Prairie Business February 2015

Help your high school senior take their next step to an in-demand career in North Dakota.

Chances are, you and your high school senior have a lot of questions about attending college. North Dakota community colleges can make your decision easy.

•North Dakota community colleges can put your student on a career fast track.

•Credits easily transfer to 4-year universities.

•Five campuses with unique learning and living experiences.

•Students may be eligible for a $1,500 tuition grant.

To learn why a North Dakota community college is a smart choice, visit:

n dc om mun itycollege s .info/deman

KRIS BEVILL

KOST

million annually to a unique student loan consolidation program. PHOTO: BANK OF NORTH DAKOTA

KRIS BEVILL Editor kbevill@prairiebizmag.com

Onward and upward

One of my first assignments after joining this magazine was to attend the lavish groundbreaking celebration for Sanford’s Fargo Medical Center. It was a much to-do affair, part pep rally, part concert for the organization’s thousands of employees who were bused in from throughout the northern Plains to take part in the celebration. I remember looking across the area destined to become the medical center, which more closely resembled a music festival venue at that time, wondering how a multi-story, half-billion-dollar medical center would fit in to its surroundings and whether the project would advance as predicted. Two years remain to completion, but the trampled grass I stood on that hot July night has since been replaced with mounds of moved Earth, massive machinery and a towering multi-story steel structure. Progress is most definitely being made on this project, which ranks among the largest health care construction projects in the country and is so far on schedule and on budget, according to Sanford officials. Read “Reshaping Fargo’s skyline” for an update and description of what Sanford leaders believe will make this medical center uniquely suited for patient care.

Workforce continues to make its way into every issue, but this month we are happy to deliver some positive forward movement in efforts to resolve the regional shortage of skilled workers. Rob Swenson covers South Dakota’s recently announced Build Dakota scholarship program in his feature, “Taking Aim at Workforce Shortage.” The program, launched through a 50-50 partnership between the state and its most prolific philanthropist, Denny Sanford, will provide full scholarships to the state’s technical schools for 300 students every year for five years, after which an endowment fund will provide 50 full-ride scholarships annually. The program presents some solid movement toward recognizing the need for workers. Of course, the critical shortages being experienced throughout industries in the area will not be entirely solved by 300 students a year, but it’s a step in the right direction.

Entrepreneurs Wanted

Put your ideas to work.

The NDSU Research and Technology Park is changing the way you do business. We help entrepreneurs and start-ups in high-tech industries gain a foothold and move onto solid financial and operational ground. At the same time, we enable established companies to advance their research and development initiatives with:

• Technology innovation, commercialization, licensing and joint venture opportunities

• Entrepreneur Program - comprehensive business assistance, market research, educational events, mentoring and networking

• Financing, venture capital and strategic partnerships

• Access to talent

RESEARCH AND TECHNOLOGY PARK

FOR MORE INFORMATION

www.ndsuresearchpark.com

CONTACT NDSU RESEARCH AND TECHNOLOGY PARK

701.499.3603 | brenda@ndsuresearchpark.com

You can’t talk about higher education without at least thinking about student loan debt, so this issue also includes a look at an innovative program launched recently by the Bank of North Dakota to help state residents pay back their loans. The DEAL One program is geared specifically toward North Dakota residents, which could also boost the state’s efforts to attract and retain workers. Read “Lessening the Student Loan Load” for details.

Finally, our Business Insider this month is Klaus Thiessen, CEO of the Grand Forks Region Economic Development Corp. He was recently honored by the North Dakota commerce department as the state’s economic developer of the year and is likely to be in the news frequently this year as his group leads efforts to expand the region’s unmanned aircraft systems (UAS) industry and continues to pursue opportunities to diversify and strengthen the northern Red River Valley’s hub city. Read “GoTo Guy” to learn why the UAS industry, and Grand Forks businesses in general, are in good hands.

KORRIE WENZEL, Publisher

KRIS BEVILL, Editor

BETH BOHLMAN, Circulation Manager

KRIS WOLFF, Layout Design, Ad Design

Sales Director: JOHN FETSCH

701.212.1026 jfetsch@prairiebizmag.com

Sales:

BRAD BOYD

western ND/western SD 800.641.0683 bboyd@prairiebizmag.com

NICHOLE ERTMAN

eastern ND/western MN 800. 477.6572 ext. 1162 nertman@prairiebizmag.com

Editor:

KRIS BEVILL

701.306.8561 kbevill@prairiebizmag.com

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.

Subscriptions 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

designing solutions for 60 years

Providing

Growth targets

BY MATTHEW D. MOHR

Determining reasonable growth targets for any business is an important task. In today’s market, business growth is a key indicator of success. What growth (or decline) to anticipate and demand from employees is critical for proper planning. Wall Street financiers are rewarding sales growth, even if unprofitable or unsustainable, with high stock prices (valuations).

Evaluating some of the current high-growth enterprises will shock a disciplined financial manager. A few companies traded in the public markets have high valuations (especially e-commerce) which are not supported by fundamental value, cash flow or profits.

Our region has had phenomenal growth over the last decade and, as a result, business owners are addressing how to grow and/or how to profitably keep up with increased demand. During one recent business review a business manager was discussing his plan to add volume this year. He said the market looks to support 14 percent increases again, but due to people constraints — the ability to find

quality employees — and the high cost associated with new business development, he decided on a 7 percent growth plan. This is actually a good strategy; he is going to work for sustainable, long-term relationship-based growth which will be profitable over time.

Years ago Linden Boyd, a regional business consultant, addressed this positively as “five yards and a cloud of dust” verses a Hail Mary or an attempted 50-yard touchdown pass.

A wealth-building stock portfolio is much more likely to be built by continually buying established “Blue Chip” stocks over time rather than putting everything you have into the newest hot Russian hedge fund and hoping to get rich!

Continually grinding out reasonable growth may not be as exciting as making the big play, but continual strategic profitable growth based on long-term sustainable business strategy leads to success. PB

Matthew D. Mohr CEO, Dacotah Paper Co. mmohr@dacotahpaper.com

Expect More From Your CPA Firm

The new year of disruption

BY SCOTT KOST

Another year has come and gone, and as we continue to strategize 2015, it is important to not only reflect on the current status of your business but also ensure that you are aligning your objectives to the correct emerging technologies.

Interestingly, there is a growing pattern beginning to develop in today’s technologies, a focus around three key areas: real-time, social and mobile. Nearly every emerging technology has at least one of these underlying elements, and together, it is shaping the marketplace in vast ways. This upcoming April also marks the 50th anniversary of Moore’s Law which explains that every two years processing capabilities will double, and this exponential improvement projection has proven accurate through half a century.

These are the factors that are disrupting the marketplace today and creating an extraordinary opportunity in technology trends. Not only is there a central influence from the three leading trends — real-time, social, and mobile — impacting today’s emerging technologies, but there is also external pressure from Moore’s Law compounding capacity for unprecedented growth in computing, storage and bandwidth functionalities. This dual impact from the inside-out as well as the outside-in is generating a unique climate for emerging technologies to flourish in unparalleled ways.

Big Data

Not only are smart machines like IBM’s Watson changing the way we look at data and cognitive computing, but the growing presence of algorithms in our daily lives will create tailored messaging across devices and audiences. Consumer behavior and engagement is changing how the market views the traditional relationship between user and device. In 2015, we will see a greater shift to a consumer-centric focus on personalized content and storytelling by

device and interest areas via algorithmic curation of big data.

Wearables

Wearable technologies are continuing to gain traction in development, relevance and consumer adoption. Technologies that blur the line between smartwatch and wellness tracker are being truly useful by improving user’s wellbeing and efficiencies in unique and actionable ways. Additionally, new markets, such as wearables for children and professional athletic associations, indicate a growing acceptance across demographics. Recently unveiled at the 2015 Consumer Electronics Show, Bluetooth wearable adhesive bandages will have dramatic implications on health care and sports medicine fields.

Ambient Proximity

The next generation of geo-location has arrived. Ambient proximity is taking geo-location and push notifications to the next level via beacons that send and receive information from individual’s mobile devices. Imagine shopping and receiving dedicated information from your smartphone on specials, product-specific information, recommendations and even styling suggestions synced directly from Pinterest. From a retailer perspective, these beacons will provide a new channel to gather data on your customer — everything from the number of touches on a new display to the average time consumed per product and the ability to cross-sell and up-sell directly to the customer based on real-time data.

Security

The numerous wide-sweeping cyber-attacks of the past year, from Heartbleed to Shellshock, indicate a key focus moving forward on prevention and vulnerability detection. It will be business critical for organizations across industries to conduct regular, weekly security checks in 2015, especially as more personal data is being transferred and

Scott Kost

stored over the cloud for financial, government and health care institutions.

The Cloud

An effective, simple storage solution, the cloud will continue to see a growing number of applications being built on its platform over conventional on-premise software installs. Additionally, 2015 will introduce seamless indexing and sharing of content across devices on the cloud. Music, videos, articles and feeds will follow the same trajectory as e-mail and no longer remain device specific with users essentially creating an evolving playlist of various media on the cloud to access everywhere.

Internet of Things (IoT)

A network of hundreds of smart digital devices all communicating, monitoring activity and automating tasks to make your day-to-day simpler, faster and easier than ever. This is a growing reality — everything from traditional devices to your toothbrush, alarm clock and kitchen appliances all connected, each with its own unique address, feeding together to streamline operations. It’s slightly resonant of “Big Brother” but the potential for continual self-improvement and

efficiency is astronomical. This machine-to-machine communication has brought us technologies like Nest, which creates a two-way channel between you and your home to create more efficient, economical heating and cooling practices based on data gathered from your lifestyle and preferences.

Smart Virtual Personal Assistants (SVPAs)

Predictive intelligence technologies, such as Emu, utilize data gathered over user’s devices — from calendars, project deadlines, and emails to contact information and location — to anticipate behavior and aid, much like a live personal assistant, in the management of tasks, finances, schedules, diet and more. The possibilities here are endless and powerful, and again, demonstrate the far reaching influences of big data and mobility on improving our daily lives in very real ways. PB

Scott Kost Director, Principal Eide Bailly Technology Consulting skost@eidebailly.com Twitter: EideBaillyLLP

Flexibility, technology rank high among health care trends

BY CASEY JACKSON

If we could predict the future health care market, what would we see? What changes will be implemented as a result of the Affordable Care Act, and how will they affect health care delivery and design, and the day-today lives of North Dakota residents?

Fully anticipating the future needs of the health care industry is impossible, but Mortenson Construction, which is ranked fifth in the nation for health care construction, has some special insight after conducting a national survey of health care administrators and consultants. In late 2013, Mortenson surveyed health care providers, administrators, facilities leaders, and architects during the Healthcare Design Conference. Survey participants were asked about their response to the ACA, and their predictions and plans for adjusting to the new health care climate.

Among the major findings of the survey were that nine out of 10 health care providers say the ACA will be a “step forward” in addressing long-term health issues in the United States once it is fully established, and 83 percent say it is good for Americans. The providers did not make an unqualified endorsement of the ACA, however. A full 86 percent say the ACA needs major changes or revisions.

When translating the changes in the health care marketplace into design, several prominent themes emerge, and they are already popping up across North Dakota. These include more flexible design, greater emphasis on specialty centers and technology changing the game for rural residents.

Over the course of the survey, one word continued to appear again and again: flexibility. As health care facilities search for more efficient ways to provide care, and as they reevaluate their basic practices, facilities must be able to change

without incurring the costs of major renovations. Architects surveyed had suggestions for the flexibility challenge, including standardization of design elements across service lines and adaptation of universal exam rooms.

This basic flexibility principle is one of the guiding forces behind the Sanford Fargo Medical Center as well as the Southwest Healthcare Services Replacement Critical Access Hospital in Bowman, N.D.

For example, at Sanford Fargo Medical Center, the project team (which included the owner, design team and construction manager) evaluated and implemented the use of pre-fabricated patient bathroom units, which are being manufactured in West Chester, Ohio. This is not only helping to standardize design and construction, but it also eases the shortage of skilled labor that exists in North Dakota. Rather than finding craftworkers in North Dakota, units are being manufactured in Ohio and then shipped to the site for easy installation.

Another example of flexible design emerged on the Southwest Healthcare Services Replacement Critical Access Hospital. The owner and design team were able to create flexibility in the use of their patient rooms by designing “swing beds.” This design concept allows Southwest Healthcare Services to use the patient rooms for acute care and/or long-term care depending on the census of each respective patient population.

The emotional aspect of health care was addressed in the survey, as well, and the elements predicted by health care architects are beginning to take hold in North Dakota. Many facilities have begun to recognize the importance of natural lighting, accessible landscaping and more engaging art. The emotive aspect of the patient

Casey Jackson

experience is a balancing act between sterility and warmth, and providers are taking into account the patient experience from check-in to check-out.

Technology is changing everything and health care is no exception. While the largest medical centers, such as Sanford, are adapting technology to streamline the patient experience and improve flexibility, it is the most rural areas of North Dakota that have seen the largest changes in health care delivery due to technology.

For many rural communities, a large hospital may be 20 or 30 minutes away, and a specialty center may be a several-hour-drive. For those who work long hours, it was once nearly impossible to find time to be seen by a specialist. Now, however, with the aid of video conferencing and sharing technology, it’s possible for a patient in New Rockford, N.D., to be seen by a specialist in Fargo with a simple button click. Doctors can remotely diagnose patients, or refer patients to a specialist out of state.

As the world of health care continues to change, North Dakota remains a leader in the evolutionary shift. With greater flexibility anticipating the health care needs of the future, and greater technology connecting all patients in need to doctors and specialists who can help them, the future of health care may not be crystal clear, but it is in sight. PB

Casey Jackson Senior Design Phase Manager Mortenson Construction Casey.jackson@mortenson.com

Entrepreneurship not new to North Dakota

BY SABRINA ZIMARA

The local and even national media has been heavily covering the startup and entrepreneurial spirit of North Dakota. From the recent articles and surge of new entrepreneurial groups, it would seem this concept was a new idea to the state, when that couldn’t be further from the truth. For as long as people have lived in North Dakota, there have been businesses built from the ground up. From farmers to software developers to real estate moguls, the people on the Plains have always thrived on a way of life that allows self-sufficiency and growth.

As long as farmers have been working the land, they’ve been figuring out better ways to track their finances, inventory, assets and overall profits. With the help of Great Plains Software, that became a lot easier. In the early ‘90s entrepreneur and North Dakota native Doug Burgum became the leader of a very small startup company called Great Plains Software Inc. This small venture blossomed into a billion-dollar company, providing software that gave small- to medium-sized businesses a leg-up on their competition through advanced accounting and business management functions. Great Plains paved the way for startup technology companies to flourish in North Dakota.

In 1989, Carol Rogne, a certified public accountant, started DFC Consultants in Dickinson and focused solely on assisting local companies and tribes with accounting services. She quickly realized her clients and other businesses in the area could greatly benefit from the right software. When she was introduced to Great Plains, Rogne realized the value of the complete Enterprise Resource Planning system that allowed companies to easily manage their own finances and report on their information. DFC transformed from an accounting business into a tech

and software company, offering sales, support and training for Great Plains.

In early 2001, software giant Microsoft bought and rebranded the program to Microsoft Dynamics GP. While the system was still provided by resellers like DFC, it opened the door for Independent Software Vendors (ISVs) to develop programs that would add to the functionality of GP.

Rogne saw this as an opportunity to help Native American Housing Authorities who were struggling to track their tenants and units. DFC software programmers developed DFC Property Management, a program designed to fit the needs of Housing Authorities and property managers. The system is utilized by housing companies throughout the entire United States to track tenants, waiting lists, move in and move out dates, maintenance history, work orders and warehouse inventory. It also offers a mobile solution.

Twenty-five years ago, Rogne never imagined her accounting business would transform into a team including software experts and programmers working from four offices in North Dakota and Michigan. What she did realize was her success would depend on her willingness to take risks and her ability to change along with the business climate.

Thanks to entrepreneurs from Great Plains Software, DFC Consultants, countless startups and generations of farmers, North Dakotans continue to have the ability to start their own ventures, building on the hard work and excellence of those who came before them.

Sabrina Zimara Marketing Coordinator DFC Consultants

Sabrina Zimara

Corval Group wins API achievement award

The Williston Basin chapter of the American Petroleum Institute awarded St. Paul, Minn.-based industrial contractor and engineering firm Corval Group with its 2014 Outstanding Achievement award during a banquet held Nov. 20 in Williston, N.D. The award highlights achievements of individuals or organizations for their outstanding work, innovative solutions and community involvement, according to the group. In 2014, Corval Group achieved more than 1 million work hours without a recordable Occupational Safey and Health Administration injury, placing it among the safest contractors in the country, the company said.

NDSCS, SDSMT named STEM jobs-approved colleges

North Dakota State College of Science and the South Dakota School of Mines and Technology have been named to the 2015 STEM (science, technology, engineering and math) Jobs Approved Colleges list by Victory Media. The list is the first of its kind to rate universities, colleges, community colleges and trade schools on their responsiveness and relevance to high-demand, high-growth STEM jobs. The assessment revolved around three key indicators of suc-

cess: program alignment to job demand, job placement after graduation and diversity in the school’s STEM programs. More than 1,600 colleges participated in the process; approximately 125 colleges were ultimately named to the list.

Alerus Financial to acquire retirement firm

Grand Forks, N.D.-based Alerus Financial has acquired Bloomington, Minn.-based Interactive Retirement Systems, which provides recordkeeping, consulting and administration for 160 retirement plans, 16,200 plan participants and $1.25 billion in plan assets. The acquisition increases Alerus Retirement Solutions’ retirement plan assets under administration to $17.4 billion, serving approximately 278,000 plan participants in 49 states.

Gray Plant Mooty opens Fargo office

Minneapolis-based law firm Gray Plant Mooty said it is opening a Fargo office in order to extend its ongoing momentum in North Dakota. In a news release, the firm noted it has signed a one-year lease on its Fargo space in order to provide flexibility to quickly move into a larger space as needed.

“Fargo is a growing an important business hub and the new office will give our clients in

Sanford expands AirMed fleet to Dickinson

Sanford Health recently added a King Air B200 fixed-wing airplane and accompanying flight team to its AirMed fleet in Dickinson, N.D. The aircraft features an average speed of 300 miles per hour and short runway capabilities. Mike Christianson, executive director of Sanford AirMed, said the plane will be staffed with flight and clinical teams who will be ready to lift off in less than 20 minutes after being activated by hospitals or first responders.

North Dakota even better access to our services,” said Charlie Maier, one of the firm’s co-managing officers.

Gray Plant Mooty employs 170 lawyers in 11 practice groups. In addition to its newest location in Fargo, the firm has offices in Minneapolis, St. Cloud, Minn., and Washington, D.C.

Public-private partnerships fund 4 SD rail projects

South Dakota Gov. Dennis Daugaard announced recently that a total of $56 million in public and private funds will be invested in four rail projects across the state.

For the largest project, TIGER funds, state and federal grants, the Dakota Southern Railroad and private group Rails to the Future will provide nearly $30 million needed to reconstruct the Mitchell to Rapid City Rail Line.

An $11.5 million upgrade of the Britton Line in northeast South Dakota is being funded by the Dakota Missouri Valley & Western along with state loans and grants.

Other projects include railroad siding construction along a rail line at Huron and Aurora and an upgrade to the Sioux Valley Line in southeast South Dakota. Those projects are also being funded through partnerships between railroads and the state.

Sanford Health has expanded its Dickinson, N.D., AirMed fleet to include a King Air B200 fixed-wing airplane. PHOTO: SANFORD HEALTH

Integreon expands in Fargo

Integreon, a provider of outsourced, legal, document, business and research support, recently celebrated the opening of a larger delivery center in Fargo to accommodate its expanding operations. The 34,000-squarefoot facility allows the firm to consolidate two previous Fargo locations, providing space for 350 employees to provide round-the-clock outsourcing services for the firm’s network of global delivery centers, including in New York, Boston and Washington, D.C. The firm expects to continue a recent growth trend in the coming year and could add as many as 100 employees in 2015.

Integreon leaders and state officials cut the ribbon at a grand opening celebration for the company’s expanded Fargo facility on Dec. 10, 2014. From left, N.D. Lt. Gov. Drew Wrigley; Penny Retzer, Integreon Associates global head, client and associate engagement and U.S. country head; Mike Zuercher, Integreon chief legal officer; Al McNee, Integreon global head, document services; Bob Gogel, Integreon CEO; Troy Moore, Integreon head of documents services delivery in Fargo; Julie Laufenberg, Integreon U.S. head of talent management and general manager of Fargo; and Kalie Olson, Integreon director of finance and sales operations, document services.

INTEGREON

PHOTO:

FCCU gives to communities in honor of 75th anniversary

To commemorate First Community Credit Union’s 75th year of business, employees and board members carried out 75 random acts of kindness in 2014. The 75 acts were broken down by branch or department and ranged from donating blood to volunteerism at animal shelters and senior living centers and organizing donation drives for families in need.

FCCU was formed in 1939 with just 45 members. The financial cooperative currently has 32,000 members in 12 communities, making it the largest credit union in North Dakota. It employs nearly 150 people throughout the state.

NISC gives servers to BSC

Mandan, N.D.-based National Information Solutions Cooperative recently donated 20 blade computer servers, valued at about $5,000, to the computer support specialist program at Bismarck State College. The equipment will allow students access to updated technology for lab experiences, according to the college.

A blade server is a stripped down server computer with a modular design optimized to minimize space and power consumption, according to BSC.

Frontier Precision expands to Alaska

Frontier Precision, a Bismarck, N.D.-based provider of equipment for survey, mapping, fleet management, GIS and engineering operations, announced it has acquired the geospatial assets and business of Accupoint Inc. in Anchorage, Alaska. In addition to its headquarters in Bismarck and new Alaska office, the company also has locations in Denver, St. Cloud, Minn., Bozeman, Mont., and Cheyenne, Wyo.

Midcontinent to extend western ND fiber network

Midcontinent Communications recently announced plans to invest $5 million to extend its northern plains fiber network from Williston, N.D., to Bismarck, N.D. The added 100 miles of fiber will provide network redundancy in an area

where construction and digging have periodically resulted in service outages to residents and businesses, the company said.

Construction of the extension is expected to begin early this year and will be complete by mid-summer.

U of M Crookston adds international business major

The University of Minnesota Crookston will begin offering a major in international business and a major in English beginning in the spring semester. The degree offerings were approved in late 2014 by the University of Minnesota Board of Regents.

According to the university, the international business major will help meet the need for graduates who understand and have experience in global business. The curriculum will include classes on international business culture and etiquette, international business law, international financial management, international marketing, international business management and a senior seminar in international business strategy along with field experience in international business and/or studying abroad.

Sanford, NDSU form health research partnership

Sanford Health and North Dakota State University will conduct collaborative research on human nutrition, weight management and other

dietary-related areas as part of a seed-grant initiative developed between the two organizations. The research will address key objectives of the Profile by Sanford program, a weight-management program developed by Sanford that utilizes customized meal plans, health coaches and realtime technology. Sanford is providing $250,000 annually for five years for the program. Seedgrant proposals are due March 16; recipients will be announced in June. For more information, visit http://www.ndsu.edu/research/research_ development/Sanford_RFA.html.

Screen printers receive National Guard award

Boneskot Design Co., a Fargo screen printing company, recently received the Outstanding Center of Influence Award from the Army National Guard during a ceremony held in Bismarck, N.D. The award is given in recognition of a company’s extraordinary support to Army National Guard and Reserve soldiers during deployment. The company and its owners, Scott Syverson and Beau Fraase, were nominated for the award by 1st Lt. Christian Thorson of the C Company, 2nd Battalion, 285th Aviation Regiment, who ordered hats and shirts from the company for fellow soldiers while on a one-year deployment to Kosovo. The company’s owners paid hundreds of dollars in shipping costs to deliver the items to Kosovo as a token of gratitude for the soldiers’ service.

Employees and board members at First Community Credit Union carried out 75 random acts of kindness in 2014 to honor the organization’s 75th year of business. PHOTO: FIRST COMMUNITY CREDIT UNION

ND taxable sales continue to grow

North Dakota’s taxable sales and purchases for the third quarter of 2014 totaled more than $7.6 billion, up more than $700 million from the same three months in 2013, according to North Dakota State Tax Commissioner Ryan Rauschenberger. Twelve of the 15 major sectors showed increases in taxable sales and purchases for the quarter compared to the same three months a year prior.

Not surprisingly, the mining and oil extraction sector showed the most growth, increasing by nearly 20 percent in 3Q 2014 compared to 3Q 2013. Watford City experienced the highest percentage increase in taxable sales and purchases of all of the state’s 50 largest communities, increasing by more than 41 percent compared to the previous year. The counties with the highest percentage increases in taxable sales compared to 3Q 2013 are all located in the Bakken region and include Dunn, Billings, Sioux, McKenzie and Golden Valley counties.

GENIUS GENUS

A new species of academic facilities has changed the face of education in Alexandria, Minnesota. The Alexandria Area High School, designed by JLG Architects and Cuningham Group (AOR), provides a cutting-edge, flexible, and collaborative learning environment to adapt as education paradigms in the future. The High School takes some of the most inefficient and high maintenance space off the district’s books and alleviates crowding in the classrooms while adding a small and large group learning spaces, science, technology and engineering labs, a 1,000-seat performing arts center, athletic facilities and fields, and art rooms.

jlgarchitects.com

Office of the North Dakota State Tax Commissioner

Solberg named Bell Bank CEO

Bell State Bank & Trust’s board of directors has named Michael Solberg president and CEO. In the CEO role, he succeeds his father, Richard, who has served as the bank’s chairman and CEO for the past 32 years. Richard will continue to serve as the bank’s board chairman.

Michael began his financial career at State Bank of Fargo in 1998. In 2007, he initiated the bank’s Pay It Forward program, which encourages employees and community members to give money to individuals and organizations in need. He has served as president of the bank since 2008 and helped lead the company’s continued growth through the acquisition of Minneapolis-based Bell Mortgage. He also led the bank through its rebranding as Bell State Bank & Trust, the development of the bank’s footprint in the Twin Cities metro area and the expansion of its wealth management division.

Gunsch earns water award

Michael Gunsch received the 2014 Water Wheel award from the North Dakota Water Users Association during the group’s joint water convention and irrigation workshop held Dec. 3-5 in Bismarck, N.D. The award is given in recognition for a commitment to protect, develop and manage North Dakota’s water resources. Gunsch is a civil engineer and principal at Houston Engineering in Bismarck.

Glennon joins AE2S

Mark Glennon has joined AE2S (Advanced Engineering and Environmental Services Inc.) as a project engineer in the firm’s Fargo office. He will work in the civil engineering practice and will be responsible for the design of land development sites, including roadways, grading and drainage projects and utility infrastructure. He has more than 10 years of civil engineering experience. Prior to joining AE2S, he worked as a senior engineer at SRF Consulting Group in Minneapolis.

VanHofwegen elected to NMTC Coalition board

Lin VanHofwegen, managing director of Dakotas America, has been elected to the board of directors of the New Markets Tax Credit Coalition. The NMTC Coalition is a national membership organization of Community Development Entities and investors organized to conduct research on and advocacy for the New Markets Tax Credit.

VanHofwegen manages the operations of Dakotas America and has led the CDE to full utilization of its total NMTC allocations, overseeing a portfolio of more than $190 million in qualified low income community investments. She has experience as a small business owner in a rural community and is a certified economic development finance professional. Prior to joining Dakotas America, she served as vice president of operations at Dakota Resources.

Blueprint IT Solutions adds staff

Fargo-based Blueprint IT Solutions Inc. recently added three staff members to its team.

Ben Ziegler will serve as vice president of national sales for ACT Wi-Fi, a subsidiary of Blueprint. He has more than 20 years of experience in business and communications.

Andrea Campbell-Launert has been hired as a technology consultant and will focus on providing Xerox solutions to clients. She has approximately five years of experience in business and technology sales.

Tiffany Bolgrean has also been hired as a technology consultant. She has more than 15 years of related sales experience.

Michael Solberg

Michael Gunsch

Mark Glennon

Lin VanHofwegen

Andrea Campbell-Launert Ben Ziegler Tiffany Bolgrean

Boyum-Breen to succeed Waite as Rasmussen College president

Trenda Boyum-Breen has been selected to serve as president of Rasmussen College. She will replace Kristi Waite, who has served as president of the college for the past 17 years. Waite will retire on March 30, after which she will assume the role of vice chairperson of the college’s board of directors.

Boyum-Breen joined Rasmussen College in 2012 as chief academic officer. Prior to that, she served as vice president at Metropolitan State University. She has more than 15 years of higher education leadership experience.

Noridian Healthcare Solutions promotes 2

Noridian Healthcare Solutions has promoted Pam Gordon to vice president of the Provider Call Center and Becky Gunderson to director of Parts A and B Medical Review for Jurisdiction E and F.

Gordon is responsible for all areas of provider customer service for Jurisdictions F and E contracts including Part A and B inquiries, provider enrollment, phone and written reopening and user security. She has worked at Noridian since 1989.

Gunderson is responsible for the leadership of the Part A and B Medical Review teams, Part A Comprehensive Error Rate Testing and the Asbestosis pilot program. She has been with Noridian since 1990.

Pam Gordon Trenda Boyum-Breen Kristi Waite

Becky Gunderson

Scott Meyer

Meyer receives Brookings’ inaugural generational leadership award

Scott Meyer, Brookings, S.D., native and cofounder of Brookings-based 9 Clouds and Lemonly, recently received the first Mayor’s Generational Leadership award from Brookings Mayor Tim Reed. The award was created to recognize a community member 35 years old or younger who has affected the community by positively changing residents’ perceptions of the community, helping to attract and retain young professionals, motivating others to be active in their community and by contributing to the advancement and well-being of the community through service in a variety of areas, including economic development and volunteerism.

Meyer launched digital marketing firm 9 Clouds with his brother, John, about six years ago followed by Lemonly, which specializes in the creation of infographics, about three years ago. The two companies now employ more than 20 people and have combined annual revenues over $2.75 million. Meyer is a past recipient of the South Dakota Spirit of Entrepreneurship and South Dakota’s Young Entrepreneur of the Year award. He was also named one of 2014’s top 40 business professionals under the age of 40 by Prairie Business magazine.

Go paperless.

NDSU IT division promotes 2

North Dakota State University’s information technology (IT) division has promoted two staff members.

Jason Eide has been named manager of enterprise systems in the division’s Enterprise Computing and Infrastructure department. He joined the department in March 2013 as a system administrator. He has more than 20 years of IT experience.

Trevor McNeil has been promoted to classroom technologies specialists in the division’s IT Services department. He joined the department in February 2014 as an audiovisual technician. Prior to joining NDSU, he worked for MultiBand Corp. in Fargo.

USD business school names MPA, MBA program coordinators

The University of South Dakota Beacom School of Business has selected Kathryn Birkeland as faculty coordinator for the school’s master of professional accountancy (MPA) program. Mandie Weinandt will serve as faculty coordinator for the school’s master of business administration (MBA) program.

Both Birkeland and Weinandt joined USD in fall 2011. Their new roles involve responsibilities with the on-campus and online programs, focusing on the operation and growth of the programs, curricular innovation and student success. They will collaborate with faculty, business leaders and alumni to ensure the success of the programs in the rapidly changing environment of business, according to the school.

Kathryn Birkeland

Jason Eide

Trevor McNeil

Mandie Weinandt

Jasper Schneider, left, acting administrator of the USDA rural utilities service, is joined by Dakota Carrier Network CEO Seth Arndorfer and David Cruthers, executive vice president and general manager of the North Dakota Association of Telecommunications Cooperatives, to release the North Dakota Broadband Report on Dec. 29 in Fargo. PHOTO: PRAIRIE BUSINESS MAGAZINE

Connecting the dots

Report finds North Dakota has most fiber-to-the-home of any state

BY KRIS BEVILL

The race to connect homes and businesses with high-speed Internet access is ramping up, and North Dakota says it has taken an early lead. A report released Dec. 29 claims North Dakota has more miles of fiber-to-the-home than any other state, providing gigabit-speed Internet access to 50 percent of the state through 40,000 miles of fiber optic cables. The process has taken years to complete, and it’s not over. The state’s telecommunications leaders say their goal is to have 100 percent of the state covered by 2019.

“This is an industry where if you’re not constantly investing, you’re falling behind,” said Jasper Schneider, acting administrator for the USDA rural utilities service, during a news conference to announce the report’s findings. Schneider admitted the four-year timeline to complete 1G access to the entire state is aggressive, but said he believes it is realistic, adding that Internet access is now a necessary part of life. “Broadband touches every part of our lives,” he said.

Schneider noted that the Internet is changing the way people do business and said that Internet connectivity also needs to be high-speed in order to meet growing data demands and provide businesses with the competitive edge they seek.

Seth Arndorfer, CEO of the Dakota Carrier Network, said the North Dakota Broadband Report highlights the commitment of the state’s service providers to installing high-speed Internet access. DCN and its 15 independent rural telephone companies invested $1.3 billion to install the 40,000 miles of fiber throughout the state and will continue to invest in expanding that network, he said.

David Cruthers, executive vice president and general manager of the North Dakota Association of Telecommunications Cooperatives, said the report served as both a celebration of what has been accomplished as well as the launch of the expansion to the remaining 50 percent of the state. “It’s really been a group effort,” he said, adding that the expansive coverage area would not be possible to achieve otherwise.

Challenges Remain

Schneider said the report, which emphasized the work of rural telecommunications service providers, complements the work of the Dakota Fiber Initiative — which was formed in response to entrepreneur and investor Doug Burgum’s 2013 challenge for North Dakota to become the most connected state in the nation. While the goal may have so far been

On average in the United States, only 5 percent of households have fiber Internet, but an estimated 50 percent of homes in North Dakota have access to fiber, according to a report recently released by USDA Rural Development, the North Dakota Association of Telecommunications Cooperatives and Dakota Carrier Network.

met, there is much work left to do, particularly in the state’s urban areas, where funding assistance is not as readily available and infrastructure challenges are more complex.

Schneider said he is aware that some of the state’s most populated areas currently have the slowest Internet connection speeds, but he believes that issue will be resolved over time as providers, such as Midcontinent Communications, commit to investments in those areas. In November, Midcontinent drew support from Burgum as well as Sen. John Hoeven and Fargo-area leaders when it announced plans to provide gigabit access to its entire service area, including Fargo and other areas of North Dakota, by the end of 2017.

If North Dakota is to meet its goal of 100 percent connectivity by 2019, it will require continued collaboration among telecom-

munications companies and state and federal agencies, industry leaders said. The financial cost of installing fiber optic cables is significant and could be aided through federal and state support, they said. Schneider said the USDA has already invested more than $330 million in telecommunications and broadband projects in North Dakota, and the agency expects to continue to fill out the state’s connectivity map. On a state level, financial incentives for providers such as sales tax exemptions for infrastructure could be helpful, but Schneider said industry representatives will focus first primarily on educating legislators about broadband infrastructure and its impact on the state’s economy. PB

Kris Bevill Editor, Prairie Business 701-306-8561, kbevill@prairiebizmag.com

*Fiber To The Home deployed by end of year 2015. Map data based on area served.

Go-To Guy

Grand Forks Region EDC leader Klaus Thiessen goes above and beyond to help new and existing businesses succeed

BY KRIS BEVILL

After more than a decade in his role as president and CEO of the Grand Forks Region Economic Development Corp., Klaus Thiessen knows just about everyone in business in the region and has earned a reputation for exceeding expectations in assisting new and existing businesses.

Whenever Bill Burga has a question related to business, the first person he reaches out to is Klaus Thiessen. As president and CEO of the Grand Forks Region Economic Development Corp., Thiessen is in the business of helping business people so he is likely to say that’s simply part of a day’s work. Still, Burga, who serves as head of operations-America for LM Wind Power, says Thiessen regularly goes over and above what could be considered his call of duty.

“If I call Klaus and say, ‘Where do I go to shop for research grants?’ He knows. Virtually anything that has to do with our business, he is my go-to guy,” Burga says. “There’s virtually nothing that he would say ‘that’s not our job’ or ‘I can’t help you there.’”

Northern Neighbor

Thiessen’s humble, in-it-together attitude blends well with upper Midwestern culture, though he is actually a native of Canada. He got his start in economic development in 1980 when he joined the Winnipeg (Manitoba) Business Development Corp. as a business development officer. He worked in that role for about four years before being lured away to take a private sector job with accounting consulting firm Touche Ross

PHOTO: ERIC HYLDEN/FORUM NEWS SERVICE

Management Consultants. “I moved for the wrong reasons: a nice office and more money,” he says. “But I didn’t really care for the job.”

Thiessen spent most of the next two decades moving back and forth between private and public sector positions. He helped establish Manitoba’s technology commercialization program — Manitoba Technology Accelerator — and moved to Calgary, Alberta, to work for Canon, but he never lost touch with his contacts in the Winnipeg economic development circle. When he decided to move back to Winnipeg he found a position as business development manager at the economic development corporation, which had been newly restructured and renamed Winnipeg 2000. After six months he was named interim CEO of the organization. A year later, he was offered the position full time. He served in that role until he was recruited to the CEO role at the Grand Forks Region EDC in November 2003.

Thiessen says his extensive U.S. network, built over 15 years while serving on the International Economic Development Council, made him a desirable candidate for the Grand Forks job. He continues to place high value on networking and describes his job as being “people based and communications based,” noting that the diverse people and topics he deals with on a daily basis are what he likes most about economic development. “I think you can’t find a better position in terms of where your work changes, literally, every day,” he says. “You become a real generalist — an expert at absolutely nothing, but you can dig yourself into a hole talking about anything. It’s exciting and it’s satisfying, too, when you see initiatives that are successful.”

Thiessen has seen many initiatives and projects reach successful outcomes in his 11 years in Grand Forks, resulting in more than 1,700 new jobs created by EDC clients since 2004, according to the North Dakota Department of Commerce. In November, the state commerce department recognized Thiessen’s successful efforts with the 2014 Governor’s Choice for Economic Developer of the Year.

“Klaus focuses on the fundamentals of economic development and consistently and collaboratively drives projects and initiatives,” Commerce Commissioner Al Anderson said in a statement announcing the award. “Since he joined the EDC he has been setting the stage for opportunities the region is realizing today. Under his leadership, the region has maintained a focus on new wealth creation that results from primary sector growth.”

Long-Term View

Paul Lucy, director of economic development and finance for the commerce department, has been working with Thiessen since he joined the EDC and says he has always been impressed with his ability to bring together diverse groups of people to work toward a common goal. “He does that in a way that allows everyone to have a voice and play a contributing role,” Lucy says. “Klaus [also] has a quality that all the best economic development professionals possess — the ability to stay focused on dealing with opportunities and challenges in front of him today, while being able to successfully position his community and region to identify and pursue strategies that will create opportunities for long-term sustainable economic growth. That is not easy to do and I believe Klaus is one of the best at this.”

Thiessen is currently involved in several large, long-term projects with the potential to impact the entire region. He serves as the Grand

Forks point of contact for the Valley Prosperity Partnership, which is a five-year initiative focused on economic development at a regional scale. Thiessen sits on the group’s steering committee along with representatives from business, higher education, health care and economic development groups throughout the Red River Valley and says he looks forward to the VPP coming to the forefront during North Dakota’s legislative session. He firmly believes the VPP’s work has potential to have a successful long-term impact on the region.

Also looming large on the radar for both the near- and longterm is the build-out of the region’s unmanned aircraft systems (UAS) industry, with emphasis on Grand Sky, a UAS business development park located west of Grand Forks and adjacent to the Grand Forks Air Force Base. “The whole UAS industry opportunity is something we’re really going to focus on for 2015,” Thiessen says.

Lucy says the commerce department has worked closely with the EDC to position North Dakota and Grand Forks as a “hotbed” for UAS development, and Thiessen has been at the center of the effort. “He was particularly involved as it relates to making sure a long-term strategy and necessary infrastructure are in place to take North Dakota from being a supporter of developing the UAS industry to someday being the epicenter of the UAS industry activity in the U.S.,” he says.

In some cases, having a long-term view toward economic development also means sticking by clients during hard times, and Thiessen and the EDC have proven their commitment to clients in difficult situations on several occasions over the past decade. When LM Wind Power was forced to lay off workers during an industry downturn a few years ago, the EDC put the company in touch with local Job Service leaders to organize job fairs for affected employees and Thiessen spoke out in support of the company, expressing confidence that the location would bounce back. A year later, the company did just that, announcing it would hire nearly as many positions as had been cut, thanks in part to a federal tax credit netted with help from the EDC.

Thiessen also takes satisfaction in the work the EDC has done with Cirrus Aircraft, which endured a difficult period several years ago, but has since recovered and expanded its operations. “They’ve turned the corner … and it’s one of those industries — a technology-related industry with a high profile — and we’re really proud and gratified to see that moving forward,” he says.

A steadfast commitment to building long-term relationships and diverse, impactful industries in the region is a calling card of Thiessen’s, but he wastes no time in pointing out that successful economic development is a team effort, within the EDC and throughout the community. “I’ve got a great team and volunteers so it’s not about one individual — ever,” he says. Among the community groups Thiessen counts in the EDC’s corner is the University of North Dakota as well as the local Chamber of Commerce, which is a bit unique when considering EDCs and chamber groups are often competitors. Given Thiessen’s team-player philosophy, however, it is not all that surprising.

“One of the most important things in economic development, no matter where you are, is to avoid turf warfare,” he says. “Because at the end of the day, if the ultimate goal is a good one, whomever takes the credit is fine as long as we can support one another.” PB

Kris Bevill Editor, Prairie Business 701-306-8561, kbevill@prairiebizmag.com

Lessening the Student Loan Load

Bank of North Dakota offers unique consolidation program for residents

BY KRIS BEVILL

On April 26, 2013, North Dakota Gov. Jack Dalrymple signed into a law a bill requiring the Bank of North Dakota to administer a student loan consolidation program. Originally proposed as a program to offer consolidation services to physicians working in rural areas of the state, the bank’s final marching orders were to create a program aimed at any North Dakota citizen wishing to consolidate their student loans. After a year of development, BND rolled out the DEAL One program last April. By the end of November, the bank had dispersed $126 million in loans to about 2,800 borrowers and had another 300 loans, representing about $13 million, pending, according to Eric Hardmeyer, BND’s president and CEO.

“We [were] almost at $140 million in eight months, so we think that by any kind of measuring stick we’ve been very successful with this program,” he says.

Unique Features

Consolidation loans are certainly not a new concept, but Hardmeyer

The Bank of North Dakota’s DEAL One program offers North Dakota residents a unique student loan consolidation option.

PHOTO: BANK OF NORTH DAKOTA

believes BND’s DEAL One program is a first of its kind, primarily because it allows borrowers to consolidate all of their student loans — federal, state and alternative — into one loan. “We think that we’re the first in the nation to do this,” he says. “For years, there’s been a very competitive market for refinancing mortgages, but never really anything has existed for individuals consolidating all of their student loan debt.”

The program also boasts no fees for participants and offers competitive variable or fixed interest rates. The variable rate through March is 1.74 percent while the fixed rate is 4.83 percent. Hardmeyer says he is not aware of any other variable interest rate as low, and notes that to protect variable rate-takers from large increases the program caps rate increases at 1 percent annually. “We think that’s a huge benefit,” he says.

Payment Progress

Lisa Mosser, president at Cando, N.D.’s American Bank Center location, says she learned of the DEAL One program while attending an Independent Community Banks of North Dakota Emerging Leaders program event and immediately thought it

could be useful for her husband. She had financed, and already repaid, her education loans through BND, but his loans had been financed by a different provider, and after a decade of repayments he still owed about $18,000 on an initial loan of $23,000. “I felt like we were just paying and paying on it and the balance wasn’t going down,” she says.

Consolidation through the DEAL One program lowered her husband’s monthly payment by about $70, and Mosser says the couple noticed immediate progress in reducing the principal owed on the loan. She was so pleased with the results and the entire process that she invited all of her immediate family to utilize the program and says she would recommend it to others as well.

Jennifer Kuschel, a pharmacist at Medical Pharmacy in Fargo, says she submitted her loan application the same day she learned the program had been announced.

“I had been waiting for any way to get my student loans out of Sallie Mae,” she says.

Before consolidating, Kuschel’s monthly student loan payments had been “the size of a small mortgage.” Through BND, she was able to reduce her interest rate payment by more than $300 per month. “I’m going to pay this off years faster than I was going to,” she says, adding that she has been very satisfied with both the interest rate and the level of service from the bank. “I’ve been telling everybody I know to get their loans consolidated.”

Hardmeyer says the average loan amount for program participants has so far been about $45,000, but loans have ranged from as little as $5,000 to more than $100,000. Medical professionals, who typically have large amounts of student loan debt to deal with, are ideal candidates for consolidation, but he says he encourages anyone with a good credit score and the ability to repay the loan to consider the program. He notes that it is not uncommon for people to put off major life changes such as buying a home or starting a family because they are strapped with hefty student loan payments and says he has witnessed the program aid in alleviating that burden. In one example, he says a college graduate was living with her parents because her monthly $500 student loan payment was eating away at her disposable income. Through the DEAL One program, she was able to lower the interest on the loan and stretch payments out over about 20 years, effectively cutting her monthly payment in half.

“You’re talking about a monthly savings of around $300 and that’s fairly typical of what we see,” Hardmeyer says. “This program in some cases has really helped with those kinds of personal financial choices.”

Recruitment Tool

There are a few restrictions to the program and Hardmeyer admits it’s not for everyone. To qualify, participants must be residents of the state for at least six months and must meet BND’s credit criteria. Also, while the DEAL One program allows for some hardship requests and provides security such as death forgiveness,

Eric Hardmeyer, president/CEO, Bank of North Dakota

it does not offer the same type of income-based repayment plans and loan forgiveness features that federal student loans provide. However, considering the positive response received so far and the never-ending pipeline of potential new customers, BND intends for the program to be permanent and will allocate $150 million each year for at least the next several years to fund the program. “We’re going to continue to see people graduate, live in the state and will want to consider this program, so we see [it] as an ongoing program that will last for years,” Hardmeyer says.

And while it may not have been a specific goal initially, because the program is geared exclusively toward North Dakota

Pipeline of potential customers

A report released in November from the Project on Student Debt at The Institute for College Access & Success found that in 2013 nearly 70 percent of graduating seniors at public and private nonprofit colleges had student loans. The national average debt for these graduates was $28,400, a two percent increase from the year prior.

The report also compiled state averages for student debt at graduation. North Dakota was the only state which did not receive a ranking, however. According to the report’s authors, the institute compiled its data based on voluntary information submitted by higher education institutions and did not calculate state averages if the data submitted covered less than 30 percent of bachelor’s degree recipients or if the underlying data for the state showed a one-third or more change in average debt from the previous year. The usable data submitted by North Dakota institutions totaled only 25 percent of bachelor’s degree graduates, according to the report.

South Dakota’s average student loan debt was found to be $25,750 per graduate in 2013 and 72 percent of graduates had debt, ranking it second in the nation among the percentage of 2013 graduates with student loan debt. Minnesota reported an average student loan debt of $30,894 and 70 percent of graduates in 2013 had debt, ranking it fourth in the nation for the percentage of 2013 graduates with student loan debt.

The entire report is available at www.projectonstudentdebt.org.

residents, DEAL One could also play a role in the state’s efforts to recruit and retain workers. Hardmeyer says he has recently spent time working with economic development groups to promote the program as part of their workforce attraction strategies. “We’ve spent a lot of time talking about that recently,” Hardmeyer says. “I think it can be a useful tool in the recruitment efforts.”

For more information on the program, visit dealstudentloan. nd.gov PB

Kris Bevill Editor, Prairie Business 701-306-8561, kbevill@prairiebizmag.com

Nearly three-quarters of college graduates are entering the workforce with student loan debt, according to research conducted by The Institute for College Access & Success. PHOTO: BANK OF NORTH DAKOTA

Rapid City

Taking Aim at Workforce Shortage

South Dakota, Denny Sanford team up to provide free college for skilled workers

BY ROB SWENSON

Greg Von Wald, president of Mitchell Technical Institute, was among the South Dakotans pleasantly surprised when Gov. Dennis Daugaard and the state’s leading philanthropist, T. Denny Sanford, unveiled a new scholarship program.

The $50 million Build Dakota scholarship program announced in December is designed to combat the state’s chronic shortage of skilled workers. The program will provide full-ride scholarships to students who pursue technical degrees at MTI in Mitchell and at three other technical schools in South Dakota.

Sanford and the state are contributing $25 million to a special fund that will pay for approximately 300 full-ride scholarships each of the program’s first five years. After that, an endowment fund will support about 50 scholarships a year.

“It was kind of a stunning announcement for us as well as the general public. It’s good

news,” Von Wald says. “It’s a good start, without a doubt.”

Von Wald oversees a technical school that had an enrollment last spring of 1,259 students. The other three schools that will benefit from the scholarship program are Western Dakota Technical Institute in Rapid City, Lake Area Technical Institute in Watertown and Southeast Technical Institute in Sioux Falls. The schools offer a variety of one- and twoyear degrees in technical fields.

“The real boldness in this is the insight, that of Denny Sanford,” Von Wald says. “It is a bold move. There will be more ideas that come out of this.”

Sanford Steps Up

Sanford is a wealthy U.S. businessman and well-known philanthropist. He owns First PREMIER Bank and PREMIER Bankcard, which are based in Sioux Falls and do business nationally. Since buying the parent company

Sioux

of the financial service businesses in 1986, Sanford has donated more than $1 billion to charitable organizations and causes across the United States. Among the biggest recipients has been Sanford Health, a regional health care system based in Sioux Falls and Fargo. The health care system carries Sanford’s name.

“He wants to die broke, and we’re all trying to help him,” Dana Dykhouse says, jokingly. As the CEO of First PREMIER Bank, Dykhouse is close to Sanford.

Dykhouse is also a prominent civic leader, especially on economic development matters. He had heard repeatedly from other business leaders in South Dakota that a shortage of skilled workers was the biggest obstacle holding back business growth the state. After a fall meeting in Sioux Falls at which workforce issues were discussed, Dykhouse approached Daugaard. They discussed the possibility of the state supporting a possible donation from Sanford to address workforce issues.

Dykhouse also suggested to Sanford that workforce development would be a good target for a transformational gift. “They both said yes so fast that we have work to do yet,” Dykhouse says.

Daugaard says officials signed off on final terms of the agreement on Dec. 17, the same day that the initiative was announced.

Daugaard praises Sanford for again stepping up to help make South Dakota a better place. In addition to Dykhouse, the governor credits Miles Beacom for putting the program together. Beacom is the CEO of PREMIER Bankcard and, like Dykhouse, is close to Sanford.

Daugaard says he had not previously planned to devote $25 million from a special state economic development fund for workforce scholarships. But the dollar-for-dollar match opportunity was too good to pass up. The state’s share of the money will come from a development fund controlled by the governor. The fund receives

an annual portion of unemployment insurance premiums paid by South Dakota employers. The fund was created during the administration of the late Gov. George Mickelson.

So, nothing in the Build Dakota program needs legislative consent, says Daugaard, who has appointed a seven-member board to oversee the program. Dykhouse is one of the members of the recently created Build Dakota Scholarship Board.

The other six members are:

• Wayne Baumberger, engineering manager at Caterpillar in Rapid City, and the chairman of the new board;

• Greg Carmon, owner of Midwest Railcar Repair Inc. in Brandon;

• Mark Leddy, CEO of Valley Queen Cheese Factory in Milbank;

• Terry Sabers, vice president of finance for Muth Electric in Mitchell;

• Deb Shephard, retired president of Lake Area Technical Institute in Watertown;

• Diane Vanderwoude, vice president of academic affairs at Sanford Health in Sioux Falls.

“All of these individuals know firsthand about the workforce challenges we’re experiencing in South Dakota,” Daugaard says.

Attracting Applicants

The Build Dakota Scholarship Board will be assisted by one full-time and one part-time employee. Among other duties, the new board will identify areas of study that will be eligible for scholarships. Education officials also will have to determine the current enrollment capacities at technical institutes for high-demand fields of study.

The South Dakota Department of Labor has some existing projections for high-demand, specialty-trade jobs in South Dakota. For example, the department previously estimated that the need for electricians would grow 11.2 percent from 2010 to 2020. The department projects the average annual demand for electricians to be 66.

The department also has projected that 30 mechanics, installers and repairers will be needed each year until 2020. Fifty plumbers, pipefitters and steamfitters also are expected to be needed each year.

Applications for scholarships for the school year that will begin in the fall of 2015 are expected to become available this month, according to the South Dakota Department of Education. Scholarships will cover the cost of tuition, fees and other required program expenses.

“Our hope is to accept applications and select initial scholarship recipients before the end of May, so we’re going to work pretty hard,” Daugaard says. “We know some students are making decisions already.”

The new scholarship program will be available to out-of-state as well as in-state students. Recipients must agree to work in their field of study full-time for three years in South Dakota.

S.D. Gov. Dennis Daugaard has committed $25 million in state funds to the Build Dakota scholarship program, aimed at lessening the state’s shortage of skilled workers.

Denny T. Sanford is South Dakota’s most prominent philanthropist. His most recent contribution--$25 million to fund scholarships for students pursuing technical degrees.

“It’s our hope to bring people in across the region for training or retraining,” Dykhouse says. “We’re putting almost all South Dakotans to work now. We need kids not only from other states, but I think from other countries. I think we’ll have opportunities for more immigrants.”

The scholarship program is bigger but similar to the Dakota Corps scholarship program the state created under former Gov. Mike Rounds to assist students in high-demand fields such as teaching, nursing and engineering. Build Dakota is different in that it puts more focus on workers rather than businesses, says Mary Medema, director of workforce development for the Sioux Falls Development Foundation.

“Affordability is the major reason people don’t pursue or complete training programs. This literally removes a huge barrier,” she says. “Time is the other major barrier. But affordability certainly is number one.”

Medema points out that growing cities such as Sioux Falls have not been ignoring workforce challenges. Hundreds of efforts are ongoing across the state and region, she says. Many companies offer internships and scholarships to develop their own workers, too.

Daugaard recently awarded $1 million in state matching funds to communities and organizations across the state to supplement local programs.

Regional Issue

The workforce challenge extends well beyond the borders of South Dakota. North Dakota, an economically booming state, also faces a severe shortage. So do growing cities in other parts of the Northern Plains.

Future challenges on the workforce front in South Dakota will include encouraging communities and organizations to raise additional funding to address workforce challenges, officials say. Development programs such as Forward Sioux Falls have addressed workforce development in the past with efforts to recruit workers. Forward Sioux Falls is a joint venture of Sioux Falls Area Chamber of Commerce and the Sioux Falls Development Foundation. Its focus on workforce issues is expected to expand in the future.

David Owen, president of the Pierre-based South Dakota Chamber of Commerce & Industry, says the rising sophistication of the U.S. economy has added to workforce challenges. Workers have been able to get good jobs with a high school education, he says. But when jobs are eliminated because of an economic downturn or some other factor, training or retaining becomes necessary.

Owen and other business officials acknowledge that offering 300 scholarships a year to technical workers will not solve the South Dakota’s labor shortage.

“It brings to mind the old line ‘don’t let perfect get in the way of good.’ It’s a hell of a good start,” Owen says. “This goes a long way to addressing areas of need,” he says, adding that the program will monitor where shortages are and try to move workers to fill the gaps. “Count that as a win-win.” PB

Rob Swenson Contributing writer RobSwensonMediaServices@gmail.com

S.D. Gov. Dennis Daugaard, right, shares a laugh with Sen.-elect Mike Rounds, left, T. Denny Sanford, second from left, and Dana Dykhouse during a news conference held Dec. 17, 2014, in Sioux Falls to announce the Build Dakota scholarship program.

PHOTO: MICHAEL BROWN/FORUM NEWS SERVICE

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Fargo Co-Location

Bismarck Co-Location

Massive cranes tower over the Sanford Fargo Medical Center, shown here in late November 2014. The facility, which is located just south of Interstate 94 in south Fargo, is expected to be complete in 2017.

PHOTO: JOHN BROSE/BROSE PHOTOGRAPHY

Reshaping Fargo’s skyline

Sanford Fargo Medical Center, one of the nation’s largest health care projects stays on budget, on schedule

BY KRIS BEVILL

South Fargo’s skyline has started taking on a new look as Sanford Health’s massive new medical center rises up from the prairie along Interstate 94. The steel framework of the 11-story facility outlines what will become the 384-bed, 1 million square foot Sanford Fargo Medical Center, an enormous project in size as well as in anticipated impact on the entire region. With a price tag of $494 million, the project ranks among the top 10 largest health care construction projects in the U.S. currently. It is also one of the largest private construction projects in the history of North Dakota.

Projects of this size require intensive collaboration among a long list of private contractors and public officials to pull off and this one is no exception. Designed by HKS Inc., with JLG Architects serving as associate architects, and led by Mortenson Construction and Nor-Son Inc. in the role of construction managers, at least two dozen private companies are participating in the project, along with support from city and state officials. The four-year project is about at its halfway point and remains on budget and on schedule to open in 2017. Start to finish, project leaders expect 1.4 million man hours of work will be needed to build the medical center. And work they do, rain or shine. As much as possible, that is. Don Marty, vice president of Sanford Medical Center Facility Planning, says crews had enclosed between 10 and 15 percent of the facility by the end of December and the project had yet to experience any unexpected construction issues, aside from a few weather delays. “November was much windier and colder than typical so we had a lot of lost days on the structural steel erection, however the crews worked Saturdays and Sundays when it was nice to get caught back up on schedule,” he says. Over the rest of the winter, crews will pour concrete on the upper floors of the center and will continue with the installation of interior walls on lower levels as well rough in mechanical and piping systems.

Adapting to Change

While there is a constant flurry of activity at the construction site, much of the prep work for the medical center is being carried out off site. Headwalls for rooms are being fabricated at a Fargo warehouse, structural steel gets welded at the manufacturing plant and bath pods are being prefabricat-

ed at a plant in Ohio. The ability to prefabricate these type of building components has proved invaluable as construction managers confront an ongoing skilled worker shortage in Fargo and throughout the region. “We probably would not be able to build the building — with the shortage of craft workers — if we wouldn’t have prefabricated much of the building and structure,” Marty says. “From a construction standpoint, I think that [prefabrication] is really unique.”

When patients and visitors arrive at the completed facility, Sanford officials hope that one of the first aspects of the facility they notice is everything they don’t actually see. That’s because the building is being designed to emphasize the patient experience and separate the business side of health care. “We’ve worked really hard to design an onstage/offstage concept so that the busyness of all the work that we as caregivers need to do is kept as much as possible behind the scenes so it creates an environment of healing and calmness for our patients and their visitors,” says Kate Gausman, Sanford’s medical center project director.

Gausman says the various layouts of Sanford’s current Fargo facilities taught the organization the importance of standardization, so that concept is being applied at the new med center. “The core of every wing is exactly the same … that leads to efficiency, as well as we know from our research that standardization really lends itself to patient safety,” she says.

Sanford estimates the medical center will record about 500,000 patient visits annually, an increase of about 50,000 compared to the number of annual medical visits to the organization’s current Fargo locations. The economic impacts to the Fargo metro are already evident in the commercial and residential building boom occurring in areas near the center, and it is expected that the center will serve patients from throughout the region, thus impacting residents in many communities.

“It’s not just a Sanford project,” Gausman says. “It really is a community and regional project, and we’re really excited about that.” PB

Kris Bevill Editor, Prairie Business 701-306-8561, kbevill@prairiebizmag.com

Project Players

Design:

HKS, Inc. – architect/designer

JLG Architects – associate architect

Lightowler Johnson Associates Inc. – civil engineer

Northern Technologies Inc. – soil engineer

Construction:

Mortenson Construction / Nor-Son Inc. – construction manager

Additional industry players:

Ames Construction Inc.

Atlas Foundation Co.

CCRD Partners

Dakota Fence

Hebron Brick

Heliplanners

Industrial Builders Inc.

Metropolitan Mechanical Contractors

Moorhead Electric Inc.

Multivista

N.D. Sewage Pump & Lift Station Service Co.

Rick Electric

RTKL Technology

S&S Landscaping

St. Onge Co.

Sweeney Controls

Van Deusen & Associates

Chipping in for energy education

Energy training programs get boost from federal grants, industry

BY MARNIE LAHTINEN

Today’s economy is creating new demands for technicians in the energy sector and Bismarck State College is enhancing its technical programs to meet those needs. A recent grant from the U.S. Department of Labor and a donation from energy company Hess Corp. will provide BSC financial support for these job-driven technical programs.

The college is the lead recipient of a $9.9 million federal grant for an association of North Dakota schools called the TREND (Training for Regional Energy in North Dakota) Consortium. This is the second Department of Labor grant for the consortium, which includes BSC, Williston State College, Sitting Bull College and Turtle Mountain Community College. The grant funding is designated for the development and expansion

of training programs within the energy, welding, transportation and construction sectors.

“BSC has established energy programs, so funding has been used to add lab and other equipment, provide additional training for faculty and to provide more services to students,” says Emily McKay, TREND Consortium project director.

McKay, who is based at BSC, says there are three main goals for this round of federal funding. “First, the consortium plans to increase training and credentialing efforts in the transportation, welding, construction and energy industries,” she says. “There is a specific focus on career pathways so that participants in TREND programs can get training that will lead to high-wage, high-skill jobs in a shorter amount of time (nine months – two years).” TREND par-

Bismarck State College students train using new lineworker equipment.

PHOTO: BISMARCK STATE COLLEGE

ticipants graduate with a certificate or an associate’s degree, depending on their course of study. Additionally, BSC offers a bachelor’s degree in energy management.

The second funding goal focuses on curriculum delivery. “We also plan to improve curriculum delivery by offering more flexibility to our students through technology-enabled environments, night courses and blocked scheduling,” McKay says. Blocked scheduling allows for a more concentrated experience of a study. Students may have fewer classes per day but longer periods of time in the classroom in order to complete classes in an accelerated format.

Third, the consortium plans to use the federal funding to increase retention strategies. “We want to focus on retaining students once they come to school and ensure that they stay enrolled and graduate,” McKay says. “We want to give them the skills to succeed so that when they are employed, that success continues.”

Enrollment in TREND programs is increasing in tandem with employment demands in these energy sectors. “TREND programs served slightly more than 1,000 students at BSC with the first Department of Labor grant in 2012,” McKay says. “We are anticipating more than 1,700 students for this round.”

Most students in BSC’s energy programs hail from North Dakota. But because the college has a strong online energy program, it attracts individuals from all around the country, and even the globe, according to Kari Knudson, vice president of the National Energy Center for Excellence at BSC. “Bismarck State College’s energy programs are in high demand and the jobs are plentiful for students,” she says.

Currently, there are more jobs available in the TREND targeted industries than there are students in training. Local energy employers are highly engaged with Bismarck State College and the TREND Consortium as they anticipate workforce demands, according to McKay. Six local employers signed on to support the grant request from the Department of Labor.

Hess Corp., an international company focused on oil and gas exploration and production, has operations in Minot and Tioga, N.D., and maintains close ties with BSC’s mechanical maintenance program. A recent $29,621 donation from Hess will go towards the purchase of two hydraulic system trainers for the mechanical maintenance program, according to Knudson.

“The trainers, both designed and manufactured by Amatrol, will teach students how to use equipment that they will encounter on the job using industry standard components,” she says. “The hydraulic system trains students on pumps, gauges and valves, while the pneumatic trainer teaches how those components fit into real-world applications.”

She says BSC enjoys regularly collaborates with Hess and other energy companies across the state. “Employers are engaged with curriculum development, providing internships, recommending equipment and technology, providing scholarships and job shadowing,”

“Throughout the year, students have opportunities to engage with potential employers through job fairs, mock interviews, question and answer sessions and more. Most importantly, they hire our students.” PB

Marnie Lahtinen Contributing writer MarnieLahtinen@gmail.com

Knudson says.

Hess Corp. representatives present the National Energy Center of Excellence at Bismarck State College with $29,621 to purchase equipment for its mechanical maintenance program. From left: Ron Baranko, NECE assistant professor petroleum production technology program; Kyren Miller, NECE program manager; Bruce Emmil, NECE associate vice president; Cody Dukart, Hess operations superintendent; Michael Bast, Hess operations manager for North Dakota; Joey Kitchens, Hess maintenance superintendent; Dave Clark, BSC interim president; Kari Knudson, vice president of National Energy Center of Excellence.

PHOTO: BISMARCK STATE COLLEGE

Drilling Productivity Report Year-over-year

Drilling Productivity Report Year-over-year summary

New-well gas production per rig

Monthly additions from one average rig

Monthly additions from one average rig

BakkenEagle FordHaynesvilleMarcellusNiobraraPermianUtica February-2014

February-2014

Indicated

drilling data through December projected production through February

February-2014

through December projected

February-2014

February-2014

February-2014

February-2014

through February

SOURCE: U.S. DOE ENERGY INFORMATION ADMINISTRATION

Interest Rates

Employment

Gas Captured/Sold

Data provided by David Flynn, chair of the University of North Dakota Department of Economics. Reach him at david.flynn@business.und.edu.