Prairie Business May 2014

May 2014

Bearing the Load Trucking firms develop training programs to teach new drivers, fill worker demand pg. 26

ALSO Tasty Tourism Wineries take root in the northern Plains

pg. 32

Evolving with Health Care Tech company grows with demand for cloud-based services

pg. 40

Photo courtesy of Caterpillar Inc.

North Dakota. Doing Business Better.

Caterpillar s drivetrain remanufacturing facility in North Dakota is tripling in size and adding jobs, helping to keep Cat machinery moving worldwide. Learn how the North Dakota Department of Commerce and companies in the state are doing business better at www.NDBusiness.com

|INSIDE| May 2014 VOL 15 ISSUE 5

DEPARTMENTS

FEATURES

6 Editor’s Note

BY KRIS BEVILL

Road trip 8 Business Advice

BY MATTHEW D. MOHR

Bad debt deals 8 Management Matters

BY JOHN GIRARD

Does happiness matter?

10 Finance

BY STEVE POCIASK

Eliminating credit union tax exemption bad public policy 12 Research & Technology Trainees at MBI Energy Services’ training facility near Belfield, N.D., receive specific procedure training on real job equipment to prepare them for oilfield trucking duties.

PHOTO: STEVE BORAAS

BY CONSTANCE WALTER

World-class Sanford Lab supports local education, economy 14 Economic Development

26 Bearing the Load TRANSPORTATION

BY KLAUS THIESSEN

Access to transportation networks attracts businesses

Trucking firms develop training programs to teach new drivers, fill worker demand

16 Prairie News

32 Regional Wine Industry Gets Legs TOURISM

Winery numbers grow as cold-hardy grapes, dedicated growers take root

22 Prairie People 24 Business Development Creating the China market 38 Talk of the Town Rapid City goes ‘big’

EVENTS

40 Health Care Evolving with health care

Midwest Mobile Summit ................................................................................................................May 5-6 Fargo, N.D. ............................................................................Information: midwestmobilesummit.com

46 Energy

NDSU Executive Education series – The Leadership Retreat: Forward Thinking................May 6-7 Carrington, N.D. ..........................................................Information: ndsu.edu/dce/exceed/leap/9845

48 Energy: Drilling Data

2014 Williston Basin Petroleum Conference .........................................................................May 20-22 Bismarck, N.D. ...................................................................................................Information: wbpcnd.org

50 Business to Business

Bio-Industry Summit.........................................................................................................................May 21 Fargo, N.D. .............................................Information: theresearchcorridor.com/bioindustrysummit

52 By the Numbers

South Dakota Governor's Workforce Summit .............................................................................May 21 Watertown, S.D. ........................................Information: southdakotawins.com/workforcesummits/ South Dakota Governor's Workforce Summit .............................................................................May 22 Brookings, S.D. ..........................................Information: southdakotawins.com/workforcesummits/

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As trucking firms throughout the U.S. struggle to fill open driver positions, some firms, such as Britton Transport in Grand Forks, N.D., have begun to focus on training new drivers to fill demand.

PHOTO: BRITTON TRANSPORT

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Prairie Business Magazine May 2014

Scan this with your smartphone's QR Reader to visit our website.

Next Month The June issue of Prairie Business magazine will cover the growth of building supply companies throughout the area in response to a region-wide building boom. The issue will also explore trends in landscape architecture. Additionally, the issue will profile Northland Community & Technical College's aerospace program and its role as a leader in UAS development.

|EDITOR’S NOTE|

Road trip orkforce issues once again grace the cover of our magazine. This month, we explore the trucking industry and efforts firms are making to attract and retain the drivers they need to keep all of our goods moving and Bakken oil wells pumping.

The shortage of truckers is a nationwide issue and has been for several years, but our focus this month is on North Dakota, where the problem has dramatically escalated in recent years due largely to the high demand for drivers in the oil patch. It is estimated that 2,300 truck trips are required to get every well operational, and the high salaries paid to Bakken truck drivers have lured employees from other firms and made it difficult for lower-paying employers, particularly farmers, to find the drivers they need. Add to that historically low unemployment numbers and a high percentage of retiring drivers and it’s easy to see why trucking companies are having a hard time finding employees. Firms that are creative in their approach to recruitment and retention and willing to invest in training young employees are finding the most success in keeping their trucks on the road. To find out what strategies are being used, read “Bearing the Load.”

I’m avoiding looking outside at the fresh layer of snow coating the ground as I write this column, and choose instead to focus on the months ahead, which will hopefully include a sunshinefilled getaway to enjoy the beauty of our region in the summertime. Tourism continues to play a growing role in the region’s economies and is becoming more diverse all the time. Wineries are now becoming more common throughout the Dakotas and Minnesota and are popular attractions for wine enthusiasts, of course, but also for general tourism by way of gift shops and event spaces. The budding industry is owed largely to the development of cold-hardy grape varietals, which means regional wines don’t have to be rhubarb- or chokecherry-based anymore (not that there’s anything wrong with that), and an equally hardy group of wine and grape enthusiasts who are planting their roots in a uniquely northern Plains wine industry.

In “Regional Wine Industry Gets Legs,” contributing writer Rob Swenson takes a look at how far along the industry is in Minnesota, South Dakota and North Dakota and speaks with several of the region’s trendsetters, including the so-called godfather of South Dakota’s wine industry and a Minnesota couple who just received a U.S. Small Business Administration award for their winery work. Swenson noted in his article that the success of wineries depends largely on local sales, so I plan to do my best to support this niche industry. I hope many of you find yourselves on a winery trail this summer as well. Cheers!

W

KRIS BEVILL Editor kbevill@prairiebizmag.com

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Prairie Business Magazine May 2014

KORRIE WENZEL, Publisher RONA JOHNSON, Executive Editor KRIS BEVILL, Editor BETH BOHLMAN, Circulation Manager KRIS WOLFF, Layout Design, Ad Design

Focus on your business, because CenturyLink has your data and voice solutions covered.

Sales Director:

JOHN FETSCH 701.212.1026 jfetsch@prairiebizmag.com Sales:

BRAD BOYD - western ND/western SD 800.641.0683 bboyd@prairiebizmag.com SHELLY LARSON - eastern ND/western MN 701.866.3628 slarson@prairiebizmag.com Editor: KRIS BEVILL 701.306.8561

kbevill@prairiebizmag.com

Editorial Advisors: Dwaine Chapel, Executive Director, Research Park at South Dakota State University; Bruce Gjovig, Director, Center for Innovation; Lisa Gulland-Nelson, Vice President, Marketing and P.R., Greater Fargo Moorhead EDC; Tonya Joe (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.

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

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The name CenturyLink and the pathways logo are trademarks of CenturyLink, Inc.

Online www.prairiebizmag.com

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|BUSINESS ADVICE|

Bad debt deals

BY MATTHEW D. MOHR usinesses use financing through accounts receivable and loans. All loans and credit allowed on account are entered into with the expectation of full repayment when due. Unfortunately, sometimes financing is not repaid. Extending credit involves the risk of not being paid. Bankers face this challenge nearly every day as loans granted turn sour or become uncollectable. Most good credit analysts look at repayment histories as well as the assets and liabilities of the borrower.

When dealing with direct customers or on a more local and regional basis, the best credit managers go beyond numbers and work hard to assess the individual’s “credit repayment character.” A person or business which chooses not to repay money owed once is much more likely not to repay a future obligation. Similarly, businesses that constantly argue about charges or find excuses to pay less than amounts due are often those who ultimately fail to repay their obligations in full.

Our media is filled with articles and information about having a good personal credit score, but businesses

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also want to build a good credit reputation. Credit rating agencies assign credit scores to businesses to help others make decisions about extending credit to a particular enterprise. Once again, while dealing directly with a business locally or regionally, knowing the reputation of the individual owner and the people involved makes a huge difference in the decision to extend them credit.

Individuals and businesses do build repayment reputations. Over the years, most credit managers get to know who the “deadbeats” are and will refuse to lend or sell to certain customers because of poor repayment history. When a person decides to not pay his/her bills in one circumstance, and then moves on elsewhere, chances are they might not pay when things get tough in their new endeavor either.

A good credit history is something to build as an individual and as a business enterprise. PB Matthew D. Mohr CEO, Dacotah Paper Co. mmohr@dacotahpaper.com

|MANAGEMENT MATTERS|

Does happiness matter?

BY JOHN GIRARD have been to two conferences lately where peoplebased management techniques were targeted as the root of all evil. There seemed to be growing consensus that the secret to leadership success in the new millennium might be a move to the scientific theory of management. The proponents argued, rather persuasively, that leaders must focus on labor productivity.

I watched in amazement as audiences became wowed, perhaps even convinced, that Frederick Winslow Taylor’s ideas of 100 years ago might be the wave of the future. The Taylorists went on to suggest that managers needed to stop worrying about whether workers were happy. After all, they suggested, with high unemployment in the U.S., there were many workers available to replace those who are more worried about being happy than productive.

I hope the readers of Prairie Business are not tempted by such shallow promises of increased productivity by commodifying people. Despite what some dra-

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conian thinkers might suggest, people, and their happiness, do matter. Arguably the best route to increased productivity, if that is the goal, is through a focus on your people. The old adage “a happy worker is a productive worker” is as true today as it ever was.

Not convinced? Take a look at the 2013 GallupHealthways Well-Being Index (www.wellbeingindex.com) in which North Dakota, South Dakota and Minnesota rank in the top four states in the country. Prairie leaders understand that liking what you do each day, having supportive relationships and liking where you live all lead to high well-being scores.

I wonder if those conference speakers I mentioned hailed from West Virginia (number 50 on the list). PB John Girard Professor of Management, Minot State University Founder, Sagology John@JohnGirard.net Twitter: @JohnGirard

|FINANCE|

Eliminating credit union tax exemption bad public policy

BY STEVE POCIASK

ome banks are asking state legislators and local officials to pass resolutions calling on the U.S. Congress to eliminate the nonprofit status of credit unions, effectively imposing new taxes on the banks’ smallest of rivals. The “ask” smacks of protectionism, the arguments for legislative change are weak, and state lawmakers should not fall for it.

Credit unions are member-owned, not-for-profit institutions that plow each dollar of surplus back to their members — who are consumers. Credit unions have no shareholders, have no equity investors and are served by volunteer boards. Since credit unions plow their retained earnings back into their member-owned entities, there really are no real profits to tax. Instead, credit union members have their benefits taxed at their personal income tax rates. If credit unions are taxed upfront, as banks have suggested, the result would be double-taxation of credit union members.

Banks are for-profit, have private investors and stockholders, can make lavish payments to board members, and dividends to their stockholders. They make profits that are taxable. As for bank consumers, they pay taxes only once in the form of personal income tax, just as credit union members currently do. Paying once is enough.

Will the bank’s plan of eliminating the credit union tax exemption help Americans? The Congressional Joint Committee on Taxation estimated the exemption cost taxpayers $500 million in taxes in 2012. Because credit unions tend to offer higher interest rates on member deposits and lower rates on member loans compared to banks, consumers get $8.1 billion more in benefits than they would get from banks. Therefore, eliminating the nonprofit status of credit unions could cost consumers $16 for every $1 of taxes saved.

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That would be a really bad deal for consumers, taxpayers and voters.

Banks are not in need of protection from competition. In fact, credit unions account for only 6 percent of the market’s financial assets, with the remainder being held by banks. Credit unions operate with lower net charge-offs and almost one-third of the delinquency rate of banks, making credit unions a much safer place for consumers to put their savings. Yet, if the taxexemption were eliminated, the consequences would be clear — it would cause member benefits to dissipate, leading credit unions to "demutualize" and reduce them to the same behavior as banks, as well as increasing market concentration for the "too big to fail" banking industry. That would expose taxpayers and depositors to even more risks, not less.

The banks’ goal is this — use the legislative process to destroy competition. Calling on state legislators to pass resolutions in support of higher taxes is the path to achieving this goal. State and federal legislators should not fall for it.

Moreover, public policy should encourage competition and not protect competitors. In the midst of “too big to fail” banks, credit unions provide a necessary choice for consumers. Let them compete in the marketplace for customers and not for public policy favors. PB Steve Pociask President American Consumer Institute Center for Citizen Research steve@theamericanconsumer.org This article is in response to an article published in Prairie Business magazine on Dec. 28, 2013 by Curt Everson, president-CEO of the South Dakota Bankers Association. Portions of this article first appeared in “The Hill’s Congress Blog” and are reprinted with permission by the author and “The Hill’s Congress Blog.”

|RESEARCH & TECHNOLOGY|

World-class Sanford Lab supports local education, economy

BY CONSTANCE WALTER

he Sanford Underground Research Facility (Sanford Lab), located at the former Homestake gold mine in Lead, S.D., is the deepest underground laboratory in the United States. The lab hosts several competitive, worldleading physics experiments nearly a mile underground; touches the lives of thousands of students and teachers every year; and has a huge impact on the regional economy.

Homestake Mining Co. closed the mine in 2003 and donated the property three years later to South Dakota for use as an underground laboratory. That same year, philanthropist T. Denny Sanford donated $70 million and the state legislature committed $40 million to the project. The state also received a $10 million HUD grant to rehabilitate Homestake mine. Current funding for Sanford Lab operations comes from the U.S. Department of Energy.

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World-Leading Research Physics research is not new to Sanford Lab. In the mid-1960s, nuclear chemist Ray Davis installed a detector at the 4850 Level to research neutrinos. His experiment earned Davis a share of the 2002 Nobel Prize in physics.

Today, the Davis Campus on the 4850 Level houses two major experiments: the Large Underground Xenon (LUX) experiment, which is searching for dark matter; and the MAJORANA DEMONSTRATOR (MJD) experiment, which is looking for a rare form of radioactive decay. LUX has published an analysis of their first data set, which has made a big impact in the race to detect dark matter. The first data from the MJD experiment is expected in early 2015.

A third major experiment is in the planning stages.

The Long Baseline Neutrino Experiment is a joint project between Fermilab in Batavia, Ill., and Sanford Lab. The estimated construction cost for facilities and experiment hardware based in South Dakota is $275 million and the DOE has committed $26 million to the project

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this year alone. When completed in 2023, LBNE will shoot a beam of neutrinos through the earth from Fermilab, 800 miles away, to an enormous detector underground at Sanford Lab. The experiment will collect data well into the 2040s.

Many disciplines benefit from access to an underground facility dedicated to scientific research. Over all, there are 15 active groups at the lab conducting research in the fields of biology, engineering, geology and physics.

Fourteen of those groups include students and faculty from South Dakota universities and colleges.

Education and Outreach Sanford Lab seeks to inspire students, teachers and the general public to explore science, technology, engineering and math (STEM) through a variety of education and outreach programs. Since 2009 more than 7,000 students and 1,500 teachers have participated in workshops, field trips and after-school programs, while more than 13,000 members of the general public have attended presentations around the state and the lab’s annual science festival, Neutrino Day.

Economic Impact Sanford Lab has contributed greatly to the state’s economy. The Lab’s activities support 159 jobs in the state. Since 2004, it has spent more than $120 million in South Dakota and places an emphasis on working with small, regional businesses. And finally, the lab offers a variety of paid internships to students from South Dakota universities, allowing those students to gain valuable hands-on experience in STEM fields and remain in the state.

For more information about the experiments at Sanford Lab, go to www.sanfordlab.org. PB Constance Walter Communications Director Sanford Underground Research Facility cwalter@sanfordlab.org Twitter: @SanfordLab

INTEGRATION AND COMMERCIALIZATION ON THE NORTHERN PLAINS

2014

HONORARY CO-HOSTS U.S. SENATORS JOHN HOEVEN & HEIDI HEITKAMP

JUNE 25 & 26 REGISTER AT THERESEARCHCORRIDOR.COM/UASSUMMIT2014 A GLOBAL DESTINATION FOR THE UAS INDUSTRY What many thought would takes years is now upon us with the growing use of unmanned systems in civil and commercial markets – and the pending announcement of six national test sites. With increased use of UAS by law enforcement and first responders and growing interest, new applications and research being conducted by precision agriculture, transportation, infrastructure and planning agencies, the future is indeed here.

Join North Dakota Senators John Hoeven and Heidi Heitkamp the Red River Valley Research Corridor in Grand Forks, North Dakota June 25 & 26 for the 8th Annual UAS Action Summit as we explore where the UAS industry is now and the potential it has in the future. The 2014 UAS Summit is being co-hosted by Northern Plains UAS Test Site Authority and the ND Dept. of Commerce, U.S. Senators John Hoeven and Heidi Heitkamp, Red River Valley Research Corridor, and the City of Grand Forks.

Hear from unmanned systems experts from federal agencies, universities and civil and commercial entities as they identify current and future unmanned system applications and solutions. Interface and network with presenters, industry experts, vendors and new partners during this fast-paced two day industry event.

Speaker Session Topics Include: • Airspace Integration Strategies • Northern Plains UAS Test Site Briefing • Commercial Applications in Precision Ag • Civil Applications in Law Enforcement • UAS Flight Demos • Privacy and Ethics Exploration • Energy Industry - Monitoring Assets (pipelines, transmission, operations) • International Collaboration Featured Speakers: Michael Toscano, President of the Association for Unmanned Vehicle Systems International (AUVSI) North Dakota Governor Jack Dalrymple Bob Becklund, Executive Director of Northern Plains Unmanned Systems Test Site U.S. Senator John Hoeven U.S. Senator Heidi Heitkamp

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|ECONOMIC DEVELOPMENT|

Access to transportation networks attracts businesses

BY KLAUS THIESSEN

n today’s fast-paced, on-demand environment, communities must make proactive and strategic investments in infrastructure in order to be responsive to development opportunities.

Strategic location and diverse transportation networks have reemerged as two of the most important business considerations for companies expanding in our region.

At the heart of infrastructure needs is access to transportation networks. Grand Forks, N.D., and East Grand Forks, Minn., grew around the intersection of two rivers at a time when barges transported goods.

Today, much of the Grand Forks region’s growth is due to its location at the intersection of two primary highway corridors. We are a primary link to the U.S. from Canada via the north/south Interstate 29. And running right through the region, Highway 2 connects us to the Duluth, Minn., port to the east and the Bakken to the west.

While growth related to North Dakota’s oil activity garners the majority of media headlines and is undoubtedly an underlying factor in many expansions in our region, agribusiness and logistics operations are rapidly expanding in our region as well.

Companies locate and expand here because Grand Forks is a Midwest distribution hub for their national and international markets and provides efficient access to air service, rail, and highways.

The City of Grand Forks and the Economic Development Corp. are planning prudent infrastructure investments to position the region for even greater industry growth, building on our inherent

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logistics infrastructure strengths.

• A 125-acre business park on the frontage of I29 was developed with primary infrastructure and within six months two lots were taken.

• Our Metropolitan Planning Organization just completed a rail access study to identify potential areas of growth we can pursue to enhance rail access for regional companies.

• We are in the midst of an infrastructure planning initiative, identifying six strategic areas for growth that will allow us to be flexible in our response to industry development.

• Our location under uncongested skies is driving new commercial development in the unmanned aerial systems (UAS) sector.

• The Grand Forks International Airport is proactively planning for its growth.

The days of communities waiting for an economic development project before making investments are over.

Mayor Michael Brown reinforced this in his 2014 State of the City address saying, “The city has a new role to play in promoting growth and development, not just responding to it. We are focusing on the right resources, right place to make Grand Forks a sweet investment for both expansion and new development.” PB Klaus Thiessen President and CEO Grand Forks Region Economic Development Corp. klaust@grandforks.org Twitter: @gfredc

Port of Raymond Plentywood

Culbertson

Williston Watford City

Theodore Roosevelt Expressway

Grassy Butte Dickinson Belfield Amidon

Port-to-Plains Alliance Corridor

Bowman

Saskatoon

Regina Port of Raymond Williston

Rapid City Torrington

Scottsbluff

Denver

Limon

Buffalo

Belle Fourche Spearfish Sturgis

Rapid City Custer

Raton Amarillo

Hot Springs

Lubbock Midland

San Angelo Del Rio

Laredo Monterrey

Theodore Roosevelt expressway www.trexpressway.com

Economic Development www.willistondevelopment.com

The Theodore Roosevelt Express- TRE is a nonprofit, tax exempt way is part of the Ports-to-Plains organization that works with Alliance, a proposed four-lane Departments of Transportation in divided highway system that Montana, North Dakota, South promotes trade and transporta- Dakota, and Saskatchewan to tion nationally and internation- promote infrastructure improvally throughout the Rural ments to enhance safty, improve Heartland of America. The trade efficiency and freight Corridor begins in Laredo, TX and movement, and create economic transverses through the rural growth opportunities along the heartland of America into corridore. The TRE is commited to Canada via the Port of Raymond benefitting the region by working in Montana. The Ports-to-Plains with partner organizations, local Alliance is federally designated political subdivions, state and as a High Priority Corridor where federal agencies and private this designation qualifies the sector business.

Alliance for special federal funding above and beyond each states standard alloment of Federal Highway funds

The Theodore Roosevelt Expressway helping to connect the DOT’s!

TRE is the collector corridor for six major east-west highway systems that service major oil and gas development areas.

TRE is also the transportation corridor for oil supplies from Edmonton, Calgory, and Regina in thenorth to Houston, Dallas and Denver inthe south.

Prairie News

Industry News & Trends

Essentia adds advanced radiation machine at Fargo Cancer Center Essentia Health has invested $5.4 million to purchase a Versa HD linear accelerator, which is being installed at the organization’s cancer center in Fargo, N.D. The machine is the first of its kind to be used in North Dakota and will allow Essentia to treat its cancer patients more quickly and precisely by delivering high doses of radiation through an intense laser, according to Brie Corfman, director of the Essentia Health Cancer Center.

The installation of the machine required special room modifications including increasing the thickness of the floor to support the weight of the machine and the installation of threefoot-thick concrete walls and a special locking door to retain radiation within the room.

The cancer center expects to treat its first patients in late June.

The Essentia Health Cancer Center in Fargo will soon begin treating patients with a Versa HD linear accelerator, an advanced machine designed to deliver high doses of radiation to cancer patients.

PHOTO: ESSENTIA HEALTH

Showplace Wood Products to expand

Williston Area Rec Center opens

Harrisburg, S.D.-based Showplace Wood Products, a maker of high-end cabinetry, has been approved for a Revolving Economic Development and Initiative Fund loan to purchase new equipment, leading to the creation of more than 100 jobs within the company over the next three years, according to the South Dakota Governor’s Office of Economic Development.

The employee-owned company has utilized the state’s REDI Fund several times since its launch in 1999. Scott Korsten, Showplace director of marketing, says it is “exciting and rewarding to again find it necessary to expand production capacity and add employees.”

The Williston Area Recreation Center, North Dakota’s largest indoor rec center and the largest park district-owned recreation center in the country, recently opened for business in Williston, N.D. Designed by JLG Architects and built by JE Dunn Construction Co., the 254,000square-foot facility includes a 50-meter, eightlane swimming pool, four basketball courts, four indoor tennis courts, an indoor gymnasium with running track, a 54,000-square-foot fitness area and meeting rooms, among other amenities. An indoor water park features a wave simulator, whirlpool and a lazy river slide, installed by JE Dunn’s construction team.

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The facility was completed on time and under budget, according to JE Dunn. Sustainable elements were used in the facility’s construction and it is seeking LEED certification.

SBA temporarily suspends loan fees The U.S. Small Business Administration has suspended its 2 percent loan-guarantee fee for loans of $150,000 or less through Sept. 30. The reduction is expected to increase funding available for small businesses, spur the economy and create more jobs, according to the agency.

In addition, the SBA is waiving the guaranty fee on loans of up to $350,000 made to veterans through the SBA Express program. That program reduction is also in effect through Sept. 30.

|PRAIRIE NEWS|

HD LED video displays manufactured and installed by Daktronics at the National Football League’s Jacksonville Jaguars stadium in Jacksonville, Fla., will be the largest displays of their kind in the world. IMAGE: DAKTRONICS

Growing demand, big projects prompt widespread hiring at Daktronics A $170 million backlog of orders going into its fourth quarter, including large orders from several National Football League teams, has prompted Brookings, S.D.-based Daktronics to launch a widespread employee recruitment campaign to fill positions at its locations in Brookings and Sioux Falls, S.D., and Redwood Falls, Minn.

Among its orders is a commitment to manufacture and install the two largest HD LED video displays in the world — each one measuring 60 feet high by 362 feet wide — at the Jacksonville Jaguars' field in Jacksonville, Fla. Matt Kurtenbach, Daktronics' vice president of manufacturing, says as NFL stadiums continue to upgrade facilities and increase the size of their scoreboards, Daktronics must increase its production to keep up with demand.

Wall Clinic joins Regional Health

tem of more than 40 entities and is the largest health care provider in western South Dakota.

Wall Clinic in Wall, S.D., has joined Rapid City, S.D.-based Regional Health and is now known as Wall Regional Medical Clinic. Regional Health has managed the clinic for 18 years.

Regional Health is an integrated health care sys-

SD-based auto glass supplier expands regional presence Dakotaland Autoglass, a wholesale supplier of auto glass and PPG automotive aftermarket and commercial coatings, made acquisitions in

North Dakota and Colorado in 2013 and now has 18 locations in six states.

In North Dakota, the company acquired the PPG automotive aftermarket coatings distributorship in Minot, Williston and Dickinson from Praxair and expanded into a larger facility in Minot. Dakotaland also joined with CR Autoglass to expand the company’s presence in

www.prairiebizmag.com

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|PRAIRIE NEWS|

BHSU goes underground at Sanford Lab A site has been designated for a Black Hills State University underground campus at the 4850 Level of the Sanford Underground Research Facility in Lead, S.D. The campus will include a cleanroom which will allow students and faculty to conduct a variety of research projects including low-background counting physics experiments. It will also offer opportunities for faculty and staff to collaborate with scientists in groundbreaking research.

BHSU is located less than 20 miles from the Sanford lab, which is the deepest underground lab in the U.S., and has collaborated with the facility since its launch in 2007.

A site has been designated for a Black Hills State University underground campus at the 4850 Level of the Sanford Underground Research Facility in Lead, S.D. Pictured at the site is BHSU President Kay Schallenkamp and Mike Headley, director of the Sanford Lab. PHOTO: BLACK HILLS STATE UNIVERSITY

the auto glass market in Dickinson.

In Colorado, the company acquired a wholesale aftermarket auto glass distribution business in Denver.

The company now operates six locations in South Dakota, two locations in Iowa, two locations in Minnesota, two locations in Colorado, one location in Wyoming and five locations in North Dakota.

NDGT unifies location names North Dakota Guaranty & Title Co. is transitioning all of its eight North Dakota offices to one corporate name. Offices in Bismarck, Dickinson, Killdeer, Mandan, Watford City, Minot, Mohall and Williston will operate under the North Dakota Guaranty & Title Co. name.

Nick Hacker, company president, says unifying the location names provides increased continuity of services and brand recognition for customers.

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Basin Electric gets nod for more Bakken power Basin Electric Power Cooperative received final approval from the North Dakota Public Service Commission on March 26 to construct two 45-megawatt units at its Lonesome Creek natural gas-fired peaking station near Watford City, N.D. The station’s first 45-megawatt unit came online in December. Construction of units 2 and 3 will begin this spring and should be complete later this year, according to the cooperative.

Drilling and oil production activity in the Bakken region is largely responsible for the increased demand for electricity.

NWMF seeks outstanding ‘community builders’ The Northwest Minnesota Women’s Fund is accepting nominations for its annual

“Community Builders” awards, which recognize women in northwest Minnesota for their leadership, mentorship and professional excellence.

Nominations are due by June 2. Receptions will be held in recipients’ hometowns later this year.

For more information, visit www.nwmf.org.

SD accepting proposals for Lewis and Clark Lake marina The South Dakota Game, Fish and Parks department is encouraging entrepreneurs interested in operating a marina on Lewis and Clark Lake near Yankton to submit their proposals for the business by June 30. The agency has made available a prospectus for the operation of Lewis and Clark Marina as well as details of the business opportunity and investment requirements on its website at http://gfp.sd.gov/stateparks/directory/lewis-and-clark/.

|PRAIRIE NEWS| Alerus Financial acquires Twin Cities’ Private Bank Minnesota Grand Forks, N.D.-based Alerus Financial recently acquired Twin Cities-based Private Bank Minnesota. The acquisition consisted of approximately $142 million in banking assets and increases Alerus’ Twin Cities banking assets to about $398 million.

As of Dec. 31, Alerus had total banking assets of $1.4 billion and total wealth management assets under management and administration of $14.7 billion.

DFC Consultants celebrates 25 years of business Software sales company DFC Consultants is celebrating its 25th anniversary with open houses at its Fargo and Dickinson, N.D., locations on May 1 and May 13, respectively. Founded by Carol Rogne in Dickinson in 1989, DFC Consultants has since grown to include three locations across North Dakota.

The company offers sales and support of business software, and offers accounting services,

www.prairiebizmag.com

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|PRAIRIE NEWS|

Altru Health System recently opened the Altru Specialty Center in Grand Forks, N.D., marking the first hospital opening in the city since 1976. PHOTO: ALTRU HEALTH SYSTEM

Altru Specialty Center opens inpatient rehab unit Altru Health System in Grand Forks, N.D., recently opened an inpatient rehabilitation unit at its Altru Specialty Center, marking the first hospital opening in Grand Forks since 1976. The approximately 91,000-square-foot specialty center is a 45-private-bed hospital with four operating rooms and is the only hospital of its kind in eastern North Dakota to have single specialty care under one roof, according to the organization.

Moving inpatient rehab patients from Altru Hospital’s campus to the specialty center will also enable the organization to continue plans for private room conversion at the hospital campus, the organization says.

custom programming and DFC Cloud. It also developed a property management software called DFC Property Management.

DCN ramps up transmission speeds Dakota Carrier Network recently added Google, Netflix and YouTube servers at its facilities in Fargo and Bismarck, N.D., to provide video data and other content from those services at faster transmission speeds than were previously available.

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DCN and its owner companies have set a goal of providing fiber-based broadband services to every part of North Dakota and have invested more than $1.2 billion in broadband infrastructure over the last decade. An average of $120 million per year has been committed to complete the fiber initiative.

Starion Financial recognized for small business lending The North Dakota district office of the U.S. Small Business Administration awarded Starion

Financial with the director’s award for fiscal year 2013 in recognition of its commitment to financing small business using SBA programs.

Starion Financial was one of six top lenders recognized in the state. “We compete for North Dakota business with many other good, experienced SBA lenders,” says Tim Dowling, business banking executive vice president. “But, we think our unique blend of attributes will provide the best possible results for small businesses.”

BACK TO THE FUTURE North Dakota was built with hard work, community dedication and an active railroad. Designed

by JLG, the Midland Continental Railroad Depot in Wimbledon and the Camp Hancock Locomotive Shelter in Bismarck honor our early heritage in modern structures designed to enhance the historic fabric. The Depot tells the story of the 1913 Midland Continental and traces the career of singer Peggy Lee, while the Camp Hancock site highlights Northern Pacific Locomotive No. 2164 and the nearby 1872 military installation.

jlgarchitects.com

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|PRAIRIE PEOPLE|

Scott Meske

Lisa Hauck

Williston Area Chamber names new president

Anderson to chair USD family medicine department

Scott Meske has been named president and executive director of the Williston (N.D.) Area Chamber of Commerce. Meske previously served as a statewide association executive in Wisconsin, specializing in policy development, member relations and communications.

Dr. Susan Anderson has been named the next chairperson of the University of South Dakota Sanford School of Medicine’s Department of Family Medicine. She will replace Dr. Bruce Vogt, who is retiring in June.

Anderson has been a family medicine department faculty member since 2000. She is director of the Frontier and Rural Medicine program, associate professor and vice-chair of Clinical Foundations and Rural Education, director of the Clinical Foundations component of Pillar 1, and a member of the governor’s primary care task force and the USD Sanford School of Medicine Alumni Council. She currently serves as medical director of the Canistota Good Samaritan Center.

Hauck, Kauffman in new roles at NDSU The Office of International Programs within North Dakota State University’s equity, diversity and global outreach division is being reorganized to better and more directly serve student and faculty needs. Changes include updated department names, areas of responsibility and directors.

Lisa Hauck, former director of the international programs office, is now director of the Office of Global Outreach. The office will provide leadership and support for NDSU globalization efforts, including recruitment and admission of international students, international faculty and visiting scholar immigration.

Alicia Kauffman will direct the existing international programs office, which has been renamed the Office of International Student and Study Abroad Services. The office provides support services for graduate and undergraduate international students and students studying abroad.

Susan Anderson

Brown & Saenger hires Schmitz as branch manager Brown & Saenger has added Randy Schmitz as branch manager of its Fargo, N.D., office. In this role, he will be responsible for working with the staff and supporting sales efforts in the Fargo marketplace. Before joining Brown & Saenger, Schmitz served as territory sales representative/manager for Cole Papers of Fargo.

Randy Schmitz

Alicia Kauffman

Stoneridge Software adds 6 for new division Barnesville, Minn.-based Stoneridge Software recently created a Microsoft Dynamics NAV division and added six employees to staff the new division. New employees include Sean Solberg, principal consultant; Scott Frappier, principal consultant; Bob Andrews, senior consultant; Marek Tylko, senior consultant; Matt Batalden, senior consultant and Laura Lake, senior developer.

Stoneridge Software was founded in 2012 by three former Microsoft employees and has since grown to include more than 25 employees at locations in Barnesville and Minneapolis.

From left: Scott Frappier, Bob Andrews, Laura Lake, Marek Tylko and Sean Solberg

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FUTURE OF THE BIO-INDUSTRY: FEED, FUEL, HEAL & BUILD THE WORLD

THE FUTURE OF THE BIO-INDUSTRY

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|BUSINESS DEVELOPMENT|

Rick Brandenburger, president of Richland IFC Inc., meets with Chinese buyers during the 2014 China-North Dakota ‘Better for You Food Ingredients’ conference and exhibition, held March 20-21 in Quingdao, Shandong, China. PHOTO: NORTH DAKOTA TRADE OFFICE

Creating the China market Trade missions educate Chinese buyers, expand export opportunities

BY KRIS BEVILL t’s the largest country in the world (more than 1.3 billion people and growing) and its rapidly expanding middle class is hungry for everything their newfound money can buy. China represents huge potential for U.S. exporters, but finding a way into the market can be a daunting task.

To help scale the hurdles of exporting to China, groups from throughout the northern Plains have hosted multiple trade missions in recent months for local companies to introduce themselves to Chinese buyers and begin relationship building. In March, the North Dakota Trade Office, along with the North Dakota commerce and agriculture departments, hosted its second annual “Better for You Food Ingredients” conference in Quingdao, Shandong, China, where 14 North Dakota companies and organizations had the chance to showcase their products and help educate Chinese buyers on the nutritional value and ways to apply North Dakota commodities to Chinese foods.

This month, South Dakota Gov. Dennis Daugaard will be joined by representatives from 11 South Dakota companies and organizations on the state’s third annual trade mission to China. The trips are designed to make introductions and help break down cultural and trade barriers that may currently trip up U.S. companies, in some instances prompting trade deals that may not otherwise have come to fruition.

“China is South Dakota’s third largest trading partner,” says Ryan Budmayr, business development representative for the South Dakota Governor’s Office of Economic

I

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Development and coordinator of the state’s China trade mission. “Over the last two trade missions to China, we have developed relationships with business leaders and government officials, while gaining a deeper understanding of the Chinese market. South Dakota continues to realize opportunities in China and we view it as a great market to grow sales for our companies.”

South Dakota’s trade mission takes place May 9-16, with stops in Beijing and Shanghai. While there, some attendees will attend a food show in Shanghai and state delegates will meet with Chinese officials and business executives to help facilitate trade contracts for South Dakota companies, according to Budmayr. The U.S. commerce department and the U.S. Department of Agriculture are assisting in facilitating those meetings.

Budmayr says companies that participated in last year’s trade mission are continuing to see results, including the recent sale of 110 tons of scrap paper to a Chinese company met during the mission. “As with many business deals, we believe that the connections made by the businesses last year will result in future sales and growth in the years to come,” he says.

Companies participating in this year’s South Dakota mission represent a number of industries and include Advanced Sunflower, Badger State Recovery, Concord Grain, Dakota Trim and Steel, Muth Electric, South Dakota State University International Affairs Outreach, Sharp Industries, Valley Queen Cheese Factory Inc. and Vern Eide International.

|BUSINESS DEVELOPMENT|

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

“Serving the Area Since 1906”

• • • • • • •

Disposable Paper Products Food Service Supplies and Equipment Sanitary Maintenance Products and Chemicals Shipping and Mailing Supplies Office and Computer Supplies Electrical Products Healthcare Specialty Products

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NDTO’s event included representatives from agbased companies including United Pulse Trading, Specialty Commodities Inc., Soyko Inc., Healthy Oilseeds, Great Northern Ag and JB Global.

Jeff Pricco, president of Burnsville, Minn.-based export firm JB Global, attended the trip as a representative of Breckenridge, Minn.-based Richland IFC Inc., which specializes in non-GMO (genetically modified organism) and organic soybeans and corn. Pricco says he attends NDTO trips like the “Better for You” event because they are a good value for the cost to attend and regularly produce valuable contacts. His focus of this particular trip was to open up the nonGMO food-grade soybean market, which currently faces trade barriers including additional duties imposed on the product compared to other types of soybeans and a lack of acceptance of the product from Chinese buyers. Pricco believes that will begin to change in the next few years, however, as China continues to consume more soybeans than it can produce.

Relationship building and deal-making with Chinese buyers can be a long process, so while Pricco believes his company may increase its exports of certain products, such as dried peas, to China this year, it will realistically be some time before the country represents a large portion of his company’s sales.

“We’re optimistic in the long-term on China, but as to whether for our unique business it’s going to be big right away, I don’t think so,” he says.

China is currently the 12th largest export market for North Dakota, but state representatives are aggressively working to improve that number. The sisterstate relationship recently announced between China’s Shandong province and North Dakota helps to raise awareness in the Chinese market, and events such as the “Better for You Food Ingredients” conference help educate Chinese buyers and food scientists about the state’s products, says Dean Gorder, NDTO executive director. “China is a difficult market to break into,” he says. “Once you break into it, it is a large market and is not just significant in numbers. It’s a relationshipbased market, so once you establish that relationship it tends to go on for a long period of time.”

He says this year’s food ingredients conference was more focused on providing information to a targeted audience of food buyers and food scientists, attracting approximately 125 attendees to the event.

The group plans to host a reverse trade mission for Chinese buyers again this fall, where deals begun during the March trip may be finalized. PB

Discover the Dacotah Difference Answers You Can Trust From People Who Care

1-800-323-7583 www.dacotahpaper.com www.prairiebizmag.com

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|TRANSPORTATION|

Bearing the Load Trucking firms develop training programs to teach new drivers, fill worker demand

BY KRIS BEVILL

Bruce Stegner, a trainer at MBI Energy Service, signals to a driver at the company’s training facility near Belfield, N.D. PHOTO: STEVE BORAAS

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|TRANSPORTATION|

A veteran’s wall at Britton Transport’s Grand Forks, N.D., office honors its many employees who have served in the U.S. military. The company makes veteran recruitment a priority and is active with multiple military-focused job placement groups. PHOTO: BRITTON TRANSPORT

rucks play a vital role in the movement of goods through the entire U.S., but for the isolated prairie communities scattered throughout the northern Plains, that role is amplified. In North Dakota, for example, half of the state’s communities are served exclusively by trucks and nearly 70 percent of manufactured tonnage moved within the state is transported by for-hire carriers, according to the North Dakota Motor Carriers Association.

Bakken oil producers also rely heavily on trucks and have further increased demand for trucks and drivers in the state. It is estimated that 2,300 truck trips are required to develop every Bakken well. Recently released projections suggest that at least 40,000 wells could be drilled in the Bakken and Three Forks formations over 20 years, and trucks are expected to continue to be a key requirement for well service and maintenance.

The reliance upon trucks to move goods and support

T

oil production translates to good business for trucking firms in the area, but it also makes truck operators a valuable commodity, and many firms are struggling to find drivers to keep up with demand.

“Those needs for drivers, coupled with low unemployment, makes for kind of a tough situation for trucking companies to find help,” says Arik Spencer, executive vice president of the North Dakota Motor Carriers Association.

Indeed, North Dakota trucking firms have ample available openings for those holding commercial driver’s licenses (CDLs) to choose from. On April 11, a keyword search for “truck driver” on Job Service of North Dakota’s website showed 500 listings representing at least 857 openings within the state. Job Service’s April 1 online job openings report found that of the nearly 23,000 open jobs, the transportation and material moving sector had 2,294 job openings — more than any other non-military occupational group in the state. (Office and administrative support was a close sec-

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|TRANSPORTATION|

ond with 2,292 job openings.)

While the current need for drivers in North Dakota is apparent, the shortage of truck drivers has also been a nationwide issue for several years and is one of the industry’s biggest concerns. “A lot of the fleets in North Dakota and across the country have a portion of their trucks sitting idle because there are no drivers to drive them,” Spencer says.

He says industry estimates place the current nationwide shortage of drivers at about 30,000 and an estimated 100,000 replacement drivers are expected to be needed every year over the next decade to keep up with an anticipated increasing number of shipments and to offset a large number of retiring drivers. Meanwhile, firms everywhere must find ways to recruit new drivers whenever possible and battle constant turnover as in-demand drivers move freely from job to job.

Making Driving Attractive The average annual salary for truck drivers in North Dakota is about $42,000, according to the NDMCA. Oilfield truck drivers can make two or three times that amount.

Companies are adjusting their rates of pay to remain as competitive as possible within their area, but, there are additional ways trucking firms can make their workplace more appealing for new hires and existing drivers.

Up-to-date equipment is a benefit for drivers and Spencer says firms are investing in new equipment “as much as possible” to keep them happy. Some firms are also modifying routes in order to ensure that drivers can be home with their families more often, in some cases every night.

Some firms have taken an active interest in training young drivers to fill their supply line of new employees.

Britton Transport, a trucking firm with about 120 drivers and locations in Grand Forks, N.D., and Sioux Falls, S.D., collaborated with parent company Bison Transport late last year to develop a training program to give new drivers the overthe-road experience needed to satisfy insurance requirements. The Britton Transport Finishing Program provides new drivers with in-cab instructor training for up to nine weeks, followed by other training phases to provide them the necessary two years of experience.

Senta Brookshire, safety and driver development director at Britton Transport, says although many firms are actively seeking drivers, new drivers often find it difficult to get jobs because they lack required experience. The program offered

by Britton Transport is focused on helping drivers get past that hurdle, hopefully creating life-long employees in the process. Five drivers have so far signed on for the program and interest is growing, she says.

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“Our insurance company has been extremely happy with it and so far it has been really successful,” she says, adding that the company has also reached out to community colleges and technical schools to further tap into the new driver market.

Britton Transport has also made veteran recruitment a priority. Brookshire says about 30 percent of the company’s truckers are former military members (herself included) and the company celebrates those employees with a veteran’s wall at the Grand Forks location. The company is also active with job placement groups like Hero 2 Hired and Troops to Truckers. “With cuts in the military, there is going to be a lot of people saying, ‘I don’t have a job. How do my skills translate?’ A lot of them are trucking positions,” she says. “To find that resource and pull those skills in and make them fit into your business is key and it’s a good thing to do.”

In early April, Brookshire says Britton Transport had only five open positions for drivers and had hired drivers to fill those openings, but she says maintaining a full driving staff has been difficult. The retention rate at Britton has been “fairly good,” but Brookshire admits the rate of churn is a common concern. “There are a lot of trucking companies and not a lot of drivers, so there are a lot that are shopping around,” she says. “They try one place and then move to another because they know they are a valued position, so they can go and test other things out easily and come back to a company, too, if they find out that one is better.”

The Bakken Effect The infamous high wages of the Bakken oilfields have drawn many drivers away from the eastern side of the state and throughout the nation, but not all find the unique conditions of Bakken driving to be worth the money. Brookshire says Britton Transport has lost several drivers to higher-paying opportunities in the Bakken — all but one have returned.

For Britton’s drivers, quality of life and the high cost of living were significant factors in their decision to leave the oil patch. But for many drivers, a lack of preparedness for the conditions of North Dakota oilfield trucking can quickly drive new hires away. MBI Energy Services, an oilfield services trucking firm with more than 700 company drivers in North Dakota, has taken a proactive approach to readying new drivers for oilfield work. About four months ago, the company opened an elaborate training facility near Belfield, N.D., to provide drivers with hands-on experience under the watchful eye of a trainer before they are sent on to in-the-field training.

MBI spokesman Nate Jorgensen says the facility was built to provide drivers with a better understanding of oil-

|TRANSPORTATION|

MBI Energy Services’ training facility near Belfield, N.D., includes a working model of an oil well production site.

PHOTO: STEVE BORAAS

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|TRANSPORTATION|

field work and experience as they transition into the oil patch.

“There are tens of thousands, probably hundreds [of thousands], of individuals out there with a CDL that drive and may have a lot of experience, but that experience lies within the ability to operate the equipment we see driving on the roads every day,” he says.

Oilfield work is a specialized field, however, so traditional driving experience does not necessarily transfer. MBI’s facility is meant to train those individuals to operate safely and effectively, hopefully creating long-term oilfield drivers.

“We significantly decrease the individuals that leave us based upon the ability to train them effectively and provide what they need to make a career, not just a job,” he says.

Jorgensen did not disclose the total cost of the training facility but says MBI has dedicated a “significant” amount of money to improving conditions for its drivers. The facility sits on 80 acres and is home to intensive weeklong training sessions where drivers are teamed with an instructor and introduced to oilfield-specific tasks and equipment, including fractionation tanks, water transfer processes and chaining tires. Sixteen drivers can participate in each weekly training session. In early April, Jorgensen estimated that 200 drivers had already successfully completed the facility training.

Additional in-field training is provided for a period of up to 30 days following completion of the facility course.

MBI employs more than 800 company drivers at its locations in North Dakota, Texas, Louisiana, Pennsylvania and Wyoming and is constantly adding new drivers. Jorgensen says the company currently has between 50 and 100 openings and it hopes to employ 850 company drivers by the end of May, with plans to continue growing. “I don’t think there’s a point where we plan on stopping,” he says.

All Roads Lead to Home Of course, the shortage of workers in North Dakota isn’t confined to the transportation sector. A new initiative being launched by the state this month is focused on attracting new and former residents back to North Dakota to fill its many job openings.

The campaign, dubbed “Find the Good Life in North Dakota,” is a public-private partnership, funded by the state and Hess Corp., and will focus on five high-demand sectors, including transportation. “Trucking supports so many industries and businesses in the state that it only makes sense, and the demand is incredible,” says Beth Zander, workforce development director at the North Dakota commerce department.

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Engineering, health care, energy skilled trades and information technology will round out the high-demand areas of focus for the campaign. The initiative will utilize digital, traditional and non-traditional marketing tactics to reach target audiences in states including Minnesota, Wisconsin, Indiana, Illinois, Michigan, Ohio and Pennsylvania. Neighboring states as well as Washington, Oregon, Colorado, Alaska and Texas will be secondary targets for recruitment efforts.

In April, Zander said the campaign was still in the development stage, but that the initial phase would use digital marketing to provide specific information to potential workers based upon their location and area of interest. Veterans and military members will be a specific focus of the campaign, as will college and trade school students in Minnesota and other areas. “We fully expect that we’ll try things and change them as needed,” she says.

A similar workforce recruitment campaign in South Dakota last year produced mediocre results and has been revamped slightly to place greater emphasis on attracting former residents rather than convincing new residents to give the state a try. North Dakota is very aware of its southern neighbor’s efforts and plans to focus more heavily on people with a previous connection to the state from the start, according to Zander. “They know what it’s like to live here versus convincing someone who is from three states south of us, wondering if we all freeze to death in the winter,” she says.

For the trucking industry, a life on the road means many firms don’t have to rely on in-state workers to fill their open jobs and so a worker recruitment campaign may not significantly impact their need for drivers. Britton Transport’s Brookshire says her firm recruits drivers from throughout the country, so bringing former residents back to North Dakota isn’t a factor for its drivers. However, the company has multiple administrative positions and has found it more difficult to fill those openings in recent years, so a worker recruitment campaign could be useful in that way.

Ahead of the initiative’s roll-out, NDMCA’s Spencer was also cautiously optimistic that it would help to alleviate workforce issues throughout the state. “It can’t hurt,” he says.

“Obviously when we have more jobs than we have people, we need to do something. So I think it’s worth giving a try.” PB Kris Bevill Editor, Prairie Business 701-306-8561, kbevill@prairiebizmag.com

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|TOURISM|

Valiant Vineyards Winery in Vermillion, S.D., is South Dakota’s oldest winery. PHOTO: SOUTH DAKOTA DEPARTMENT OF TOURISM

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|TOURISM|

Regional Wine Industry Gets Legs Winery numbers grow as cold-hardy grapes, dedicated growers take root

BY ROB SWENSON ineries and vineyards are moving out of the hobby stage and making noteworthy contributions to the economies of Upper Midwestern states.

Wineries with tasting rooms and event facilities are creating profitable niches in visitor industries in Minnesota, South Dakota and North Dakota.

Growing grapes and other fruits for wine also creates options for small farms, but the regional agricultural sector continues to be dominated by crops such as corn, soybeans and wheat.

Minnesota has the oldest and largest wine industry in the three-state region. But South Dakota has experienced solid growth in recent years, and North Dakota is starting to grow, too.

More growers in the region say they are making money raising grapes and selling wine, according to Bill Gartner, a professor of applied economics at the University of Minnesota. Gartner has coauthored several studies about vineyards in northern states.

Wineries are no longer just hobbies and side ventures captivated by the historic romance of the business.

“In the past, if you made enough money on other sources, you’d pump money into wineries. Now they’re becoming businesses,” Gartner says.

Growth of the industry has been fueled by the development of hardy varieties of grapes, which are capable of surviving cold winters.

Minnesota has approximately 45 licensed wineries, South Dakota has 22, and North Dakota has nine, and more are being developed.

“What we’re seeing here in terms of growth is pretty remarkable,” Gartner says. He foresees continuing growth, though probably at a slower pace than in recent years.

Despite the growth of the industry in northern states and elsewhere, California remains what Gartner calls “the big gorilla” of U.S. wine production. “Compared with California, everyone else is a drop in the bucket,” he says.

Most wine produced and sold in northern states is consumed locally. So an area’s population is a limiting factor. That puts sparsely populated states, such as the Dakotas, at a disadvantage.

In addition to weather, growers and winery operators face other challenges, including occasional opposition from critics of alcohol consumption.

State laws also can be a problem in, for example, distribution. Since Prohibition was repealed in 1933, a hodgepodge of state laws has emerged to regulate the wine and beer industry.

Patience and upfront investments also are required because grapes are perennial plants. A few growing seasons must pass before vineyards can produce wine-worthy fruit.

W

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Prairie Berry Winery in Hill City, S.D., has been making wine at a commercial level since 1999. The business has grown in recent years to include an events room at the winery and expanded production capacity. PHOTO: SOUTH DAKOTA DEPARTMENT OF TOURISM

Minn. Leads Region Minnesota’s first winery opened in 1978 in Hastings, according to the Minnesota Grape Growers Association. But it took until 1997 for Minnesota to have three wineries. Minnesota now produces more than 150,000 gallons of wine a year.

“The emergence of cold-hardy wine grape cultivars in the 1990s created a new and rapidly expanding industry of small vineyard and winery enterprises in states across New England, northern New York and the Upper Midwest,” according to a June 2013 report about vineyards and wineries in Minnesota.

The report was coauthored by Gartner and by Brigid Tuck of the U of M in partnership with the Northern Grapes Project. The project involves a coalition of researchers, extension specialists and professionals from 13 states.

Terri Savaryn, secretary and director of marketing for the association, expects that 45 wineries will be open to the public during the coming tourism season in Minnesota. Savaryn is with Sovereign Estate Wine in Waconia.

Wine tasters are like antique shoppers in that they like to make multiple stops during outings, Savaryn says.

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“I keep telling everyone in our neighborhood to plant grapes,” she says. “That will change the dynamics of the town. We can create our own little micro-winery industry.”

Her winery is about 30 miles west of the Twin Cities, putting it in a rural setting close to a large base of potential customers. Two other wineries are located within a few miles of Sovereign Estate, which creates collective drawing power.

Like many wineries in the region, Sovereign Estate Wine includes rental facilities to host receptions and other events.

“We want to be a big player in the industry. This isn’t a hobby for us. We want to produce the best Marquette in Minnesota,” Savaryn says, referring to a relatively new and popular grape variety used to produce red wine. The grape variety is among several varieties developed at the U of M. Ron and Kim Wothe, owners of Glacial Ridge Winery in Spicer, were recently named the Minnesota Encore Entrepreneurs of the Year by the U.S. Small Business Administration. The award is for entrepreneurs older than 50 who have demonstrated success for at least three years.

Ron Wothe was 58 when he approached an SBA lending partner

|TOURISM| for help in establishing the first winery in the Glacial Lakes area. At Glacial Ridge, visitors can sample wines, listen to music outdoors on Thursday nights and book events such as catered receptions.

“They come for the wine and maybe go home with some wine and a shirt. We sell what we can,” says Ron Wothe, who previously worked in grocery management.

“Our special events probably drive this thing.”

The study on Minnesota by Tuck and Gartner reported that in 2011, grape growing and the winery industry contributed $59 million in economic activity to the state. Of that, $16.4 million was generated by vineyards, $22.1 million by wineries and $20.5 million by tourists.

Tuck and Gartner also wrote a report about vineyards and wineries in South Dakota and North Dakota. Because of the relatively small size of the industry in the two states, data from the Dakotas were combined into a single report issued in January 2014.

In 2011, the economic contribution of grape growing and the winery industries in the Dakotas was $26.4 million, according to the report. The total includes 665 jobs and $8.8 million in labor income. Vineyards contributed $880,000, wineries $11.6 million and tourists $13.9 million.

SD off to Good Start

10 full-time workers, at their two wineries. Since entering the business, they have employed 256 people, including a number of University of South Dakota students.

Growth of the industry in South Dakota has mirrored the pattern in other states, Nygaard says. “It starts off kind of slow, then takes hold. I would say in the last five years, we’ve doubled the amount of wineries in South Dakota,” he says.

In 2013, South Dakota surpassed the 100,000-gallon mark in wine production, according to Ty Eschenbaum, an agricultural development representative for the state Department of Agriculture. “It’s a new industry, a growing industry that is really taking off,” he says.

Bob Weyrich, past president of the South Dakota Winegrowers Association, jokes that wineries make a bettertasting product than the state’s other alcohol-making industry: ethanol. Weyrich formerly worked as an agricultural development specialist for the state and promoted specialty products, including grapes. Now he is employed by the Prairie Berry Winery in Hill City.

Growth in South Dakota has been dramatic and sustained, he says, but the industry remains still in its infancy.

Anne Fennell, a professor in the plant science department at South Dakota State University, is among the educators involved in national research projects on wine production. Growing grapes and other fruits for wine are

Some people call Eldon Nygaard the godfather of South Dakota’s modern wine industry. He started researching wine laws in 1995 and acquired the state’s first winery license in 1996.

Nygaard is a farmer and an attorney. He is also a former college professor and former state legislator. He and his wife, Sherry, operate the Valiant Vineyards Winery in Vermillion and Stone Faces Winery in Hill City.

Nygaard planted his original vineyard at his farm near Viborg in 1993 and then found out that South Dakota lacked enabling legislation for making wine. Laws and regulations have been enacted. But provisions for shipping wine out of the state remain cumbersome, Nygaard says.

The Nygaards currently employ 43 people, including

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Tucker's Walk Vineyard, near Garretson, S.D., grows cold-hardy grape varieties and also produces other fruit wines.

PHOTO: SOUTH DAKOTA DEPARTMENT OF TOURISM

“thinking persons’ crops,” she says. In addition to combating factors such as weather conditions, producers have to plan years in advance. Vines have to grow for several years before they produce grapes capable of tasting good and bringing return on investment.

Fennell likens wineries to farmers’ markets in the way they can positively affect the quality of life in an area. Repeat sales — a reflection of product quality — are crucial, she says.

Seven percent of the wine consumed in South Dakota is produced in the state, she says. “That is actually pretty good.”

Jim Hagen, South Dakota’s secretary of tourism, considers wineries a key sector of agri-tourism. “We’ve been promoting them for a few years,” he says. “It’s a great niche for us. It shows that South Dakota is more than Mount Rushmore or Crazy Horse or Deadwood and the Badlands.”

ND Poised for Growth Wine production is a relatively new industry in North Dakota, but it’s positioned for growth.

“It’s definitely a niche that we’re interested in helping to pro-

36

Prairie Business Magazine May 2014

mote. It’s a good fit with our other agriculture,” says Dean Ihla, tourism development manager in the tourism division of the North Dakota Department of Commerce.

A concentration of wineries is developing in the Fargo area, which officials say will lend itself well to group promotion.

Greg Krieger of Long Shadow Vineyards in Galesburg is the president of the North Dakota Grape and Wine Association. He’s also an agronomist. He does not operate a winery. His vineyards are more of a hobby than a business, he says. However, he is optimistic about the overall future of the wine industry in North Dakota.

“It’s very promising. Some of the flavors we can get in wines are just remarkable,” he says.

Greg Cook, who is building the 4 Elements Winery near Casselton, is also the chair and a professor in the chemistry department at North Dakota State University. “All of these things kind of start out as hobbies,” he says.

North Dakota is in the early stages of developing its wine industry, Cook says. He expects the state to have about a dozen

|TOURISM| wineries operating in another year.

“I think the Fargo area, by having five or six by 2015, will be more of a destination,” he says.

Harlene Hatterman-Valenti, assistant head and professor in the plant science department at NDSU, also says the state’s wine industry is steadily growing. “I think we’ve already made a good contribution, but I think it can get better,” she says.

Hatterman-Valenti likes that North Dakota, unlike states such as Iowa, requires wineries to primarily use fruits grown within the state. She’s also encouraged by law changes that have made distributing wine within the state easier. She says she’s impressed by the level of cooperation wine makers, winery operators and viticulturists demonstrate. “Their willingness to work together and help each other out is neat and ideal,” she says. PB Rob Swenson Contributing writer RobSwensonMediaServices@gmail.com

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|TALK OF THE TOWN|

Rapid City goes ‘big’ Black Hills hub readies for busy tourism season

BY KRIS BEVILL ay is considered “tourism month” in Rapid City, S.D. Many of the city’s businesses are in the final preparation phase for the high season and the city’s organizational groups, led by the Rapid City Area Convention and Visitor’s Bureau, are offering customer service training and encouraging business owners to educate staff members so that visitors will find welcoming faces and helpful guidance no matter where they turn.

“Tourism is huge in our part of the state,” says Linda Rabe, president and CEO of the Rapid City Area Chamber of Commerce. “When people think about coming to the Black Hills, they think about Rapid City.”

Of course, the Black Hills area encompasses other towns as well, and Rabe says the chamber’s approximately 1,200 member businesses include many in towns including Lead and Deadwood. But no matter which community they are based in, all are encouraged to do their best to help the approximately 3 million people who visit the region each year to have the experience of a lifetime while in the area. “We’re encouraging people to stop, take the time, thank them for being here and help get them where they need to go,” Rabe says.

Rapid City’s CVB has unveiled a new slogan — Do Big Things — that the group thinks pairs well with the “big” experiences visitors have at Mount Rushmore

M

Approximately 3 million people visit the Black Hills area of South Dakota every year, many of whom stay in Rapid City, S.D., while touring area attractions.

PHOTO: RAPID CITY CONVENTION AND VISITORS BUREAU

38

Prairie Business Magazine May 2014

and in the city. Most of the city’s big events are held in the recently revitalized downtown, which is itself an extremely successful big renovation project led by downtown business owners. Main Street Square in downtown hosts regular events, including a summer concert series and outdoor movie showings.

Other events held in Rapid City during the summer months draw thousands of visitors, including the Black Hills Fat Tire Festival and the Strider Bike U.S. Championships in June and, in July, the Hills Alive Music Festival, a Christian music gathering that attracts more than 40,000 over the course of a weekend.

Stacie Granum, director of marketing for the CVB, says most of the city’s businesses rely heavily on tourism and many make or break their year during the summer months. Fortunately, the last few years have been good for tourism. Hotel numbers were up about 5.5 percent last year over the previous year, and a survey taken of Mount Rushmore visitors determined that Mount Rushmore visitors spent $279 million within a 100-mile radius of the attraction in 2013, much of which was likely spent in Rapid City, as many of the monument’s visitors stay in the town.

“Last year we had a great tourism season — numbers were up — and this year, in talking with hotels and

|TALK OF THE TOWN|

The world has changed. <RXU ƃQDQFLDO DGYLFH

VKRXOG WRR

other area attractions, reservations are looking good and inquiries are coming in earlier than we have seen,” Granum says.

A number of new businesses have opened recently to further support the city’s tourism industry, including several restaurants, food shops and a winery known as Firehouse Wine Cellars. Other recently opened attractions include an exhibit featuring life-size models of the Declaration of Independence signers and the popular Museum of the American Bison.

Granum says that while downtown is definitely thriving, the northeast and south sides of the city are also growing, largely in response to tourism, and have positively impacted the local economy, sometimes through added businesses which may not immediately appear to have a tourism connection. Health care, for example, has expanded in Rapid City in response to increased needs during the tourism season, she says. Two urgent care clinics were added in the past year and another is scheduled to break ground this year.

Granum cautions that weather always impacts the tourism season, but for now, all signs point toward a successful season for business owners in Rapid City and throughout the Black Hills. “We’ve all had a tough winter,” she says. “People are just itching to get out there on vacation and travel, and just get out. I think that will help get people to the area.” PB

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39

|HEALTH CARE|

Todd Reynolds, chief technology officer, Evolution1

Tiffany Wirth, marketing director, Evolution1

Evolving with health care Tech company Evolution1 grows with demand for cloud-based services

BY KRIS BEVILL

uch attention has been given recently to the difficulties associated with implementing changes in business’ health care plans as they work to comply with new regulations.

But while the evolving world of health care has been a headache for many, it has also been a boon for health care-focused technology companies like Evolution1, a provider of electronic payment solutions for health care benefits plans such as flexible spending accounts and health savings accounts.

Launched in 2011 as the result of a merger between Fargo-based Lighthouse1 and East Coastbased Evolutions Benefits Inc., privately owned Evolution1 is focused on “simplifying the business of health care” through the use of cloud-based technology services. Through its 500 partners, including Sanford Health Plan and Alliance Benefit Group North Central States Inc., the company provides customers with the technology needed to track and reimburse health care-related expenses without requiring them to update software or perform any of the back-end work, says Todd Reynolds, chief technology officer.

“We move millions and millions of dollars every day and we process thousands of transactions every second,” he says. “All they have to worry about is: ‘Which device am I going to use today to manage my health care expenses?’”

M

Evolution1 provides electronic payment solutions for health care benefits plans.

PHOTO: SCOTT THUNE

40

Prairie Business Magazine May 2014

Last year, Evolution1 processed 66 million claims for the more than 90,000 employers and 10 million consumers served by its platform. The company increased the number of consumers it served in 2013 by more than 30 percent over the previous year and those numbers are expected to grow again this year as changing regulations continue to require health plan providers to update and reform the way they offer health care accounts to their employees.

As business has steadily grown for Evolution1 since 2011, so has the company. Eighty employees have been added in the last three years, bringing the company’s current number of employees to about 310 people throughout its four locations in Fargo, Minneapolis, St. Louis, Mo., and Hartford, Conn. Tiffany Wirth, Evolution1’s marketing director, says the company has not named an official headquarters, but its corporate headquarters is in Fargo, as are about 140 of its employees. Nearly half of the company’s research and development team also works in the Fargo office.

More employees will be added in 2014 as the company continues to ramp up its capabilities to meet demand. In early April, Evolution1’s website listed nearly 30 job openings for various positions throughout its locations. Reynolds says he anticipates adding 20 to 25 new jobs in Fargo, about half of which will be in research and development. “The more things change, (continued on page 42)

www.eapc.net

www.prairiebizmag.com

41

|HEALTH CARE| (continued from page 40)

the more we have to change with it, but the more people need us,” he says. “We’ve been fortunate enough to be able to adapt pretty quickly — sometimes in days and weeks — to some of the regulatory changes that happen and that just makes for more business.”

In the immediate future, he says Evolution1 will continue to expand its platform’s mobile capabilities and continue developing methods to integrate it with various health care exchanges.

“Those are probably the two places that we will put our R&D dollars in over the course of the next 12 months,” he says.

The company is also putting effort into educating its partners and clients on the changing health care climate through an informational website launched last fall. Healthcare Trends Institute (HealthcareTrendsInstitute.org) was created in response to inquiries from employers and partners seeking a source for up-to-date information, according to Wirth. The website provides information on current general interest health care topics through staff-written blogs, studies, webcasts and other resources. “It has really allowed us to simplify the information that is out there and get in the hands of the people who really need to know,” she says. About 1,000 people currently receive information via the institute’s e-newsletter.

As the market for health care benefits services continues to heat up, Evolution1 is confident it has cemented its role as an industry leader.

There are only a handful of competitors, and even those competitors offer slightly differing services.

Evolution1’s niche is in using a partner model for distribution so that it doesn’t have to directly sell its services to clients.

In a statement released March 24 highlighting its significant growth throughout 2013, CEO Jeff Young gave much of the credit to Evolution1’s partner companies. “The success that we are experiencing is a direct result of the success our partners are having,” he said. “The health care benefits market is both incredibly dynamic and filled with opportunity, and we will continue to invest, partner and innovate to ensure that our partners are in the best position possible to win in the marketplace.” PB

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Prairie Business Magazine May 2014

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Keeping the Bakken working Sanford Health goes mobile to meet oil patch’s medical needs

BY KRIS BEVILL ot much can slow the nonstop, 24-7 pace of energy production in the Bakken. Except medical needs. Many Bakken-related jobs require preemployment testing — from drug and alcohol testing to physical exams — and the physical nature of many oil patch professions makes medical care availability an important part of Bakken working. Unfortunately, the rapid influx of new residents into the region over the past few years has made keeping up with the industry’s medical needs a struggle, but an initiative being rolled out soon by Sanford Health aims to catch up with the need by taking medical care to the companies where they need it.

O.P.C. (oil-producing companies) mobileMED will consist of two mobile clinics and one modular clinic dedicated to serving oil companies and their subsidiaries in the Bakken. The mobile units are expected to be complete and ready to unveil dur-

N

Sanford Health’s O.P.C. (oil-producing companies) mobile MED units will provide work-related and nonwork-related medical services for workers in the Bakken region. IMAGE: SANFORD HEALTH

46

Prairie Business Magazine May 2014

|ENERGY|

ing the Williston Basin Petroleum Conference, to be held May 20-22 in Bismarck, N.D. The clinics-on-wheels will then hit the road in June, delivering health care services to industry workers in the oil patch as needed.

Stephanie Murdock, Sanford enterprise vice president of corporate occupational medicine services, says that while mobile clinics are not a new approach for providing medical services on the rural northern Plains, Sanford believes it is taking an innovative approach to the method by incorporating telemedicine into the list of comprehensive services offered.

The units are also unique in that their primary focus is to “keep the Bakken working” by providing the necessary pre-employment medical services and on-the-job medical care needed by oilfield workers, according to Murdock. “There is just such a huge population growth of workforce that has specific needs,” she says. “They need these types of services just to even start a job, so when there’s any kind of delay or gap in those services they’re not able to get on the job quickly.”

In early April, Sanford was still conversing with industry members to identify specific sites for the mobile clinics. Murdock says Sanford has relationships with about 6,000 companies in its western region, including oil industry companies that utilize its clinics in Bismarck, Minot and Dickinson, N.D. Some companies have contacted Sanford to request its mobile unit services and Sanford was also requesting feedback from industry stakeholders to help identify the best locations for service. “We know the need is there,” Murdock says. “Now it’s just to make sure we’re in the right place.”

Watford City was identified early on as a location in need of the specialized services. In fact, because of the hub city’s concentration of oilfield workers and companies, Sanford plans to establish a

2,000-square-foot modular unit on land leased from McKenzie County. The modular unit will not be complete until later this fall, so one of the two mobile units will be used in the meantime. Once the modular clinic is complete, Murdock expects it will remain in use indefinitely. “Because this has such a very specific focus — the oil workers and subsidiaries — we anticipate the modular unit will be there for some time,” she says.

Sanford’s Minot clinic will likely serve as home base for the second mobile unit because it can be easily dispatched to areas northwest of the city, but industry needs will dictate specific sites, according to Murdock.

According to Sanford, the mobileMED unit initiative requires an initial investment of nearly $3 million. Once up and running, the organization anticipates annual operating costs to approach $5 million. Sanford will foot the bill for the entire cost of the initiative, which Murdock says will provide a much-needed solution to the region’s health care demands. And while the mobile units will be dedicated to the energy industry’s needs, Sanford expects those units to lessen the patient load at existing brick-and-mortar clinics, making services at those facilities more readily accessible for nonoilfield patients and thus improving health care for the region overall.

“When Sanford came into western North Dakota we made a commitment to the region to be able to bring health care,” Murdock says.

“We figure that with this one initiative, Sanford is in a good position to help provide some immediate assistance. We’ll be able to provide just about anything a worker in this region will need, work related or nonwork related, to keep them healthy and at work.” PB Kris Bevill Editor, Prairie Business 701-306-8561, kbevill@prairiebizmag.com

www.prairiebizmag.com

47

|FEDERAL DRILLING DATA|

Legacy oil production change thousand barrels/day Bakken

Eagle Ford

Haynesville

Marcellus

Niobrara

Permian

0 (25) (50) (75) (100)

May-2013

(125)

May-2014

Indicated monthly change in oil production (May vs. Apr)

Indicated monthly change in gas production (May vs. Apr)

thousand barrels/day

million cubic feet/day

May-2013

May-2013

May-2014

May-2014

1,000

70

800

60 50

600

40 400

30

-

20

200

10

0

0

-200

-10 Bakken

Eagle Ford

Haynesville

Marcellus

Niobrara

Bakken

Permian

Eagle Ford Haynesville

Marcellus

Niobrara

Permian

Niobrara

Permian

Natural gas production

Oil production

million cubic feet/day

thousand barrels/day

May-2013

May-2013

May-2014

May-2014

16,000

2,400

14,000

2,000

12,000

1,600

10,000 8,000

1,200

6,000

800

4,000

400

2,000

0

0 Bakken

48

Eagle Ford

Haynesville

Prairie Business Magazine May 2014

Marcellus

Niobrara

Permian

Bakken

Eagle Ford Haynesville

Marcellus

SOURCE: U.S. DOE ENERGY INFORMATION ADMINISTRATION

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Prairie Business Magazine May 2014

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|BY THE NUMBERS|

| SPONSORED BY

|

Oil Producing

Average Daily

Wells

Jan. '14

+1,758

Jan. '13

10,100* 8,342

Jan. '14

+185,341

Jan. '13

*All time monthly high.

-13.79

Jan. '13

737,787

-28

Jan. '13

253 281

All time monthly high:

976,453, Nov. 13

370, Oct. 2012

Jan. '14

+216,542

Jan. '13

1,008,346 791,804

Count

Jan. '14

+3

Jan. '13

188 185

All time monthly high: 218, May 2012

Coal

Gas

(MCF/day)

$74.20 $87.99

Jan. '14

923,128

Gas Jan. '14

Permits

All time monthly high:

Price per barrel

Average Rig

Total

Production (barrels)

(% Flared)

Jan. '14

+5.6

Jan. '13

36% 30.4%

(Thousand Short Tons)

Jan. '14

+55

Jan. '13

2,558 2,503

All time monthly high:

All time monthly high:

All time monthly high:

All time monthly high:

$136.29, July 2008

1,085,256, Nov. 13

36%, Sept. 2011

2,924, March 2004 *EIA Original Estimate data (data since 2002)

Interest Rates

Employment

7

Effective federal funds rate 10-year treasury constant maturity rate

6

Percent

5 4 3 2 1 0

Jan2000

Jan2002

Jan2005

Jan2007

Jan2010

Gas Captured/Sold

18%

Jan2012

Jan2015

UNEMPLOYMENT RATE Jan.-14 Jan.-13

EMPLOYMENT Jan.-14 Jan.-13

North Dakota

2.60%

3.00%

393,320

Bismarck MSA

3.4

4.1

59,904

57,453

Fargo MSA

3.6

4.7

115,846

113,219

Grand Forks MSA

4.3

5.2

51,849

50,982

Dickinson MiSA

1.7

2.1

21,438

20,671

Jamestown MiSA

3.3

4.8

10,690

9,811

Minot MiSA

3.6

4.3

34,762

34,529

Wahpeton MiSA

4.0

5.5

11,445

10,974

Williston MiSA

1.0

1.0

35,783

38,889

South Dakota

3.60%

4.00%

433,912

429,709

Rapid City MSA

4.2

5.1

62,516

61,299

Sioux Falls MSA

3.7

4.4

128,176

125,709

Aberdeen MiSA

3.5

4.0

22,339

21,876

Brookings MiSA

3.3

3.9

18,011

17,674

Huron MiSA

3.9

4.7

9,389

9,422

Mitchell MiSA

3.5

4.3

12,935

12,523

Pierre MiSA

3.2

3.5

11,608

11,632

Spearfish MiSA

4.0

5.0

12,038

11,820

Vermillion MiSA

3.5

4.2

7,039

7,371

Watertown MiSA

4.2

4.9

18,227

18,043

Yankton MiSA

3.7

4.4

11,199

11,110

Minnesota

4.70%

5.30%

2,843,982

2,817,187

Duluth MSA

6.9

8.0

134,468

131,783

Minneapolis-St. Paul MSA

5.1

6.0

1,771,987

1,749,650

Alexandria MiSA

5.1

6.1

19,590

19,421

Bemidji MiSA

7.9

8.9

20,671

20,181

Brainerd MiSA

9.2

10.6

41,436

39,999

Fairmont MiSA

6.0

6.5

9,838

10,252

Fergus Falls MiSA

6.9

8.1

28,232

27,749

Hutchinson MiSA

6.6

8.4

18,256

17,581

Marshall MiSA

5.4

6.0

14,051

13,943

Flared due to challenges or constraints on existing gathering systems

Red Wing MiSA

5.7

6.5

24,179

23,213

Willmar MiSA

6.1

6.7

23,201

22,357

Flared due to lack of pipeline connection

Winona MiSA

5.2

5.8

27,479

27,671

Worthington MiSA

4.7

5.2

10,822

10,887

17% 65%

Gas captured and sold

SOURCE: N.D. PIPELINE AUTHORITY

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

52

386,406

Prairie Business Magazine May 2014

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