO) of processing payroll, administering employee health and welfare benefits, and managing other key HR systems and functions. While most organizations consider costs such as a payroll department’s staff or the acquisition costs of a new ERP solution, many fail to recognize certain “hidden” costs necessary for operating and integrating these interdependent processes. Additionally, organizations often apply separate technology and process solutions to these individual administration functions without considering how those solutions work with each other. This fragmentation drives up administration costs through task overlap and other inefficiencies. Although these functions are expensive, a recent PwC study of 279 organizations, ranging in size from 100 employees to more than 100,000 employees, uncovered

D.C. LUCAS District Manager ADP dc_lucas@adp.com

several opportunities for increased cost effectiveness. The top cost reduction strategies, measured by overall TCO are: Outsourcing: Organizations managing payroll, workforce administration, time and attendance, and health and welfare benefits in-house using premise-based or hosted software solutions spend on average 18 percent more administering these functions than organizations that outsource these functions. Utilizing a common vendor or solutions: Organizations administering these functions in-house using software solutions from multiple vendors spend on average 18 percent more than those organizations administering them in-house using a common vendor. Organizations outsourcing multiple functions to a single vendor see even stronger cost efficiency—on average 32 percent—versus organizations using multiple vendors or “best of breed” inhouse approach. To download a complimentary copy of PwC’s 2011 TCO study, please visit: http://bit.ly/dI76Ga Source: PwC - The Hidden Reality of Payroll & HR Administration Costs (January 2011) PB

How to Prepare for Annual Audits Annual audits can, at many times, turn into scary and stressful ordeals, but by being prepared before the auditor comes on-site, you can turn it into a non-stressful learning experience instead. llow the accountant time to finalize the fiscal yearend balancing. Before you schedule your audit, you should contact your accountant to see what time line they need in order to get the fiscal year balanced. Allow sufficient time to complete the audit process. Time for the auditor to complete the audit, time for your agency to complete the audit resolutions, and time to get the audit submitted before deadline. Get a jump start on items selected for review from your auditor. Many auditors will request the general ledger trial balance, bank statements, and other documentation several weeks before the audit. This allows them to make selections of what items they will be reviewing when they are on-site for the audit review. If your auditor doesn’t prepare these lists before they make their on-site visit, I highly recommend that you request the listing. Start on this task immediately upon receiving it so you have time to confirm all supporting information is included, such as signatures, authorizations, invoices, purchase orders, contracts, re-certifications, withholding certificates, wage

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May 2011

ANGELA REITER Accountant DFC Consultants areiter@dfcconsultants.com

agreements, etc,. Pay close attention to payroll, credit card and travel information, as these get very close attention from auditors. Make the audit a priority for all staff. The willingness of an auditor to work with you can be dependent on the willingness of the staff to work with the auditor. If you are quick to respond to the auditor’s requests, they are more open to discuss any particulars they find concerns with. Learn from the auditors. Auditors often schedule pre/post audit meetings with board of directors and staff, to cover expectations and result. Be responsive to these meetings, especially if they are noting items that will be written as a finding as you may have the documentation or knowledge that someone else wasn’t able to find or explain. During an exit meeting, auditors will usually mention what types of actions can resolve a finding. If they don’t, or you are not sure, be sure to ask the auditor for examples. By following these tips, you can change the mean of ASAP to Audit Sanity A Possibility! PB

Leadership/Management

Sweat the Details In the beginning of a project of any size you need to diligently prepare. But with a bolder plan you need to sweat all the details. Assessing the culture of the organization, examining whether there is sufficient urgency, determining if there is a clear vision, establishing opportunities and assuring that the necessary courage is present, are all necessary to carry the project through to fruition. tart by reviewing if your board, medical staff, and employees believe that there is a better way to do things? Can you improve patient and staff safety? Are their efficiencies that will not only save dollars but allow your most important assets, caregivers, to spend more time with patients? Are most of your formal and informal leaders on board? Starting in May, 2008, we had meetings with the hospital staff (no more than fifteen participants each meeting) to explain the project and elicit responses. After each meeting, the participant’s thoughts were summarized and then shared with the next group to create an information chain. These meetings provided the necessary energy and knowledge base to move the project forward. As more specifics were shared the vision came to life. In essence, our staff became marketing partners. With the worst recession in our country’s history upon us, we found opportunities. For us, it was much better pricing on construction, exceptionally favorable interest rates through USDA, and contractors bringing their best workers to the project. Courage in leadership is required. Our Board exerted a level of thoughtful courage that went beyond what could be expected of leaders given some of the obstacles that occurred early in the project. They also insisted on creating a team of committed leaders from within the organization and external experts. By sweating the details you will get out of a project exactly what you put into it. Even though you will retain

MARTIN RICHMAN CEO Jamestown Hospital mrichman@ jamestownhospital.com

the services of very qualified individuals, architect, construction company, and an owner’s rep, to create your new building, there is no substitute for understanding what is in the drawings. You should also be monitoring the specifics as the actual building develops. Involving every level of management as well as the employees who provide the care will save money and angst as the project becomes reality. PB

WIRELESS QUICK FACTS Cell Sites

Monthly Text Messages

Minutes of Use

253,086

187.7B

2.2T

183,689

1.5T 9.8B

104,288 258.8B

14.4M

37.8B DEC. 10 T=Trillion

DEC. 05

B=Billion M=Million

DEC. 00

DEC. 95

DEC. 10

DEC. 05

DEC. 00

22,663 N/A DEC. 95

DEC. 10

DEC. 05

DEC. 00

DEC. 95

Source: CTIA The Wireless Association

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By the Numbers EMPLOYMENT

(NOT SEASONALLY ADJUSTED) UNEMPLOYMENT RATE North Dakota Fargo MSA Bismarck MSA Grand Forks MSA Minot MiSA Dickinson MiSA Williston MiSA Jamestown MiSA Wahpeton MiSA South Dakota Sioux Falls MSA Rapid City MSA Aberdeen MiSA Brookings MiSA Watertown MiSA Spearfish MiSA Mitchell MiSA Pierre MiSA Yankton MiSA Huron MiSA Vermillion MiSA Minnesota Minneapolis-St. Paul MSA Brainerd MiSA Winona MiSA Fergus Falls MiSA Red Wing MiSA Willmar MiSA Bemidji MiSA Alexandria MiSA Hutchinson MiSA Marshall MiSA Worthington MiSA Fairmont MiSA

Feb. 2010 4.5% 4.7 4.6 5.4 4.4 2.6 1.5 4.8 4.7 5.4 5.4 5.7 4.3 4.2 5.4 5.1 4.8 4.2 5.3 4.2 3.8 7.4 6.9 11.6 6.6 8.7 7.6 7.3 9.3 7.7 9.9 6.4 5.9 7.3

Feb. 2009 4.9% 4.8 5.2 5.1 5.3 3.5 1.9 4.1 5.4 5.8 5.4 5.5 3.9 4.0 6.0 4.7 5.3 3.7 5.2 4.2 3.6 8.6 7.6 12.0 7.3 9.4 8.7 7.5 9.4 7.6 10.2 6.3 5.5 8.2

EMPLOYMENT Feb. 2010 Feb. 2009 350,595 346,015 112,619 113,668 58,364 58,259 51,666 51,849 31,076 1,471 15,839 14,304 19,959 15,245 10,749 11,357 13,188 11,495 417,580 410,338 121,550 121,115 61,655 62,115 22,400 22,170 18,470 18,250 17,510 17,125 12,905 12,795 12,320 12,075 12,015 11,655 10,990 10,925 9,370 9,195 7,495 7,500 2,728,138 2,682,223 1,711,574 1,703,568 40,134 40,642 25,806 27,301 27,385 27,048 23,937 23,104 21,851 22,678 20,464 19,506 18,355 19,107 16,854 18,586 13,661 13,981 11,076 11,449 10,333 10,926

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 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.

NORTH DAKOTA OIL ACTIVITY Sweet Crude Price/BBL

Production Oil-BBL/day

JAN 2010 DEC 2010 NOV 2010 SEPT 2010

$81.03 $75.74 $74.41 $67.95

342,088 343,867 355,038 342,094

JAN 2010 DEC 2010 NOV 2010 SEPT 2010

Permitting Wells 142 134 245 167

JAN 2010 339,028

Producing Wells 5,315 5,331 5,197 4,628

Gas Production-MCF/Day DEC 2010 NOV 2010 SEPT 2010 341,990 352,559 340,187

Source: NDIC DMR

FEBRUARY AIRLINE BOARDINGS BOARDINGS

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

03/28/10

02/28/11

U.S. to Canadian Dollar-

$1.03 or $0.9723

$0.97 or $1.0268

$0.98 or $1.0248

U.S. to Euro

$0.75 or $1.3398

$0.73 or $1.3792

$0.71 or $1.4104

U.S. to Chinese Yuan

$6.82 or $0.1465

$6.57 or $0.1522

$6.56 or $0.1524

U.S. to Japanese Yen

$92.57 or $0.0108

$81.91 or $0.0122

$81.66 or $0.0123

U.S. to Mexican Peso

$12.54 or $0.0800

$12.11 or $0.0823

$11.96 or $0.0836

Source: Bank of Canada

Data provided by Kingsbury Applied Economics

CANADIAN BORDER CROSSINGS

Intl. Falls-Rainer Grand Portage Baudette Warroad Roseau

May 2011

TRUCKS

FEB 2010

% CHANGE /FEB 2009

28562 19923 11233 9412 3034

7.93% 32.41 1.24 32.41 11.09

1577 1124 860 1058 549

- 9.63% 17.70 -34.95 - 7.76 23.09

FEB 2010

% CHANGE /FEB 2009

18959 5504 3931 3401 3356 2340

14.75 8.50 15.38 20.30 20.85 12.77

15673 5888 1024 1968 752 153

- 2.01 - 2.76 -11.50 - 9.89 -30.69 -20.31

NORTH DAKOTA

Pembina Portal Neche Dunseith Walhalla Noonan

Source: US Customs and Border Protection

46 Prairie Business

- 3.72 - 5.99 17.25 - 0.65 - 5.78 5.14 85.59 37.52

Source: US Customs and Border Protection

MINNESOTA 03/28/11

% CHANGE/2009-2010

1,061,138 30,266 29,124 15,130 11,161 9,402 9,289 1,107

AUTOMOBILES

CANADIAN EXCHANGE RATE

Rig Count 163 163 158 143