Prairie Business May 2012 by Prairie Business Magazine

May 2012

Tourist Appeal

The Art of Creating and Sustaining Destinations pg. 24

Using Branding Campaigns to Boost Tourism pg. 28

How Area CVBs Attract Visitors pg. 30

www.prairiebizmag.com

North Dakota. Doing Business Better. The Enchanted Highway and its larger-than-life metal art draws visitors from around the country to rural North Dakota. Now, with support from the North Dakota Department of Commerce and its Tourism Division, the Enchanted Highway Foundation is developing a hotel, bringing additional economic activity to the area. Learn how North Dakota is doing business better at www.NDBusiness.com

CONTENTS

Volume 13 No. 5

From the Editor’s Desk

Matthew Mohr

Prairie News

Prairie People

Business Development Thriving economy before the disaster is helping Minot recovery efforts.

Finance: Shopping and banking local makes sense

Economic Development: SD rolls out new project development tool

Research and Technology: ‘To out-compete is to out-compute’

Cover Story: Tourism

28 30

Feature: Branding

Creating and sustaining regional destinations

What’s in a brand?

Feature: Destinations Creating regional tourism Meccas

One step closer to E15

Building on bioprocessing

Growth Energy expects few remaining regulatory hurdles to be cleared soon

Sharing airspace Regional integration important for unmanned, manned aircraft

SDSU envisions multiple approaches to making bioproducts

A game-changing industry UAS have potential to drive economic growth in Red River Valley

Red River Valley: In the spirit of collaboration

Western North Dakota:

Next Month In June Prairie Business will be taking an in-depth look at health care in the region. Special attention will be given to diagnostic discoveries and the new research, equipment and education used to detect medical issues. Another important topic being featured is preventative medicine, specifically wellness centers and the variety of ways they contribute to their communities.

On the air

Creating value-added opportunities

Join Prairie Business magazine Editor Alan Van Ormer on Tuesday, May 8, at 3 p.m. on any Prairie Public radio station to hear more about the May cover stories. To listen to Prairie Public, visit www.prairiepublic.org/radio/hear-it-now.

South Dakota:

On the cover

Retread tire company growing

Horseback riders explore Theodore Roosevelt National Park in Medora, N.D. The Peaceful Valley Ranch helps travelers see the park from the back of a horse the way Theodore Roosevelt did. There are more than 80 miles of trails to explore in the South Unit, including the Petrified Forest (where prehistoric palms, cypress and redwood turned to stone), Halliday Wells and Painted Canyon. Peaceful Valley Ranch, located seven miles into the park, offers horse rentals and guided trail rides with lessons and interpretive talks along the way. (Photo courtesy of Jim Gallop/North Dakota Tourism)

By the Numbers

4 Prairie Business

May 2012

From the editor’s desk

For daily business news visit prairiebizmag.com

An SBA Award Winning Publication

Economy progressing — slowly By Alan Van Ormer

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

John Fetsch jfetsch@prairiebizmag.com

701.212.1026 eastern ND/MN/eastern SD

SALES:

t recent business conferences, economists and others are talking positively about the economic resurgence across the country, but are also pointing out the process is slow and a larger-than-life government debt could bring the nation’s economy crashing down. In April, Ed Kashmarek, an economist with Wells Fargo, in his address at the Global Business Connections in Fargo, N.D., said that the economic growth continues to be about 2 to 2 ½ percent, but he noted that is still not strong enough to bring down the nation’s unemployment which was at 8.3 percent in February. In addition, debt to the public could approach 200 percent of the gross domestic product (GDP) by 2036 if government leaders do not do something to get the budget back on track, he said. Kashmarek also pointed out that the rate of job growth is increasing. Since the recession there were 3.5 million jobs created. However, 8.8 million jobs were lost during the recession, meaning there still is a ways to go. In his overall outlook, he thinks “modest consumer spending and further declines in government spending will keep economic growth subpar. Business investment should remain decent, while residential investment should improve.” A week earlier at the Governor’s Business Forum in Minot, N.D., Delore Zimmerman, president of the Praxis Strategy Group and executive director of the Red River Valley Research Corridor, unveiled a report “Enterprising States: Recovery and Renewal for the 21st Century,” outlining conditions of the American economy in 2011. Over the past 10 years, the Great Plains states have become one of the great job growth corridors of the country with an increase of 11.5 percent in jobs over that period. In addition, North Dakota was No. 1 in job growth in 2011 with an estimated 5.7 percent job growth. The state created 23,900 jobs from January 2011 to January 2012. In fact, South Dakota and North Dakota were two of the top 10 performing states in job creation, economic growth and prosperity in 2011. Alaska was No. 1 in the nation, followed by North Dakota. The report also pointed out that continued economic success in the region depends on investments in colleges and public universities, starting and expanding businesses, public-private partnerships and privatization initiatives and workforce training and development. The economy continues to slowly recover from the recession, but experts like those above explain that there is still work that needs to be done to continue the growth.

Brad Boyd bboyd@prairiebizmag.com

800.641.0683 western ND/western SD

Shelly Larson slarson@prairiebizmag.com

701.866.3628 eastern ND/western MN

EDITOR: Alan Van Ormer avanormer@prairiebizmag.com Editorial Advisors:

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

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

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

Online: www.prairiebizmag.com 6 Prairie Business

May 2012

701.371.9578

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Business Advice

Tough Negotiator By Matthew D. Mohr egotiation is part of business and part of life in general. Some people are good negotiators and consider this a factor of success. Few people want to be considered a pushover. Strong-arm negotiators can be successful and get what they want, or can end up getting far less than they bargained for. Itâ&#x20AC;&#x2122;s nice to feel you bargained and received a good deal, but bargaining in good faith, especially in our region, is essential. At one time there was a Fargo, N.D., developer who prided himself on being the toughest of tough negotiators and frequently bragged about how he would beat his suppliers down. His bragging brought him a few accolades, but over time it bought him low quality workmanship and lower quality materials. As his reputation grew, good suppliers stopped dealing with him, and those that did substituted cheaper materials whenever possible. An electrical contractor,

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May 2012

who is a friend of mine, informed me that the wiring on one of his projects had to be replaced in a few years because the wire gage was just a little less than actually necessary to carry the load, but the bid was the cheapest. Floor covering was replaced in a few years instead of 10 as expected. Current negotiation practices are more focused on win-win or mutual success than the toughest negotiatorâ&#x20AC;&#x2122;s win of yesteryear. Strong intelligent negotiating skills are valuable, but negotiations in todayâ&#x20AC;&#x2122;s environment need to be done in the spirit of mutual success and satisfaction. If you find yourself on the short end of negotiating for something too often, it may be a good idea to get a little extra negotiation skill coaching. Many courses are offered on negotiating skills. Similarly, if you feel you consistently win at negotiation but feel cheated in the end, you may need some help. PB

Prairie News

4 BEARS CASINO EXPANDING 4 Bears Casino & Lodge in New Town, N.D. recently announced plans to break ground on a new hotel wing. The 122-room hotel addition to the existing 4 Bears Casino & Lodge will include 100 standard rooms, 20 suites and two executive suites with walk-out balconies. The new design will emphasize functionality, sustainability and aesthetics, with many rooms showcasing the views of Lake Sakakawea. The executive suites are more than 1,600 square feet each with upgrades throughout. The hotel is slated to be open for business this fall and will be funded entirely by the Three Affiliated Tribes. Along with the expansion, a new finedining restaurant is also planned that will accommodate up to 120 people. The current Cache buffet restaurant will also be remodeled.

S.D. CITIES NEED HOUSING The South Dakota cities of Vermillion, Aberdeen and Brookings are seeing growth in jobs, and are hoping housing can keep up with the demand. Chicago-based Navigant Consulting has locations in Mitchell and Plankinton and is now expanding to Vermillion, creating about 50 jobs. That comes on top of major growth in manufacturing in the city during the past year. Aberdeen also is seeing more housing demand than what is available, largely due to a beef packing plant that is going online soon. And Brookings soon will be home to a $100 million cheese plant that could employ 400 workers within five years.

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N.D. PLANS TRADE MISSION TO COLOMBIA Plans are being made for a fall 2012 trade mission to Colombia. U.S. Commercial Service Commercial Officer Tanya Cole and Food Export – Midwest In-Market Representative for South America Sonia Amadeo were in Fargo, N.D., to meet one-onone with more than 20 North Dakota companies interested in a proposed North Dakota Trade Mission in October 2012.

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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

SANFORD EXPANDS AIR-AMBULANCE FLEET Sanford Health has purchased two King Air 200 airplanes that are based in Fargo, N.D., and will serve patients across the Midwest. Previously, Sanford’s team in Fargo leased one airplane from a local company. The airplanes serve every kind of patient, from babies to the most critically injured adults. Each airplane is able to transport two patients, two medical teams (up to five flight nurses and paramedics) and two pilots. The aircrafts can travel approximately 310 mph and are able to transport patients anywhere in the continental U.S. and areas of Canada. The planes are outfitted with the latest emergency transport features and also have autopilot. The cost of each plane was $2.2 million and includes everything from painting to outfitting with specialized medical equipment. Sanford’s transition to owning the planes (instead of leasing) is a more cost-effective practice in the industry and will save resources over time. Since 1984, Sanford’s Fargo fixed-wing team has completed nearly

10,000 flights and flown more than 2 million miles. By the end of 2012, Sanford Health’s fleet will include four fixed-wing airplanes and four helicopters with 125 flight nurses and paramedics, 38 pilots, and additional support staff and specialty crew members.

S.D. ECONOMIC DEVELOPMENT AWARD WINNERS

Gov. Jack Dalrymple (right) visits with North Dakota State College of Science professor Terry Marohl (center) and NDSCS President John Richman (left) during the ground breaking for the Bisek Hall expansion in Wahpeton, N.D.

NDSCS EXPANDING DIESEL TECH PROGRAM Bisek Hall on the North Dakota State College of Science campus in Wahpeton is expanding; a move that is expected to grow and enhance the school’s diesel technology program. Last year, the Legislature appropriated $10.3 million for the expansion project. Plans are to construct a 65,000-square-foot addition that will support 80 additional students in the diesel technology program. The expansion project will enhance the building’s safety conditions and will include interactive communications equipment for enhanced learning and high-tech automotive monitoring and diagnostic systems. The project is expected to be completed in June 2013. The college’s two-year diesel technology program provides students with extensive training and practical experience in servicing all types of engines, drive trains, hydraulic systems and electrical systems found on trucks and agricultural and industrial equipment. NDSCS also offers a three-year automotive and diesel master technician program.

10 Prairie Business

May 2012

South Dakota Gov. Dennis Daugaard recognized communities and business leaders for their achievements and contributions to economic development at the South Dakota Governor’s Economic Development conference in Sioux Falls. For the first time ever, two individuals — Norma Allen and Elmer Karl — were honored with the Excellence in Economic Development award. Karl was a business leader in Gregory, S.D., for 56 years, while Allen was among those who moved a firearm company to Sturgis, S.D., in 1985, and started what has become the largest firearm manufacturing cluster in the state. The communities of Brookings and Lemmon were recognized as the large and small Community of the Year, respectively.

EDUCATIONAL SOFTWARE COMPANY OPENS IN S.D. A unique new company using video game programming to teach science, technology, engineering and math — the STEM courses deemed vital to America’s business future — has located in the South Dakota Technology Business Center in Sioux Falls, S.D. STEM Fuse has developed a technology course that exposes students to the math, physics, programming and design skills needed to create a working computer game. Created and piloted by high school technology and business teachers, the computer programming course with a dash of physics, math and business mixed in, will be taught through game design.

POLARIS ADDING 89 JOBS Polaris Industries Inc. plans to add 89 jobs in Osceola, Wis., as it boosts production of its Indian motorcycles. Minnesota-based Polaris acquired Indian last year and produces the motorcycles in Spirit Lake, Iowa. Engines for both Indian and Victory motorcycles are made at the Osceola plant, which employs about 100. The Osceola plant once had a workforce of more than 500. Polaris had planned to close it in 2010 as part of a plan to move some ATV production to Mexico, but decided to keep some workers on in Osceola to build motorcycle engines.

N.D. FIBER OPTIC NETWORK COMPLETED What is being deemed the largest fiber-tothe-home network in North America is completed and will serve more than 8,000 rural residents in south central North Dakota. After more than eight years, Dickey Rural Networks and Dakota Central Telecommunications Cooperative have completed their fiber optic networks, providing broadband communications services to farms, businesses and residents in a 10,000-square-mile region. The co-ops believe the two networks represent the largest geographic area served by fiber-to-home communications in North America. The substantial investment for this upgraded network covers a 10,000-squaremile region that includes roughly oneseventh of North Dakota. It is 100 percent fiber-to-the home. Since 1996, the U.S. Department of Agricultureâ&#x20AC;&#x2122;s Rural Development has awarded more than $95 million in loans to Dakota Central Telecommunications and Dickey Rural Networks to help them develop their service areas and improve broadband infrastructure. Dakota Central also received a $2 million American Recovery and Reinvestment Act grant to provide fiber connections in sparsely populated areas.

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Prairie People

DENVER TOLLIVER

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.

TRANSPORTATION INSTITUTE NAMES NEW DIRECTOR

LAKE REGION HEALTHCARE HIRES CLINIC DIRECTOR

Denver Tolliver is the new director of the Upper Great Plains Transportation Institute in Fargo, N.D. Tolliver has been with the institute since 1980, serving as a research associate, director of the Mountain-Plains Consortium and director of the North Dakota State University transportation and logistics graduate program. Before joining NDSU, Tolliver was a rail planner with the North Dakota Department of Transportation. During his time at NDSU, he has been awarded nearly $25 million in grant funds. The institute is a free-standing interdisciplinary center at NDSU. Staff members conduct research and outreach focused primarily on small urban and rural transportation and mobility. NDSU’s graduate programs in transportation and logistics also are coordinated by the institute.

Jed LaPlante has been promoted to outreach clinic director for Lake Region Healthcare in Fergus Falls, Minn. LaPlante, a Fergus Falls native, has been with the organization as outreach clinic coordinator since 2010. He also served as an administration intern both at Lake Region and at MeritCare in Fargo, N.D. As the director, he will be responsible for operations at Lake Region Healthcare’s outreach clinics in Minnesota including the Fergus Falls Walk-In Clinic, Ashby Clinic, Battle Lake Clinic, Elbow Lake Eyecare Center and Ophthalmology/Optometry department at the Main Clinic.

JED LAPLANTE

BCBSND NAMES HUMAN RESOURCES & DEVELOPMENT VP

WESTERN STATE BANK HIRES VP, MANAGER

CHAD MARSDEN

Chad Marsden has been named the vice president and bank manager of the Western State Bank in Fargo, N.D. His duties will include serving commercial customers while overseeing employees and day-to-day management of the Fargo location and providing customer service to current and potential clients. Marsden has more than 13 years of banking experience and most recently served as the vice president and business banking manager of Cornerstone Bank in Fargo.

MICHELLE KOMMER

Michelle Kommer has joined Blue Cross Blue Shield of North Dakota in Fargo, N.D., as vice president of human resources and development. Kommer will be responsible for leadership, direction, planning, coordination, development and proactive administration of all the human resources, corporate training and benefits management functions for the company. She has been with Otter Tail Corp. of Fargo, for the past five years. Most recently she served as senior vice president of human resources. Prior to her time there, she served as a company attorney specializing in employment matters. She has held key positions in internal audit, operations, and human resources in the financial industry, and served as an independent human resources consultant for various industries.

SEGELEON APPOINTED CHIEF MEDICAL OFFICER AT SANFORD

JOSEPH SEGELEON

12 Prairie Business

Joseph Segeleon has been appointed Sanford Children’s Hospital chief medical officer for Sioux Falls, S.D. Segeleon replaces Eugene Hoyme, who was recently named president of Sanford Research. Segeleon has served as director of the Pediatric Intensive Care Unit, or PICU, and has been instrumental in the development of the pediatric practice at Sanford Health. Segeleon’s background includes educator, administrator and physician. He worked as an assistant professor of pediatric intensive care at the Sanford School of Medicine at the University of South Dakota School from 1997 to 2002. He returned to South Dakota in 2005 as associate professor of pediatrics, chief division of pediatric critical care medicine and was promoted to professor in 2011. Segeleon was also instrumental in shaping the concept of what is now the Sanford Children’s Hospital facility. Segeleon has already started in his new role at Sanford Children’s and will maintain his role as director for the PICU at Sanford Children’s.

May 2012

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Business Development: Minot

Minot, N.D.’s main street is rebounding from a devastating flood that impacted hundreds of downtown businesses. (Photo courtesy of Minot Convention & Visitors Bureau)

Minot: A year after the flood Thriving economy before the disaster is helping recovery efforts By Alan Van Ormer

ust one year after a devastating flood, Minot, N.D., residents and businesses are in full recovery mode and the community’s economy continues to rebound. Yearend economic indicators show that unemployment dipped down from 3.7 percent in 2010 to 3.1 percent in 2011. The unemployment rate for the state was 3.3 percent and the United States 8.3 percent in 2011. In addition, building permits, as can be expected after a disaster, increased from 528 in 2010 to 1,132 in 2011. “Our sales tax numbers saw a lull in July, but in August we were at pre-flood level or higher,” says Jason Zimmerman, flood recovery coordinator for Minot. Connie Feist, general contractor for Real Build Inc. and also chair of the housing committee for Flood Recovery 2011, says the recovery has started, but “I wouldn’t say we are there yet.” On May 30, residents received their first flood evacuation notice. Seven days later the all-clear was given, but citizens were asked not to get too comfortable. The main event took place on June 22 and two days later water inundated the city and valley. There were areas where

homes had 10 to 12 feet of water in them. Almost 85 percent of the homes in the impacted area had at least 3 feet of water on the main floor. The flooding covered an area that stretched approximately 6½ miles long and 2½ miles wide. More than 4,100 housing structures and hundreds of businesses were impacted by the flood. The recovery began shortly after. The most recent support came in April, when North Dakota Gov. Jack Dalrymple, along with Minot-area community leaders and officials, kicked off the Summer of Hope Souris Valley Long-Term Recovery campaign. As part of the flood recovery effort, organizers plan to rebuild as many as 40 flood-damaged homes every month during this year’s construction season. Long-term plans are to rebuild the main living quarters of more than 500 homes. Jay Fisher, who works with the North Dakota State University North Central Regional Extension Center and was the chairman of the Minot Area Development Corp. in 2011, says the MADC, along with the Minot Area Chamber of Commerce and Minot Convention and Visitors Bureau are trying to get a handle on the situation. (continued on 16)

14 Prairie Business

May 2012

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Business Development: Minot (continued from 14)

BUSINESS NEWS

“There are issues to overcome, but there are opportunities also,” Fisher says. To find out how other communities have rebounded from flooding, the MADC, CVB and chamber studied Cedar Rapids, Iowa, and Grand Forks, N.D., both of which have successfully recovered from flood disasters. In addition, a professional survey was developed to find out the needs of the community members. About 900 surveys were sent to businesses in the community and almost 25 percent responded to the survey. According to survey results, business suffered almost $300 million worth of losses including more than $196 million in estimated revenue loss, more than $10 million in business relocation costs, more than $59 million in building repairs and remediation costs and more than $28 million in capital equipment losses. The survey also showed that 843 employees have permanently left the Minot area, 330 switched jobs and 335 employees have collected unemployment insurance due to the flood. Almost nine-tenths of businesses in the evacuation zone reported damage to facilities. For those businesses not in evacuation zones almost 15 percent reported damage to facilities. Overall, more than two-fifths of Minot businesses reported facilities damage. Within six months, more than half of all reporting businesses expect to meet or exceed preflood revenue levels. Zimmerman says withstanding that type of loss speaks to the resiliency of the people and businesses in the community. “Because of how strong the economy has been up here business owners know what the reinvestment will be,” he says. “The loss

Jay Fisher, NDSU North Central Regional Extension Center

Connie Feist, general contractor for Real Build Inc.

Jim Ondracek, Ondracek & Witwer Consulting Co.

JM GRAIN NAMED N.D. EXPORTER OF THE YEAR JM Grain, a processor and exporter of dried peas, lentils and chickpeas, headquartered in Garrison, N.D., received the North Dakota 2011 Exporter of the Year award at the North Dakota Trade Office Global Business Connections Conference in Fargo, N.D. The Exporter of the Year Award is presented to one North Dakota business each year. To win the award, the business had to: expand to a new international market in 2011; increase its export sales during 2011; and support the larger, statewide effort to expand North Dakota’s global reach. Also at the conference, the Northern Crops Institute, based in Fargo, was the recipient of the 2011 Service to Exporters Award, which is presented to an organization that demonstrates exceptional commitment to supporting North Dakota exporters and increasing the state’s international business.

16 Prairie Business

May 2012

was very significant, but because of the environment it was painfully absorbed by the business community.” The main concern now is a housing shortage that the community was experiencing before the flood and is still prevalent after the flood, and an increase in the price of lots. Two years ago, a lot cost $35,000. Today, if you can find one, a lot costs $60,000 to $65,000. Another issue that needs to be addressed is the shortage of workers. Almost half of all Minot businesses currently have too few employees. The most pressing current needs in Minot are (in order of importance) for construction, manufacturing, wholesale, restaurant/bar, hotel/motel, transportation and retail workers. The most prominent impediment to filling positions is the inability to find appropriate employees. Surprisingly, lack of housing for employees is the second-most common reason for understaffing. “I don’t think the flood will have long-term consequences,” states Jim Ondracek of Ondracek & Witwer Consulting Co., which conducted the business survey. “We will grow with oil and gas and grow into a regional service center.” Feist notes that if Minot didn’t have a thriving economy before the flood it would have been a different story for the community. “Anyone knows who has been here any amount of time we are stronger and better,” she states. “However, it is going to be expensive.” Also, many family-owned businesses in the flooded areas could have left, but stayed. Zimmerman says that is part of the entrepreneurial spirit for those in Minot and other communities across North Dakota. “They are not quitters.” PB

UNIVERSITY OF SOUTH DAKOTA ADDS RESEARCH LABS Researchers and entrepreneurs at the University of South Dakota in Sioux Falls will soon have access to additional space and resources as they grow their research programs and launch new companies. Nearly 5,000 square feet of lab and office suites are being constructed on the first floor of the University of South Dakota’s Graduate Education and Applied Research Center. The GEAR Center is located on the University Center campus in Sioux Falls, S.D. Along with specialized space that includes a clean room, dark room, cell and tissue culture suites, GEAR Center tenants also have access to business incubation services at the South Dakota Technology Business Center.

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Finance

Shopping and banking local makes sense By Joe Witt

or the past couple years, savvy business people have started several initiatives to encourage people to buy locally. We all know that Black Friday, the Friday after Thanksgiving, is a huge shopping day. Last year the following day was termed “Small Business Saturday,” a day consumers were encouraged to patronize their local small businesses. It makes good sense to actively promote supporting local businesses. Small businesses are the heart and soul of the typical Upper Midwest community. Statistics show that they are good employers: the 25 million small

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May 2012

businesses create 65 percent of all new jobs. Studies also show that for every $100 spent in a local small business, $68 dollars is returned right back to the community in the form of taxes and payroll. Supporting these local small businesses on Main Street U.S.A., just feels good. Small Business Saturday was a success. Many small businesses took part, actively promoting the day to their customers using traditional advertising as well as Facebook and other social media. There will probably always be a need for big-box retailers and large restaurant chains, but America also

needs small, local businesses that provide good products and exceptional service at a fair price. The shop local concept makes sense for banking, too. The upper Midwest is home to hundreds of small, local banks. Many of these banks have been owned by the same family for several generations. Supporting these local banks makes sense for all the reasons that you support other local small businesses. Your local banker is active in your community, and the bank does a great job of giving back to your community. When the Little League teams need new uniforms or the school band needs support, you can bet that the local bank is there to help. Local banks and local small businesses have a great relationship, which is based on mutual benefit. At its core, the banking business is fairly simple. Banks need to attract deposits that they can then turn into revenueproducing assets. The best option is for banks to turn their deposits into performing loans to individuals, families or businesses. From the banks’ viewpoint, small businesses provide a stable deposit base, and they are also good loan customers. From the small businesses’ standpoint, local banks are a great option. They are convenient depositories that can help manage the business’s cash flow needs. Also, your local bankers have a ton of expertise in making small business loans. They help businesses understand their borrowing options, including whether it is prudent to use federal government guarantee programs or local community development funds. While community banks hold just 10 percent of the total banking assets in the country, they make 40 percent of the small business loans. Let’s hope the local banks and the local small businesses continue to work well together because that will be the best way to ensure that our communities flourish. PB Joe Witt is president and CEO of the Minnesota Bankers Association. Reach him at joew@minnbankers.com or 952-857-2614.

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Economic Development

SD rolls out new project development tool By J. Pat Costello

conomic development practitioners continuously seek ways to set themselves apart. Showing an expanding company that you are home to the best project site is the goal. And, doing that in a timely and documented manner can make the difference between making the cut and being left on the cutting floor. The South Dakota Certified Ready Site Program is a new tool to help prospects find prequalified sites in an expedited manner. The Certified Ready Site Program, which took

two years to develop, is meant to be a thorough, well-designed and useful tool for developers, site selectors and business leaders. The Governor’s Office of Economic Development tested the program with six pilot sites, worked out the kinks, and is happy to now provide this top-notch service. The program certifies property all over the state that is shovel-ready and available for development. The program categorizes the certified property with development designations — heavy

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May 2012

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industrial, light industrial, business services/research and development or rural business park. Heavy industrial sites are zoned for heavy industrial or the equivalent zoning designation and generally have a significant impact on community infrastructure and are noncompatible with commercial or residential uses. Light industrial sites are zoned for light industrial or the equivalent zoning designation and typically have a small impact on a community’s infrastructure. Examples include warehouse and distribution centers. Business services/research and development sites include office, business services and support or research and development activities. Rural business parks can accommodate a variety of uses located in communities with a population of less than 5,000. Certification criteria are based on industry and economic development standards and provide consistent information on available sites throughout South Dakota. Program information, including the application can be found at www.sdreadytopartner.com/certified.

Having readily available well-packaged information to give to perspective businesses is important and can help reduce the risk of developing a particular site. Between economic development tools like this program, combined with the state’s nationally recognized business environment, South Dakota offers a compelling case for economic development. The first round of applications will be accepted May 1. Beginning July 1, local economic development corporations in addition to political subdivisions will be eligible applicants. A multi-agency review committee will certify applications for completeness and conformance with the standards. The review committee consists of subject matter experts from the South Dakota Governor’s Office of Economic Development, S.D. Department of Transportation, S.D. Department of Environment and Natural Resources and the S.D. Public Utilities Commission. Each application will also be subject to an on-site review. PB J. Pat Costello is commissioner of the South Dakota Governor’s Office of Economic Development. Reach him at pat.costello@state.sd.us or 605-773-3301.

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Research and Technology

‘To out-compete is to out-compute’ By Philip Boudjouk

usinesses of all sizes looking for an edge in today’s global market are turning to supercomputing to solve problems. In a white paper called “Global Leadership Through Modeling and Simulation,” the U.S. Council on Competitiveness says “to out-compete is to outcompute.” Using supercomputers and high-performance computing centers such as those available at North Dakota State University in Fargo can help businesses improve manufacturing processes, design better products and solve vexing problems. For example, Boeing used a national supercomputing center to accelerate design of the 787 and 747-8 airliners and Navistar Corp. designed technologies for better fuel efficiency in trucks. Regional businesses may choose to partner with university researchers to solve problems involving energy, manufacturing, polymers, health care, pharmaceuticals, agribusiness and transportation, to name a few. Significant benefits available through supercomputing centers such as the Center for Computationally Assisted Science and Technology at NDSU make available resources to model, design and investigate questions before even building a prototype. Computer modeling represents the wave of the present and the future. Such modeling can save money before conducting lab experiments. Data then has to be analyzed. Computer-based research and data storage facilities such as those available at NDSU can help make the data permanently useful for future research. NDSU’s CCAST also provides on-ramps to access even larger computational highways leading to the U.S. Department of Energy and National Science Foundation supercomputers. Such resources are potential options when partnering with university

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researchers to solve technology challenges in business and industry. These types of computing centers enhance the potential for private-sector partnering. More than 180 researchers use CCAST for work in energy applications, bone replacement research and new polymers from renewable crops in North Dakota, among others. Such facilities can also aid in development of clean energy technologies, smart-grid transmission systems, increased oil and gas production and methods to better predict wind farm production. In “The New Secret Weapon” the U.S. Council on Competitiveness notes, “Supercomputing is part of the corporate arsenal to beat rivals by staying one step ahead on the innovation curve. It provides the power to design products and analyze data in ways once unimaginable.” The council’s white paper says “we risk our manufacturing leadership position if we fail to utilize the game-changing tool of high performance computing (HPC) for modeling, simulation, and analysis.” Data storage facilities are also important for businesses and research universities. Statistics show 1,800 exabytes of information was created in the digital world in 2011, with only about 900 exabytes of available storage. For businesses of all sizes looking to improve products and processes, high-performance computing centers such as NDSU’s CCAST and data storage facilities offer opportunities to get out in front of industry challenges. Through such centers, North Dakota can be a leader in computational science that benefits both business and academia.

PB Philip Boudjouk is vice president for research, creative activities and technology transfer at NDSU. Reach him at Philip.Boudjouk@ndsu.edu or 701-2316542.

We’re Rebuilding Bigger & Better: q Construction dollars doubled to $200 million in 2011 versus 2010 q Minot International Airport is the 2nd busiest in the state (March 2012 figures) q Nearly $21 million in city sales tax collections in 2011

We’re

Looking Ahead:

q 2,000 new residential homes in 2012 estimated q 7 new hotels expected in 2012 q Population of 80,000 in Minot’s labor shed area and growing

We’re

Last summer, Minot experienced a devastating flood that damaged 4,000 homes and caused one-quarter of the city to evacuate. Because of neighbors, friends and families, national response agencies were shocked to find only 300 people using their temporary shelters. Minot’s community and economy will absorb this disaster and will be bigger, better and stronger than ever.

Grow with us: 701-852-1075 minotusa.com

Tourism

More than 19,000 skating passes have been sold at Main Street Square in Rapid City, S.D. (Photo courtesy of Megan Karbowski, executive director of Main Street Square)

Creating and sustaining regional destinations Attracting visitors takes vision, natural resources, and community and financial support By Alan Van Ormer

s their lodge was being constructed, Chris HollandMehlhaff and her husband, Scott Mehlhaff, would sit in a boat on Big Detroit Lake dreaming of what The Lodge on Lake Detroit would look like. They wanted to create something different — an affordable, upscale destination resort/hotel where guests could have an experience; not just a place to stay. Five years later, the lodge in Detroit Lakes, Minn., features 54 rooms, all overlooking the lake, works by local artists, eco-friendly rain gardens and a lakeshore planted with more than 10,000 native plants. To entertain the guests the lodge holds murder mystery events and live music nights featuring regional jazz musicians. Then there are wine-tasting events, day spas and women’s wellness weekends. The lodge also hosts corporate meetings, retreats, couples getaways, destination weddings on the beach, fishing, family reunions, scrapbooking, snowmobiling, snowshoeing and biking trails. Holland-Mehlhaff, who grew up in Detroit Lakes, also involved local contractors and artists to help create unique

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elements for guests to discover at the hotel. “We have commissioned a handmade mosaic sunset piece for every room,” Holland-Mehlhaff says. “Another artist made the furniture for our breakfast and lobby bar areas. People have taken pride in having their creative pieces incorporated and helped us create the vibe at the lodge.” The Lodge on Lake Detroit is one of many regional destinations that visitors coming to North Dakota, South Dakota and Minnesota Chris Holland-Mehlhaff and her husband, Scott Mehlhaff operate have come to enjoy. Many of Best Western Premier The Lodge these destinations continue on Lake Detroit in Detroit building a Midwest tourist Lakes, Minn.

The Medora Musical runs every evening throughout the summer. (Photo courtesy of Theodore Roosevelt Medora Foundation)

attraction. Holland-Mehlhaff grew up in the hotel business and is a thirdgeneration hotelier. In 1991, while Chris and Scott were attending graduate school at the New England Conservatory in Boston, they would come back home during breaks to help out her parents at the hotel. They’ve been in the hospitality business ever since. One mile from The Lodge on Lake Detroit is the Best Western Plus Holland House, which was originally founded in 1953 by Chris’ grandparents, Emil and Hilda Holland as a 13-unit hotel. Now with 56 units, Holland House was the first motel in Minnesota to have an indoor waterslide, and was the first Best Western in North America to display the Best Western PLUS descriptor, Holland-Mehlhaff notes. During the past 15 years, the couple and Chris’ parents, John and Kathy Holland purchased five adjacent lake lots around Detroit Lakes, plus the former Castaway Inn & Resort, which they have operated for seven years, with a vision to someday use that land along the shore to create a lodge. The Lodge on Lake Detroit opened its doors in May 2008 and is a three-story hotel built into the hills along 550 feet of lakeshore. “In order to be a destination, it has to be absolutely more than just a hotel stay,” Holland-Mehlhaff says. “We needed to create some type of activity or destination or try something new or enticing in order for them to choose to stay at our place,” she says. “We offer guests many opportunities to relax, rejuvenate and reconnect while they are here.” Atmosphere is another key element in creating a destination. “Our location is unique. We don’t know what it is, but it just feels right,” she says. “There are the sunsets, the peaceful and serene elements of water and a connection with nature.” It also helps that the downtown corridor of Detroit Lakes is being developed, allowing people more activities to enjoy and driving more traffic to the lodge. To continue to make the destination viable, the lodge evolves as guests’ needs change, Holland-Mehlhaff says. “We have to be creative. We find it fun and involve team members in creating the best experience possible for our guests.”

ENHANCING THE NATURAL LANDSCAPE Randy Hatzenbuhler, president of Theodore Roosevelt Medora Foundation, says the natural landscape in Medora, N.D., and the Theodore Roosevelt National Park naturally draws tourists to the area.

Kayaking is one of the many activities visitors can enjoy during their stay at The Lodge on Lake Detroit. (Photo courtesy of Best Western Premier The Lodge on Lake Detroit)

Medora is a small community with approximately 100 residents in a five block long by four block wide area. What it lacks in population and size, however, it more than makes up for in tourist attractions. The area has a unique landscape and has several interesting historical features including Theodore Roosevelt National Park, the Chateau de Mores, a historic home built by the Marquis de Mores in 1883, and the Medora Musical, which is performed every Randy Hatzenbuhler, Theodore evening throughout the summer. In Roosevelt Medora Foundation addition, key components that make it work include city government, private businesses and the foundation. “Medora is a vibrant community all year long, but the pace really picks up during the Medora summer musical,” Hatzenbuhler says. The musical attracts an average of about 1,000 people per evening and attendance for the season ranges from 85,000 to 110,000 people. “It is surprising the quality of shows and the professional production,” Hatzenbuhler notes. Hatzenbuhler says that the natural landscape helped create the destination for visitors. “Essentially, there is beautiful landscape and we were fortunate that there was a significant person in the country’s history that came and lived here in Teddy Roosevelt,” he says. “He loved the area and credited his time in the Badlands for being critical to his development, and even went so far as to say he would never have been president of the United States if it had not been for his time in the Dakota Badlands.” Another Medora citizen, Harold Shafer, also had a hand in making Medora into a travel destination. Shafer invested in the community, and in 1987 gifted assets to the Theodore Roosevelt Medora Foundation. “He put tremendous personal energy and financial resources into restoring this historic town,” Hatzenbuhler says. “Shafer had a strong passion for this place.” Medora also features the North Dakota Cowboy Hall of Fame, Bully Pulpit Golf Course, which was named the best public golf course in the prairiebizmag.com

Tourism country, and mountain biking and horseback riding. The main draws are the Theodore Roosevelt National Park and the annual Medora Musical that runs from June 8 through Sept. 8 in a 2,800-seat amphitheatre. The musical, along with the other attractions, provides strong patriotic themes. Another key to the success of the destination is the steady investment by Shafer, as well as businesses and other members of the community and foundation. Every three to five years another project is added to enhance the area as a destination for travelers. “We provide a good balance and have a responsibility to evolve and grow in a way that is mindful of the place as a tourist destination,” Hatzenbuhler explains. “It is a multifaceted destination. For some people it is about relaxation. Others enjoy riding their mountain bikes on the great trails.”

FOR THE COMMUNITY AND BEYOND In Rapid City, S.D., a half-block Main Street Square opened in October and has become a central gathering place in the heart of the community. It has resulted in a $1.7 million economic impact on the businesses surrounding it and has increased foot traffic downtown. “We’re bringing our downtown alive,” says Megan Karbowski, executive director of Main Street Square. “The main focus is to have an economic impact on our businesses and create a Megan Karbowski, executive vibrant business core. Businesses are director, Main Street Square seeing a 40 percent increase since the square opened.” The square includes a 7,300-square-foot ice skating rink, fountains that play 11 different songs, 25-week farmers’ markets on Saturdays, movies in the summer and activities with a street festival. There are more than 100 events slated for the year. This includes live concerts, street performers, a two-day art and wine festival in June, car show and a German beer festival. More than 19,000 skating passes have been sold and more than 40,000 people have visited the area since it opened. Main Street Square used to be a parking lot on the corner of Sixth Street and Main Avenue next to an old Sears building. The area was transitioned into a grassy oval with fountains, an ice skating rink and a concert stage area. The Sears building has been renovated and houses 11 businesses. The second level is currently being renovated. Now, Main Street Square is planning to have artists design tapestries on the granite pillars that grace the perimeters of the plaza. Artists will chisel or create pieces of art reflective of the area including the Badlands, Blacks Hills and Rapid City starting in 2013. Karbowski says that public and private funding, as well as support and backing, have allowed Rapid City to create this destination. An estimated $3.5 million has been received from both the city of Rapid City and from private donors. “Every part of the square is unique,” Karbowski says. “There is nothing quite like it. It is built to function as an events center and attract people as a destination. There is an historic feeling — built new to look old. There is that sense of community because the square was built for the community.” PB

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May 2012

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Branding

What’s in a brand?

A barn on the Laura Ingalls Wilder homestead in DeSmet, S.D., is part of the 2012 South Dakota branding campaign. (Photo courtesy of Jenna Nagel, South Dakota Tourism)

Tourism campaigns bring attention to state’s assets By Alan Van Ormer eading into the 2012 summer tourist season, state tourism departments are gearing up to show travelers why they should continue to spend their time and money in Minnesota, North Dakota and South Dakota. North Dakota is building on its “Legendary” brand, while South Dakota is unveiling a new branding theme to accompany “Great Places, Great Faces.” In Minnesota, studies are being conducted to create a brand name to work in conjunction with the state’s “Explore Minnesota” branding theme. “We’re trying to create a consistent brand that would apply to tourism, economic development and all aspects of the state,” says Leann Kispert, senior marketing manager for Explore Minnesota. “In this particular initiative, the major challenge is not just creating a tourism brand, but creating one that has to serve many purposes.” Minnesota is known for its outdoor assets and natural resources including lakes, outdoor scenery and outdoor recreation. “We have an opportunity to expand on that,” Kispert says. “We are also trying to infuse the arts and cultural attractions and urban attractions and activities into our assets.” What sets Minnesota’s brand apart from other states is what people want to read into it, Kispert notes. “With Explore Minnesota, I can explore whatever it is that interests me — outdoors, cities, small towns, north shores,” she says. “People can individualize it for themselves. I think that is what has made the brand Explore Minnesota successful.” In an effort to unify the messaging and branding for Minnesota, a task force was developed and more than 850 consumers were surveyed in Minnesota and its four neighboring states and in clusters outside of the state, which included Michigan, Nebraska and Illinois; three cities — Dallas, Philadelphia and Los Angeles. “Looking at the surveys coming in, the further out the states were the more negative the responses were about the weather,” Kispert says. “As for perception, some people don’t Leann Kispert, Explore Minnesota believe we have culture, are

sophisticated, are diverse or open minded,” she adds. “It is about awareness. We have to prove we are modern and we have the types of amenities that people would expect.” Kispert says the research is done and it is time for the creative development. “The hope is to have everything wrapped up by the end of the year and a new brand rolled out,” she says.

JOURNEY TO S.D. South Dakota’s new $3.2 million “Your American Journey” branding campaign will include print, TV and digital advertising, featuring aerial views and a new musical score. Along with targeting the regular regional areas, the campaign will focus on markets in Des Moines, Iowa, and Kansas City. “There will be less verbage and more scenery that will draw people in,” says Jim Hagen, secretary of tourism for South Dakota. “The major change is the imagery from past Jim Hagen, S.D. Dept. of Tourism campaigns. There is a different feel. The visuals are more relaxing.” Tourism is the second-largest industry in South Dakota behind agriculture. There is a $1.8 billion impact and more than 30,000 people work in the industry. Hagen notes that each household pays $1,000 less in taxes because of the tourism industry. “Tourism is economic development and is a job-creating industry,” he adds. “It also transcends into other economic development efforts.” Hagen notes that South Dakota is blessed with the natural resources that many other states do not have; beautiful rolling prairies, lakes, abundant hunting opportunities and historical culture just to name a few. The branding efforts continue to work because the state spends time delving into research and understanding what visitors are looking for in their vacation experience, Hagen notes. “(Keys are) understanding the visitor’s attributes, targeting money to key markets and knowing where visitors are coming from,” he says. “We (continued on page 44)

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May 2012

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Destinations

Art & Wine Walk, produced by the Greater Grand Forks Convention & Visitors Bureau and North Valley Arts Council, is held the third Saturday of June, July, August, September and October in the downtowns of Grand Forks and East Grand Forks. (Photo courtesy of Greater Grand Forks Convention & Visitors Bureau)

Creating regional tourism Meccas Area convention and visitors bureaus find their niches By Alan Van Ormer ommunities across the region look at a variety of different ways to attract visitors to North Dakota, South Dakota and western Minnesota. The Fargo (N.D.)-Moorhead (Minn.) Convention & Visitors Bureau is finding that online and print materials cannot stand without each other. “We have seen the printed guides decrease and digital guides increase,” says Brian Matson, marketing director for the Fargo-Moorhead CVB. “We are exploiting the online space more, but also tying things in our print to online.” In 2007, the Fargo-Moorhead CVB launched a MySpace page and since then has added different social media to go with its print editions. The CVB has seen consistent growth since that time. They now boast 6,000 Twitter followers, 17,000 Facebook followers, and 15,000 newsletter subscribers. In 2011, there was a 30 percent increase in those stepping through the doors of the visitor’s center. In addition, the CVB’s website received more than 150,000 unique visits last year. Along with print and online, the Fargo-Moorhead CVB also promotes niche opportunities. For example, the woodchipper from the movie “Fargo” Brian Matson, Fargo-Moorhead Convention sits in a corner of the visitor’s center.

& Visitors Bureau

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May 2012

“To a lot of people, the one thing they know about Fargo is the movie,” Matson says. “Finding the right niche is important.” Other activities that the CVB promotes include baseball because of the connection to Maury Wills and Roger Maris, geocaching and bird watching. “Communities can build around a niche activity,” Matson notes. “They are engaged in a community because they are passionate about that activity.” The Fargo-Moorhead area is also getting a boost from being mentioned in major magazines. For example, Business Week listed Fargo-Moorhead as America’s Most Affordable Place; Men’s Health mentioned Fargo-Moorhead as one of the least angry cities in the country; Women’s Health Magazine listed the communities as the second best city for women; Men’s Journal states that FargoMoorhead is the best place to forget the recession; Newsweek called the communities one of the nation’s new boomtowns; and Kaboom suggests the metro area is among the most “playful.” Matson notes that on top of all those accolades, FargoMoorhead has all the things that visitors expect, want and need. “We have hometown hospitality in a metropolitan style,” he says. One of the main draws to the two communities throughout the year is events and festivals. However, each season of the year attracts a different type of visitor. For example, the fall season will attract those interested in the Fargo Festival, downtown events and the lefse and lobster festival. The winter season is sports tournament time. In addition,

Fargo-Moorhead has been adding other things like snowmobile racing. The annual Fargo Marathon highlights the spring season. “It doesn’t get much bigger than that,” Matson says. In the summer comes the Ribfest, Scandinavian Festival, and Cruise and Broadway event. “It is more than just spending money in Fargo-Moorhead,” Matson says. “It is also about culture and new discoveries. It is about breaking the stereotype of what Fargo-Moorhead is. They are pretty vibrant communities. It all boils down to hospitality and all about the experience.”

VISITOR, BUSINESS EXPERIENCE Just north of Fargo-Moorhead on I-29, Grand Forks, N.D., and East Grand Forks, Minn., continue to see an increase in visitors — especially from Manitoba, Canada — and business events. Julie Rygg, executive director of the Greater Grand Forks Convention & Visitors Bureau, says depending on the year it is tough to figure out which is a bigger draw for tourists — leisure or events? What has helped the Greater Grand Forks CVB is the number of facilities that are available for Julie Rygg, communities of its size (East Grand Greater Grand Forks Forks and Grand Forks have an Convention & Visitors Bureau estimated population of 60,000) and the expanded and complimentary services those in the community provide guests who visit. “We continuously find ways to provide services and not charge those who visit our communities,” Rygg says, adding this could mean helping with hotel needs, providing banners or even providing 10,000 welcome buttons for businesses around the community during an event. “It helps bring people back when they see the community is rallying behind the event,” Rygg notes. “What sets us apart is the services that we provide.” Year around, Canadian visitors mainly from Manitoba flock into Grand Forks and East Grand Forks to shop; in part because of the convenient exchange rate, prices and selection. “We do specific promotions to make Canadian’s feel more than welcome,” Rygg says. “It is a big part of our tourism plan targeting around their holiday weekends.” For the business visitors, the facilities play a major part in bringing people to town. There are larger facilities such as the Alerus Center and Ralph Engelstad Arena that host sporting events, concerts and other major events. There are also mid-sized venues such as the Chester Fritz Arena and Empire Arts Facility, as well as smaller spots like the Burtness Theater on the campus of the University of North Dakota and North Dakota Museum of Art. “The challenge is to continue with all of these activities,” Rygg states. “We are always looking at new marketing opportunities to bring them back.” In the fall, the community hosts recreation events such as the Extreme North Dakota Adventure races and Wild Hog Grand Forks Half Marathon. “Celebrate the Night” is the annual New Year’s event that is a highlight during the winter season. Athletic events also bring visitors to town.

In the spring there are more athletic events, as well as conventions. The summer season moves the activities outdoors. It includes the annual Grand Cities Art Fest, Art and Wine Walk, Blues on the Red Summer Music Series and Town Square Farmer’s Market. There are several reasons why the tourism industry continues to flourish in Grand Forks and East Grand Forks. The Canadian exchange rate is positive, there are several options for facility use that the community didn’t have before and the CVB continues to expand its services. “We’re adding something every year,” Rygg says. “The tourism industry here works hard to keep the industry growing. We’re not just invested, the whole community is invested.”

ECONOMIC IMPACT IN BEADLE COUNTY Visitors provided more than $59.5 million in economic impact for Beadle County, S.D., last year. One of the major pieces of the tourism industry in the county is hunting. Recently, the Huron Chamber and Visitors Bureau took a look at the current pheasant hunting marketing efforts to determine its effectiveness, as well as other avenues to increase hunter visitation. “We developed a Hunt Action Team that includes people who are avid sportsmen, but also individuals with marketing expertise,” says Peggy Woolridge, executive director of the Huron CVB. Huron is the largest community in the county. “With help and assistance from the South Dakota Department of Tourism, we developed and launched a comprehensive marketing strategy to help boost and sustain the already strong hunting economy in Huron.” One of the objectives was to create a brand, something that sets the region apart from other hunting destinations. As a result, “Huron Ringneck Nation” was established. “It is going to take time to establish it as our identity and brand but that will come with consistency as we continue our efforts,” Woolridge says. “Another objective we wanted to accomplish was to capture data from not only people seeking hunting information about our area but also information from present out-of-town hunters. This information will be very helpful in understanding ‘who’ our hunters are, where they come from, their preferences and how they heard about us. This will be valuable information as we move forward.” Woolridge adds that what sets the region apart is its central location that makes it a hub for prime pheasant habitats and other hunting opportunities. “Looking at stats from the state’s Game, Fish and Parks, we have more pheasants than people,” she says. In July, Huron CVB started media buys and also created a dedicated hunting website; launching that in September. Earlier last year, Huron CVB also changed the newsletter format to a regional newsletter magazine, which included the trade area around Huron. Woolridge says it is important to have a program that attracts visitors. “Travelers today are more dynamic and unique than ever. They are exposed to hundreds of marketing messages everyday through every form of media, all wanting to capture their attention and trigger something to influence their buying decisions,” she explains. “This is all the more reason to take a strategic approach to reaching your target audience otherwise it is really easy to get lost among the masses.”

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Photo Illustration by Growth Energy

One step closer to E15 Growth Energy expects few remaining regulatory hurdles to be cleared soon By Alan Van Ormer he U.S. moved closer to widespread use of 15 percent ethanol blended fuel (E15) when the U.S. Environmental Protection Agency gave the green light to manufacturers to register as suppliers. Currently, most gasoline sold in the U.S. is blended with 10 percent ethanol. Although there are still a few regulatory hurdles that need to be cleared before E15 can really start to flow, supporters are pumped about the latest EPA approval. “E15 is just now becoming available and the approval process is just underway,” says Tom Buis, CEO of Growth Energy, an organization that represents 75 ethanol plants across the nation. “After all the regulatory hurdles are cleared, we should have it approved relatively soon. Retailers may have to make modifications at their stations, and then it is just up to the marketplace. We can compete because we are the cheapest fuel in the world.” Once all the regulatory hurdles are cleared, E15 can be used in cars and light trucks made in 2001 and later. Kent Satrang, CEO and general manager of Petro Serve USA,

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May 2012

headquartered in Moorhead, Minn., says there is still a “cloud” hanging over the E15 fuel. “Until all litigation hurdles are cleared, we won’t be able to put it in all of our stores,” he says. In March 2009, the process was started to make E15 available to consumers. A waiver was approved in 2011, however, other regulatory hurdles still needed to be cleared, including health effects testing. In February, the EPA approved health effects testing allowing retailers to register to use the fuel. Now, there are parties filing registrations with the EPA to start selling E15 fuel. “It will be slow at first, but we think the economics will drive it,” Buis explains. Growth Energy says that moving from 10 percent to 15 percent, means that 7 billion fewer gallons of fuel will be imported from other countries. “It will indirectly and directly create 130,000 new jobs,” Buis adds. “Currently, at 10 percent, the ethanol industry is responsible for 400,000 jobs.”

SELLING E15 FUEL IS VOLUNTARY. Satrang supports ethanol and the 21 convenience stores Petro

Serve USA operates in North Dakota and western Minnesota sell different blends of ethanol. There are an estimated 250 ethanol blender pumps in North Dakota and Petro Serve USA has 62 of those at its convenience stores. Satrang says Petro Serve USA offers ethanol for consumers as a choice, adding that market access is one of ethanol’s limitations. In addition, Satrang says that in order for it to work there needs to be the “perfect pump.” The perfect pump, according to Satrang, would have a choice of 100 percent gasoline, 10 percent ethanol and premium gasoline on the left side and on the right side would be E15, E30 and E85. “Developing a perfect pump will solve all of these problems,” Satrang says. “It is going to happen. There is no reason why you can’t use E15 in all cars.” Across the country right now supply is exceeding demand. “As an industry we have to ship some of our production overseas so a domestic increase in demand would be welcome,” says James Seurer, CEO of ethanol producer Glacial Lakes Energy LLC in Watertown, S.D. Glacial Lakes Energy operates a 100-milliongallon plant in Watertown and another in Mina, S.D. “E15 is absolutely good for us and we believe it would be good for our country. A benefit would be that it might ease prices at the pump.” “Convenience stores and gas stations can manage the higher blend level,” he explains. “For the public, E15 blend performs no differently than E10. The best example of using E15 is NASCAR. For the past two years they have been using E15 and have had no issues associated with it. In addition, we have many in this area who use blends as high as E30 in non-flexible fuel and older vehicles with no issues.” Buis says a major challenge is marketing. “In addition, you have to get retailers convinced it is going to be a money maker for them and that they can move the fuel,” he explains. He sees the possibility of increased types of businesses such as ethanol equipment manufacturers, suppliers for feedstocks to make ethanol and increased business in the transportation sector. “We have created new domestic demands that create jobs and can be profitable in the marketplace. Retailers can benefit because they are able to offer E15 5 to 15 cents per gallon cheaper, which means more business.”

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Building on bioprocessing SDSU envisions multiple approaches to making bioproducts By Alan Van Ormer SDSU researchers Jim Julson, in foreground, and Tom Schumacher monitor microwave pyrolis to create biochar. The process holds great promise to encourage new business in the region. (Photo courtesy of SDSU)

esearchers at South Dakota State University in Brookings, S.D., are working with the U. S. Department of Agriculture to look at receiving, sorting and pre-processing feedstocks to break them down into bio-oil, syngas and biochar. “Those living in the prairie region tend to look at things optimistically,” says Tom Schumacher, retired SDSU professor and director of the project. “We are looking at an idea that could stimulate the creativity of people who are here in this region.” The research group is using funds from the South Dakota Agriculture Experiment Station, USDA National Institute of Food and Agriculture, USDA Natural Resource Conservation Service, and the Sun Grant Initiative through the U.S. Department of Energy. The researchers will look at multiple approaches to using pyrolysis. Pyrolysis is a process that uses elevated temperatures in the absence of oxygen to break down organic materials like corn stalks or native prairie grasses. The SDSU study will more specifically use a technique called microwave pyrolysis that heats the feedstock by exciting the individual molecules, making it very accurate and easy to control, according to a SDSU press release. Schumacher is envisioning something similar to a grain elevator system in rural communities where feedstocks would be collected. Those feedstocks could then be processed into products such as bio-oil, which can be shipped like crude oil to a central refinery. Syngas, a product that burns like natural gas could be used as the energy source to power the pyrolysis process and biochar, which could be used as a soil amendment capable of

34 Prairie Business Energy

May 2012

maintaining or increasing the productivity of the soils, could be produced. Schumacher will lead the $1 million, five-year research effort funded by a USDA NIFA national competitive grant program. Along with Schumacher, project researchers include Jim Julson, Lin Wei, Sharon Clay, Dave Clay, Doug Malo, Rajesh Chintala and Ron Gelderman from SDSU, and Sharon Papeirnik from the USDA Agricultural Research Service’s North Central Agricultural Resesarch Laboratory in Brookings. Schumacher thinks there is a market for each of the energy sources including the biochar. According to a press release, researchers hypothesize that biochar has different physical and chemical properties depending on the feedstock and the way it is processed that could affect its usefulness as a soil amendment. The researchers will examine the characteristics of biochar from three feedstocks: corn stover, switchgrass and woody biomass. “Another possibility is taking syngas and upgrading it into other products that can be used in the chemical industry,” he notes. Schumacher feels the refined bio-oil can be used as a drop-in fuel much like gas or diesel. It can also be used as a chemical feedstock for the chemical industry. He also says that this is research that is looking 10-20 years into the future and could generate future jobs. “It could amount to a new kind of business that might not be in existence now,” he says.

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Sharing airspace Regional integration important for unmanned, manned aircraft By Alan Van Ormer

irspace will be a key component if the region’s unmanned aircraft systems programs are to move forward. This is one of several topics that will be addressed at the Red River Valley Research Corridor’s 2012 Unmanned Aircraft System (UAS) Action Summit on May 22 and 23 at the Alerus Center in Grand Forks, N.D. Eric Icard, senior business development officer for the Grand Forks Region Economic Development Corp., says it is important for the region to integrate the national space system to fly unmanned aircraft with manned aircraft. As early as September, North Dakota officials should know if the region’s airspace will be one of six chosen by the Federal Aviation Administration to research. “This will allow us to broaden our ability to develop non-DOD (U.S. Department of Defense) related industries in the region’s airspace,” Icard says. Joshua Simmers, manager of aerospace business development for the North Dakota Department of Commerce in Bismarck, N.D., says the industry is ready for growth in the private sector, but in order to grow there has to be space in the sky to fly the unmanned aircraft. “The summit helps bring together those who develop ideas that

36 Prairie Business UAS

May 2012

William Semke, associate professor in the mechanical engineering department at UND, watches Kaci Lemler (mechanical engineering master’s student) and Kevin Ivanca (electrical engineering master’s student) work on one of UND’s Unmanned Aircraft Systems. (Photo courtesy of Jackie Lorentz, UND)

the FAA is looking for to develop this airspace integration,” he says. Simmers adds that there has been job growth in UAS development throughout the state. “Just a couple of areas in which we have had tremendous opportunity are energy, law enforcement and emergency preparedness.” Another key component dealing with airspace is sense and avoid; a subject that will be discussed at length during the summit. Regulations require pilots to see and avoid. Since there is no pilot onboard remotely piloted aircraft, technology is being developed that

will help the aircraft detect obstacles and avoid them while in the air. William Semke, associate professor in mechanical engineering at the University of North Dakota in Grand Forks, notes that programs dealing with sense and avoid are needed. “Algorithms on board the aircraft sense the presence of a potential obstacle and redirect the plane to avoid the obstacle,” he says. Semke is one of many who have been working on the technology to assist with sense and avoid. For example, a camera system has been developed that has greater resolution and is able to generate more data to assist with sense and avoid techniques. He is also developing a system that can help with safety levels of all aircraft. “Sense and avoid may be an added benefit to manned aircraft,” Semke says. “The sense and avoid portion of airspace is a major challenge,” he notes. “For example, if something gets in the way, the aircraft may not know it is there. If there is a malfunction, what will the aircraft do? For example, if the engine dies where will it land?” Semke adds, however, that the aircraft is reliable, sophisticated and has come a long way since its origins.

A game-changing industry UAS have potential to drive economic growth in the Red River Valley By Ryan Aasheim

ftentimes you cannot see or hear them, yet, they have transformed the battlefield, assisted emergency responders to save lives, helped guard our national borders, monitored crops and helped apprehend criminals — all without putting a single pilot in harm’s way. I am talking, of course, about Unmanned Aircraft Systems or Remotely Piloted Aircraft as they are referred to by the U.S. Air Force. UAS is a rapidly evolving technology platform with huge market potential and applications across many industries. These themes and more will be explored at the 2012 UAS Action Summit — From Battlefield to Farm Field — at the Alerus Center in Grand

Forks, N.D., on May 22 to 23. This sixth Red River Valley Research Corridor UAS Summit will be co-hosted by the city of Grand Forks, the Grand Forks Region Economic Development Corp. and honorary co-hosts U.S. Sens. Kent Conrad, D-N.D., and John Hoeven, R-N.D. Currently, the military is the most active user of UAS, conducting operations in combat zones around the globe. The Grand Forks Air Force Base is home to Northrop Grumman’s Global Hawk as well as Custom and Border Protection’s deployment of the Predator, a General Atomics Aeronautical Systems UAS. The North Dakota Air National Guard runs a General Atomics Predator flight (continued on page 38)

prairiebizmag.com

(continued from page 37)

operations squadron. Clearly, the Red River Valley is a national hub of UAS operations. However, there is growing potential for UAS in the private sector where innovation will drive the supply and demand for gamechanging UAS technologies. Familiar activities such as shipping, transportation, crop monitoring and field management, law enforcement, emergency and fire rescue, and disaster recovery will be transformed by the use of UAS technology. The implications for the region are tremendous in terms of potential economic growth and technology development with a bounty of opportunities in engineering, training, testing, maintenance, manufacturing, computing, electronics, sensors and software development. Building on programs offered at the University of North Dakota in Grand Forks and Northland Community and Technical College with campuses in East Grand Forks and Thief River Falls, Minn., including pilot training, payloads, sensor operations and aircraft maintenance, the region is ramping up to provide a full complement of activities to make the region a destination for all things UAS. Aasheim is a staff member of the Red River Valley Research Corridor. Reach him at ryan@praxissg.com or 701-499-6994.

UNMANNED AIRCRAFT SYSTEMS

The LEADER in UAS Research and Development

www.uasresearch.org 38 Prairie Business UAS

May 2012

In the spirit of collaboration GFMEDC head has experience in uniting business and university communities By Alan Van Ormer

he Greater Fargo (N.D.) Moorhead (Minn.) Economic Development Corp. chose Jim Gartin as its president because of his experience in economic development and in creating opportunities for collaboration among universities and businesses. Coming from Adrian, Mich., where Gartin was the president and CEO of the Lenawee Economic Development Corp., he focused on businesses retention and expansion, business attraction, entrepreneurial support and workforce development. “The foundation of economic development doesn’t change,” Gartin notes. “I am here to work to expand, grow and maintain existing businesses, as well as help the economic development corporation continue building a foundation for wealth creation.” Gartin, 62, graduated from Ohio State University in Columbus with a degree in social work. He has 30 years of experience in the commercial real estate business, where Gartin says he learned how to attract businesses. “The real estate business provided me a broad experience and understanding of any type of market,” he says. “It provided me the basis and foundation to understand what new business is looking for in the marketplace.” What drew Gartin to the Fargo-Moorhead region was the personality of the people, especially their friendliness. “There is a collaborative nature of those who live in Cass County (N.D.) and Clay County (Minn.,)” he states. “The community working together is probably the single most important factor in my decision.” One reason that Gartin was chosen to be the next leader of the GFMEDC was his expertise in developing collaborative efforts between the business community and the University of Michigan in Ann Arbor; particularly in research capabilities. This included developing opportunities for research and helping with commercialization processes; the same processes that GFMEDC is developing with North Dakota State University, Minnesota State University in Moorhead and Concordia College, also in Moorhead. In a press release, Brad Schlossman, chairman of the GFMEDC and president and CEO of West Acres Development in Fargo, says Gartin’s experience is a great match for our strategic direction, and his collaborative style was welcomed by those who were able to meet with him during his visits. The mission of the GFMEDC is to grow the economy of Cass and Clay counties through the attraction, expansion and retention of primary-sector businesses. A primary-sector business is one that brings new dollars into a community through the sale of its goods and services outside the trade area. The primary sector is the

Jim Garton, president, Greater Fargo Moorhead Economic Development Corp.

foundation of an economy and the principal driver of community growth and development. Gartin notes that the GFMEDC has a great foundation. One of the areas he hopes to continue building on is a strong workforce, which includes plans to continue to build upon the various programs. “It is important to build a strong relationship with primary and secondary educators,” he says. “I want to also look at best practices across the country and implement them in Fargo-Moorhead.” Gartin, who just started in March, is still learning about the region and the challenges it faces in terms of economic development but notes that workforce was always a challenge in Michigan because of its high unemployment rate. He says workforce is going to be a challenge in Fargo-Moorhead because of its low unemployment rate. “Workforce is certainly going to be a challenge but one that we are excited to tackle,” he says.

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Creating value-added opportunities Minot ag processing facility will handle 100,000 metric tons of beans and peas By Alan Van Ormer

nited Pulse Trading Inc. has plans to develop an ag processing facility in Minot, N.D., to process beans, peas and other specialty crops produced in the

region. Bismarck, N.D.-based United Pulse Trading, which also has a processing facility in Williston, N.D., expects to start operations in August in the Minot Value-Added Agricultural Complex. The facility acquisition and construction will cost $12 million and the plant will employ 40 to 45 people, according to the company. The new plant will handle 100,000 metric tons of product per year. It will include processing equipment for beans, chickpeas, peas and lentils and will add capacity for making food ingredients such as flours, proteins, starches and fibers. “Our company has expanded tremendously over the past 10 years,” says Eric Bartsch, who is general manager of United States operations for United Pulse Trading and is based in Bismarck. “Minot looked like an obvious choice for us.” Bartsch notes that access to container freight and the Burlington Northern Santa Fe main rail line in Minot were important factors in determining the facility’s location. In addition, Minot has easy access to lentils, chickpeas, peas and dry edible beans, he says. Jay Fisher, who works with the North Dakota State University North Central Research Center in Minot, says the ag economy is strong. “With an estimated 7 billion people in the world, this is an opportunity for this region of the world to have an ag impact on the rest of the world,” he says. Jerry Chavez, president and CEO of the Minot Area Development Corp., says as the world and economies start to grow there are more opportunities for states like North Dakota to export its commodities. “We can push food products to worldwide markets,” he states. “A lot of what we are doing is going to emerging markets.” The ag processing facility helps Minot fulfill part of its

40 Prairie Business

May 2012

“As a region, by diversifying our ag economy industry around ag processors it will grow and give our producers a market.” Jerry Chavez Minot Area Development Corporation

economic development strategy that includes providing value-added opportunities for area farmers, developing an oil industry, becoming a knowledgebased region and starting a distribution and warehouse center. “It is all part of our strategy for diversifying our economy by attracting ag processors to conduct business in Minot,” Chavez says. “As a region, by diversifying our ag economy industry around ag processors it will grow and give our producers a market.” United Pulse Trading is one of 29 facilities owned by Alliance Grain Traders Inc. based in Regina, Saskatchewan. Alliance Grain Traders is one of the largest lentil and pea splitting companies in the world. The company purchases lentils, peas, beans and chickpeas from farmers around its 29 facilities located in Canada, the United States, Turkey, Australia, China and South Africa and ships them to more than 100 countries. Recently, a Minot delegation visited Mersin Province in southwestern Turkey along the Mediterranean Sea to look at the country’s model for developing ag processing facilities. Chavez says Turkey has a big market worldwide in peas and lentils that provide protein for Turkish citizens. In addition, the rotation of the crops places nitrogen back into the soil making it better for the farmers, Chavez notes. While in Turkey, officials were able to tour an ag processing facility and learn more about the industry.

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Retread tire company growing TreadWright received much-needed capital to expand capacity and operations By Alan Van Ormer

Sales at TreadWright Inc. grew more than 40 percent in 2011. (Photo courtesy of Pine Street Growth Partners)

readWright Inc., a South Dakota company that sells retread tires, is experiencing phenomenal growth. The Hot Springs, S.D.-based company recycles top name brand tire casings and uses high-grade commercial truck tire rubber for the tread. “With the economy down, most people just don’t have the kind of cash to spend on a new tire and they can get the same mileage with a retread,” says Joel Hawkins, vice president of TreadWright. “Overall quality and performance is comparable to any new tire with similar tread design but most consumers just aren’t aware of the retread option.” TreadWright manufactures retread tires for light trucks and SUVs. Customers purchase the tires over the phone or through

42 Prairie Business

May 2012

the company’s website and the tires are sent directly via FedEx to U.S. and Canadian customers. In 2011, company sales were up more than 40 percent from 2010 and management anticipates continued high growth with a goal of exceeding $25 million in annual sales. Growing sales is also driving expansion and the company expects to more than double its employees in the next couple of years. TreadWright, which was based in Colorado, has been in business since the 1970s. In 1997, the company moved to Edgemont, S.D., and launched its first webpage, which has since become fully ecommerce-enabled, and changed the company’s business model from wholesale to mail-order/direct-to-consumer. In 2010, TreadWright outgrew its 7,000-square-foot facility and relocated to a 30,000-square-foot facility in Hot Springs. In addition, the company’s manufacturing focus evolved from predominantly passenger car tires to light trucks. Today, the company is shipping as many as 200 tires a day during the winter months, compared with 50 to 70 tires a day in 1997. By August, the company plans to bring new production equipment on-line that will allow it to double its current tire production capacity of 75,000 tires per year. With high growth and the need to expand both capacity and the overall operational platform also came the need for capital. “In order to be able to continue to grow and meet the market demand, we need additional capital and more equipment to expand our manufacturing capacity,” Hawkins says. That’s where Denver-based Pine Street Growth Partners, a middle market private equity firm, entered the picture. Pine Street Growth Partners was founded in 2011 and invests in small businesses with high growth potential. In TreadWright, the firm saw a proven and profitable product in a market with both strong historical growth and continued opportunity over the long term. Brian Burns, a partner with Pine Street Growth Partners, says his firm’s approach is to work with small businesses that traditionally don’t have the same access to capital as larger companies. “The economics are so compelling — because TreadWright is essentially recycling tires, it can offer a product that matches the quality and performance of a new tire at a much lower price,” Burns notes This is the first South Dakota company that Pine Street Growth Partners has worked with. The firm typically invests in companies that have between $5 million and $30 million in annual sales.

Branding (continued from page 28)

are focusing in the right markets with the right messages.” A major challenge is continuously staying relevant. “We always want to make sure we are staying fresh and staying relevant,” Hagen says. “We need to keep things lively and new and that is one of the reasons you are seeing a new campaign this year.”

CREATING THE LEGEND Ten years ago, North Dakota Tourism turned research into results, launching a “Legendary” branding campaign that has converted a once-unknown state into one of the nation’s fastestgrowing travel destinations. The Legendary brand was developed from research indicating that consumers’ perceptions of North Dakota included legends, stories, history and culture. North Dakota Tourism Division Director Sara Otte Coleman says the Legendary brand is still working a decade after its launch. “Legendary helped us define North Dakota,” Otte Coleman says. “It includes authentic experiences, people and friendliness, as well as our rich history and culture.” Research has shown an incredible return on investment. Most recently, the 2010 campaign resulted in more than 1 million visits and $123 in visitor spending for every dollar spent

on advertising. Research by North Dakota State University and the United States Travel Association indicate tourism in North Dakota is making strong and steady growth. In 2008 and 2009, the most recent years in which USTA data is available, North Dakota led the nation in growth in visitor spending and visitor-generated taxes, jobs and payroll. Diversity is one of the key elements to the success of the Legendary brand. “The history of Lewis and Clark and Theodore Roosevelt is legendary, but so is UND (University of North Dakota) hockey, Roger Maris and White Cloud,” Otte Coleman says. Studies show visitors come to North Dakota for outdoor recreation, general touring and experiencing the many festivals and events. While Legendary works to communicate the overall personality of the state, the major challenge involves improving awareness of what North Dakota has to offer. “We are working to make people aware that we are a destination,” Otte Coleman says. “Right now, North Dakota is getting a lot of attention as our strong economy has set us apart. We are considered exotic, different and intriguing.”

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By the Numbers EMPLOYMENT

(NOT SEASONALLY ADJUSTED) UNEMPLOYMENT RATE Feb. 2012 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

3.9 % 4.3 3.8 5.2 4.3 2.1 0.9 4.4 4.4 5.0 4.8 5.1 4.1 4.1 5.0 5.0 4.2 3.7 4.4 3.9 3.7 6.6 6.2 10.2 5.7 7.7 6.6 6.8 8.5 6.3 8.3 5.7 5.3 6.5

EMPLOYMENT

Feb. 2011

Feb. 2012

4.2% 4.5 4.2 5.0 4.4 2.5 1.4 4.6 5.2 5.6 5.5 5.7 4.3 4.2 5.4 5.1 4.9 4.3 5.2 4.2 3.9 7.4 6.9 11.6 6.6 8.7 7.5 7.3 9.3 7.7 10.0 6.4 5.9 7.3

368,597 116,799 60,528 51,009 29,185 18,107 30,854 10,343 13,778 420,115 125,135 63,230 22,125 18,680 17,965 12,535 12,450 11,730 11,075 9,445 7,625 2,751,468 1,731,925 41,815 27,679 27,988 24,341 22,270 20,473 19,133 18,501 14,235 10,920 10,374

Feb. 2011 357,786 116,817 60,985 53,369 29,945 15,906 20,755 10,544 11,585 414,757 121,360 61,600 22,515 18,390 17,510 12,850 12,365 11,985 11,150 9,380 7,545 2,731,340 1,711,767 40,144 25,813 27,393 23,941 21,856 20,470 18,360 16,858 13,665 11,079 10,336

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

CANADIAN BORDER CROSSINGS AUTOMOBILES

TRUCKS

FEB 2012

% CHANGE /FEB 2011

FEB 2012

% CHANGE /FEB 2011

32631 20696 11255 9431 3339

14.25% 3.88 0.20 0.20 10.05

1546 999 619 968 584

- 1.97% -11.12 -28.02 - 8.51 6.38

22813 4023 4220 3566 2462

20.33 2.34 24.08 6.26 5.21

15849 616 2109 759 925

1.12 -39.84 7.16 0.93 505.23

NORTH DAKOTA OIL ACTIVITY Production Oil/BBL/Day

Production Gas/MCF/Day

JAN 2012 DEC 2011 JAN 2011 DEC 2010 JAN 2010

546,047 535,048 342,088 343,867 235,925

577,539 544,900 339,028 341,990 254,686

JAN 2012 DEC 2011 JAN 2011 DEC 2010 JAN 2010

Permitting Wells 170 180 142 134 101

Source: NDOMB

Sweet Crude Price $88.09 $88.57 $80.02 $81.03 $68.57

Rig Count 3/4/12

Rig Count 200 199 163 163 81

207

FEBRUARY AIRLINE BOARDINGS BOARDINGS

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

% CHANGE/2011-2012

1,178,489 32,597 37,500 14,290 17,039 11,680 12,224 17,165 693 1,899

5.77% 7.70 28.8 - 2.30 12.62 4.14 30.01 84.79 -37.40 14.00

Source: US Customs and Border Protection

MINNESOTA

Intl Falls-Rainer Grand Portage Baudette Warroad Roseau NORTH DAKOTA

Pembina Neche Dunseith Walhalla Noonan

Source: US Customs and Border Protection

46 Prairie Business

May 2012

CANADIAN EXCHANGE RATE 03/30/12

02/29/12

03/30/11

U.S. to Canadian Dollar-

$0.9991 or $1.0009$0.9866 or $1.0136$0.9714 or $1.0294

U.S. to Euro

$0.7500 or $1.3334 $0.7486 or $1.3358

$0.7095 or $1.4094

U.S. to Chinese Yuan

$6.2995 or $0.1587 $6.2921 or $0.1589

$6.5591 or $0.1525

U.S. to Japanese Yen

$82.955 or $0.0123 $81.135 or $0.0123

$82.955 or $0.0121

U.S. to Mexican Peso

$12.812 or $0.0781 $12.795 or $0.0795

$12.812 or $0.0781

Source: Bank of Canada

Data provided by Kingsbury Applied Economics