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Business resource of the northern plains
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July 2013
www.prairiebizmag.com
Evolving for the Next Era Noridian changes name, launches massive hiring
plan to meet growing health care services demandpg. 22
ALSOTech Boosters
Investors, state offer support for emerging technology sector
pg. 20
How High for How Long?Soaring cropland prices
continue to impact regionpg. 26
110 n. broadway • downtown fargo701.365.0900
1803 s. washington • grand forks701.757.2444
www.scandesignnd.comLocally Owned & Operated
scandesign
North Dakota. Doing Business Better. Aldevron is one of many biotech companies taking root in North Dakota thanksto the state’s world-class academic resources and favorable economic climate.Learn how the North Dakota Department of Commerce and companies in thestate are doing business better at www.NDBusiness.com
Photo courtesy of Aldevron
4 Prairie Business Magazine July 2013
|INSIDE|July 2013 VOL 14 ISSUE 7
FEATURES DEPARTMENTS6 Editor’s Note
BY KRIS BEVILL
A day in the life
8 Business Advice BY MATTHEW D. MOHR
Reinvest to build
10 FinanceBY RICK CLAYBURGH
New law impacts flood insurance policies
12 Research & Technology BY PHILIP BOUDJOUK
Bridging the other ‘valley of death’ —from lab to market
14 Economic Development BY DEAN REESE
Development Fund a valuable tool for ND businesses
16 Prairie News
20 Prairie People
22 Business DevelopmentND investors foster growing tech sector
30 South DakotaNo-pedal bike company hits its stride
32 Western North DakotaExperiencing the Bakken
34 Red River ValleyNonprofit sets example for effective, multi-source funding
35 Business to Business
36 Energy
40 By the Numbers
Next MonthThe August issue of Prairie Businessmagazine will highlight business-higher education partnerships and ask if the private investments are worthwhile. Other articles will include an update on the state of manufacturing in the region, South Dakota's efforts to make the most of North Dakota's oil boom, and a teacher internship program designed to provide hands-on experience in various industries.
Tom McGraw, president and CEO, Noridian Healthcare Solutions PHOTO: JOHN BROSE
24 Health CareBuilding on a History of ExpertiseNoridian changes name, launches massive hiring plan to meet growing health care services demand
Land ValuesHow High Will They Go?Strong commodity prices and low interest ratescontinue to impact region’s land prices
28
Scan this with your smartphone'sQR Reader to visit our website.
Follow us on Twitterhttps://twitter.com/PrairieBiz
Check us out on Facebookhttps://www.facebook.com/PrairieBusiness
6 Prairie Business Magazine July 2013
|EDITOR’S NOTE|
A day in the life
So there I was, riding in a van southbound on Highway 85 through the heart of North
Dakota’s oil country, having a discussion with a news crew from France about whether
traffic in Paris is worse than traffic in western North Dakota.
No, this is not a joke. It was an actual conversation I had with two other attendees of a recent
Bakken Field Tour, hosted by Williston, N.D.-based Dawa Solutions Group. (The French crew said
Paris traffic is much scarier, although they forgot to consider that the city’s population outnumbers
the entire state of North Dakota by more than 2 million.) For a few hundred dollars, the tour offers
anyone with an interest in the Bakken region the chance to learn about oil’s history in the area, the
current technology-based play and the economic development associated with it, as well as an after-
noon driving tour of the impacted area. The wealth of comprehensive information delivered
throughout the day is helpful, but the observations made on the driving tour can be downright fas-
cinating. For more on the tour, read “Experiencing the Bakken," on page 30.
This issue also looks into the high prices being paid for cropland throughout our region.
Contributing writer Kylie Blanchard talked to several economists to learn more about where the
highest-priced land is located, why it’s commanding such a high price and how long those prices
are expected to remain. See “How High Will They Go?” on page 26 to read what she found out.
We also offer a profile of Noridian Healthcare Solutions, formerly Noridian Administrative
Services. The company is in the midst of a major hiring spree as it prepares to carry out a massive
five-year Medicare contract and will add nearly 400 new jobs in North Dakota by September. The
company is also on the forefront of creating healthcare exchanges, which will be used to implement
the Affordable Care Act. Tom McGraw, who joined the company in October as the second CEO and
president in Noridian’s history, shares his take on hiring in a state with historically low unemploy-
ment, and how his company is evolving to address complex changes in the health care industry in
“Building on a History of Expertise," on page 22.
Finally, I want to bring to your attention that we are now accepting nominations for this
year’s 40 under 40 list. Many of you have emailed or called me throughout the year to request sub-
mission details so I know that this year’s pool of candidates is going to be stronger than ever. We
are excited to receive your nominations and look forward to sharing the results in our December
issue. Visit our website – www.prairiebizmag.com – to submit your nominations.
KRIS [email protected]
7www.prairiebizmag.com
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Answers you can trust - From people who care
800-323-7583 www.dacotahpaper.com
PrairiePrairie
northern plains business resource
BusinessMIKE JACOBS, PublisherRONA JOHNSON, Executive EditorKRIS BEVILL, EditorBETH BOHLMAN, Circulation ManagerKRIS WOLFF, Layout Design, Ad Design
Sales Director:JOHN FETSCH701.212.1026 [email protected]
Sales:BRAD BOYD - western ND/western SD800.641.0683 [email protected]
SHELLY LARSON - eastern ND/western MN701.866.3628 [email protected]
Editor:KRIS BEVILL701.306.8561 [email protected]
Editorial Advisors:Dwaine Chapel, Executive Director, ResearchPark at South Dakota State University; BruceGjovig, Director, Center for Innovation; LisaGulland-Nelson, Vice President, Marketing andP.R., Greater Fargo Moorhead EDC; Tonya Joe(T.J.) Hansen, Assistant Professor of Economics,Minnesota State University Moorhead; DustyJohnson, Chief of Staff for South Dakota Gov.Dennis Daugaard’s office; Brekka Kramer,General Manager of Odney; Matthew Mohr,President/CEO, Dacotah Paper Company; NancyStraw, President, West Central Initiative
Prairie Business magazine is published monthlyby the Grand Forks Herald and ForumCommunications Company with offices at 3752nd Avenue North, Grand Forks, ND 58203.Qualifying subscriptions are available free ofcharge. Back issue quantities are limited andsubject to availability ($2/copy prepaid). Theopinions of writers featured in Prairie Business aretheir own. Unsolicited manuscripts, photo-graphs, artwork are encouraged but will not bereturned without a self-addressed, stampedenvelope.
Subscriptions Free subscriptions are availableonline to qualified requestors at www.prairiebizmag.com
Address corrections Prairie BusinessmagazinePO Box 6008Grand Forks, ND 58206-6008Beth Bohlman: [email protected]
Online www.prairiebizmag.com
8 Prairie Business Magazine July 2013
|BUSINESS ADVICE|
Reinvest to buildBY MATTHEW D. MOHR
Few businesses can continually grow and prosper
without the reinvestment of profits or acquiring
new capital. Reinvesting in a business is like com-
pounding interest. As you earn income, your reinvest-
ment of this income gives you a larger base to grow from.
When considering the successful entrepreneurs
throughout our region, most of them kept the bulk, if not
all, of their wealth tied up in one main enterprise. Some
ventured into other businesses, and some extended their
wealth through investing in stocks, bonds and real estate.
Most took the profits earned and put them back to work
inside their primary business.
Great farmers learned the rule of reinvestment
decades ago, and as a result many have created enormous
wealth over generations. A superior crop year gave cash
for more land and upgraded equipment. As reinvest-
ments of farm profits continue, large super-profitable
enterprises are the result. But agribusiness owners are
not the only ones who have experienced success through
capital reinvestment.
Bell State Bank is a fine example of an enterprise
which has grown continually through dedicated reinvest-
ment of profits. Bell State is now one of the region’s pre-
mier banking institutions. Not long ago it was a smaller
depositor focused bank, but with each successive year the
ownership added new locations and bought similar area
banks.
By reinvesting profits and adding new capital through
the bank stockholder-owners when it could, Bell State has
become a premier banking institution of great size.
Through this constant and relentless pursuit of banking
excellence Bell State has grown to be a regional power and
a leader in our region’s banking community. PB
Matthew D. MohrCEO, Dacotah Paper Co.
9www.prairiebizmag.com
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10 Prairie Business Magazine July 2013
|FINANCE|
New law impacts flood insurance policies BY RICK CLAYBURGH
With the record spring rainfall here in the
Dakotas, it is important to be aware of
recently passed federal legislation that is
expected to have a big impact on flood insurance. The
Biggert-Waters Flood Insurance Reform Act of 2012 was
signed into law July 6, 2012. In addition to reauthoriz-
ing the National Flood Insurance Program through
Sept. 30, 2017, the bill brings several substantive changes
to the program, including several that alter the way pre-
mium rates are calculated.
The law requires that increased flood insurance pre-
miums be phased in and existing premium subsidies be
phased out. As a result, property owners in “Special Flood
Hazard Areas” may see more expensive insurance rates —
in some cases significantly more — than what they are
currently paying. The new premiums will reflect the true
flood risk of homes and businesses. Premiums have the
potential to increase by as much as 25 percent per year for
the next four years until full-risk rates are reached.
It is important that property owners repairing and
rebuilding structures after storms understand these
changes so they can make sound and informed decisions
about whether they want to place additional resources in
an impacted area, and so they can understand the finan-
cial implications of doing so. These include not only ques-
tions of rebuilding destroyed homes but repairing them,
too. For example, should I replace a damaged water-heater
in my basement or should I consider moving it upstairs?
Flood insurance premiums are calculated based on
Federal Emergency Management Agency maps and the
minimum building requirements for that region. An
owner whose home or business is built in compliance with
those minimum building requirements, or exceeds those
standards, will be at an advantage. Their premiums may
still go up but will be lower than those for homes that do
not meet the minimum requirements. If you’re rebuilding
after a flood, it is important to consult FEMA maps prior
to construction. Building in compliance with base flood
elevation standards could protect your financial future.
Here are four things to expect from the Biggert-
Waters Flood Insurance Reform Act:
1) Automatic increases: Policy rates for primary
residences are automatically subject to increases if there
has been change in ownership, a lapse in coverage, a
change in flood risk according to new FEMA flood maps,
or substantial damage or improvement to a building.
2) Diminishing discounts: Existing subsidies for
second homes, rental homes, businesses or repetitive loss
properties are eliminated. “Grandfather” clauses will also
be eliminated, meaning all rates will be based on the build-
ing’s compliance with current flood zone recommenda-
tions, not the standards when the building was first built.
3) Updated flood zone maps: FEMA is redrawing
flood zone maps across the country. That means buildings
that weren’t in a flood zone before might be in one now,
or in a higher-risk zone. These zones determine minimum
building requirements and whether you meet these mini-
mums determines what your insurance will cost.
4) Higher annual increases: In the past, annual
premium increases were limited to 10 percent; that limit is
now 20 percent.
FEMA offers three programs to reduce your risk
and help you save money on flood insurance. To see
if you qualify, visit www.fema.gov. For more details
on the Biggert-Waters Flood Insurance Reform Act,
visit www.nhma.info/nhma-biggert-article/ or call
the National Flood Insurance Program Help Center
at 1-800-427-4661.
You can also visit the following FEMA websites for
more information:
www.ready.gov/floods;
www.fema.gov/region-vi/national-flood-insurance-
program-reform-frequently-asked-questions; or
www.floodsmart.gov/floodsmart/pdfs/fema_flood_
brochure.pdf. PBRick Clayburgh
President and CEONorth Dakota Bankers Association
11www.prairiebizmag.com
northern plains business resource
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12 Prairie Business Magazine July 2013
|RESEARCH & TECHNOLOGY|
Bridging the other ‘valley of death’— from lab to marketBY PHILIP BOUDJOUK
For companies and researchers, bringing a
technology to market can be a daunting chal-
lenge. The first “valley of death” in business
often refers to capital that entrepreneurs need for
startups. An equally important “valley of death” cen-
ters on taking technology from the lab into mar-
ketable product blockbusters.
For companies with lean research budgets, uni-
versities continue to play a vital role in R&D world-
wide. Whether licensing a North Dakota State
University-developed technology to bring to the
marketplace, or assisting companies in solving chal-
lenges to bring their own products to customers,
NDSU has a strong track record for transferring tech-
nology from the university lab to the marketplace.
From FY 2007 to FY 2011, NDSU generated 256
invention disclosures, filed 142 new U.S. patent appli-
cations and produced 486 licenses. By FY 2012, NDSU
licensing revenues topped $2 million, growing more
than 77 percent since FY 2006.
On average, NDSU processes one federal grant
award daily and a research contract with the private
sector every week. Cumulatively, NDSU has executed
nearly 300 private sector research contracts over the
past five years.
NDSU-developed technologies that are moving
toward the marketplace include an anti-corrosion
primer for aircraft which was licensed to the world’s
largest coatings company, miniaturized ground sen-
sors developed for the military and deployed on three
continents to protect military assets, biodefensive coat-
ings in development with a North Dakota company,
and RFID (radio-frequency identification) tagging
systems for military equipment. Other NDSU-devel-
oped technology has been licensed to startup compa-
nies, including removable coatings for bronze sculp-
tures and architectural components, biocomposites
from renewable crop materials and a vertical data min-
ing algorithm and software.
The North Dakota Economic Development
Centers of Excellence program provides a mechanism
to promote technology-based economic development.
Public/private R&D partnerships at NDSU include
technologies such as anti-fouling coatings for ships,
biomedical devices such as hearing aids, microelec-
tronics for unmanned aerial systems, mobile phone
technologies, new optical materials, and anti-icing and
anti-soiling coatings for composite materials and wind
turbine blades.
Developing new technologies and helping com-
panies solve technology challenges forges partner-
ships that lead to technology-led economic develop-
ment. NDSU students are also provided unique
opportunities to work alongside NDSU researchers,
established global companies and startups to develop
new technologies and products for real-world appli-
cations. Students are frequently co-inventors on
patent applications.
By fall 2013, NDSU’s efforts to transfer technol-
ogy from lab bench to market will get a boost from a
35,000-square-foot addition of scientific lab space to
an existing building in the NDSU Research and
Technology Park. Research objectives include R&D
and commercialization of top NDSU-developed
technologies via private sector partnerships.
The $9 million addition was funded the by U.S.
Department of Commerce/National Institute of
Standards and Technology and a North Dakota
Centers of Excellence Enhancement Program grant
approved in 2009.
The R&D partnership between NDSU and
companies enhances business success and econom-
ic development. It also means research opportuni-
ties for students, leading to a highly skilled work-
force for the region. The results are compelling. The
opportunities are wide open. All of these compo-
nents represent a bright economic future. PB
Philip BoudjoukVice president for research, creative
activities and technology transferNorth Dakota State University
[email protected]: @NDSU
13www.prairiebizmag.com
jlgarchitects.com
North Dakota is booming – bringing the opportunity to build a financially-sound state for generations to come. As one of the oldest and largest financial companies in the region, Alerus saw a record 66.9% rise in net income and an unprecedented 63.5% increase in share earnings in 2012, meaning more jobs, more available loans, and more assets for North Dakotans. Now that’s a bank you can count on.
14 Prairie Business Magazine July 2013
|ECONOMIC DEVELOPMENT|
Development Fund a valuable tool for ND businessesBY DEAN REESE
The North Dakota Development Fund is a
valuable financing tool for North Dakota
businesses, providing a strong return on
investment for taxpayers and contributing signifi-
cantly to job creation. As we continue to grow our
economy in the state and create economic opportuni-
ties for our citizens, it is important that financing
support is available for startup or expansion projects
in North Dakota.
The North Dakota Development Fund was creat-
ed through legislation in 1991 as an economic develop-
ment tool. It provides flexible gap financing through
debt and equity investments for new or expanding
North Dakota primary sector businesses.
The Development Fund makes investments of up
to $300,000 in primary sector businesses. The North
Dakota Development Fund Board may adjust the limit
when deemed appropriate.
In general, the following criteria apply to
Development Fund investments:
• The entrepreneur must have a realistic financial
commitment at stake. Usually principals are required to
have a minimum of 15 percent equity in the project.
• Refinancing of debt is not eligible.
• Principal shareholders with 20 percent or greater
ownership are generally required to guarantee the debt.
Other shareholders may also be required to guarantee.
• The Development Fund will not participate in
more than 50 percent of a project’s capitalization needs.
• Financing is available to any primary sector
business project with the exception of production
agriculture.
• Primary sector includes individuals and busi-
nesses which, through the employment of knowledge
or labor, add value to a product, process or service
which results in the creation of new wealth. Primary
sector includes tourism and specific types of investor-
owned agriculture, and is typically businesses such as
manufacturers, food processors or export service com-
panies. Investor-owned agriculture includes livestock
feeding or milking operations, or other value-added
agriculture located apart from an individual farm oper-
ation that is professionally managed and has employees.
Since the launch of the Development Fund, it has
invested $97 million in 519 companies with over $30.8
million invested in rural communities. The investments
made by the Development Fund have contributed to
the projected creation of 10,389 primary sector jobs.
Economic activity continues to be strong in North
Dakota. In providing flexible financing, the
Development Fund will continue to assist primary sec-
tor businesses start-up or expand, which will help to
create additional jobs and new revenues for the state of
North Dakota.
Loan and equity programs managed by the North
Dakota Development Fund include:
• North Dakota Development Fund
• Regional Rural Revolving Loan Fund
• Rural Incentive Growth Loan Program
• Small Business Technology Program
• Child Care Loan Program
• New Venture Capital Program
• Entrepreneur Loan Program
• Entrepreneurial Center Loan Program
For some additional information visit:
www.NDDevelopmentFund.com. PB
Dean ReeseDirector, North Dakota Development Fund
15www.prairiebizmag.com
16 Prairie Business Magazine July 2013
Prairie News Industry News & Trends
Cooperstown manufacturer receives SBA award
Posi Lock Puller Inc., a manufacturer of gear and
bearing pullers based in Cooperstown, N.D., recently
received the 2013 North Dakota Small Business Exporter
of the Year award from the U.S. Small Business
Administration. The company was selected following a
statewide competition and received the award in honor of
its successful export program. Posi Lock’s pullers are
shipped to every country in the world, according to the
SBA, but all of its products are made in the U.S., with most
of the outsourcing needs handled within a 200-mile
radius of Cooperstown.
The family-run company was founded 35 years ago
with the introduction of a patented gear and bearing
puller invented by Dean Somerville for use in industrial,
agriculture and automotive markets.From left: Cris Somerville; Peggy Somerville; Stacy Somerville; Dean Somerville; Tamara Somerville; Alan Haut, SBA lender relations specialist; Carlos Sosa, SBA Office of International Trade regional managerPHOTO: U.S. SMALL BUSINESS ADMINISTRATION
Silicon Plains acquiresAcoustic Visions Multimedia
Silicon Plains LLC, a Bismarck, N.D.-based
business computer support services firm, has
agreed to acquire Acoustic Visions Multimedia, a
web hosting and business computer support com-
pany based in Mandan, N.D.
AVM customers will be transitioned to Silicon
Plains over the next several months. “Moving this
large of a customer base over to our company is a
process we take very seriously,” Dan Polk, Silicon
Plains president, said in a news release. “Our goal is
to ensure no service interruptions occur.”
Steve Barreth, owner of AVM, will remain as a
consultant for Silicon Plains for an extended period
of time and will continue providing service to for-
mer AVM customers, according to the company.
Wells Fargo to relocateDickinson branch
Wells Fargo has announced plans to move its
Dickinson, N.D., banking store from the Prairie
Hills Mall to the West Ridge Center development
sometime this fall. Dickinson-based Tooz
Construction Inc. will build the new store, which
will offer safe deposit boxes and a multi-lane
drive-up with two car-accessible ATMs. While the
new location will open this fall, Wells Fargo also
plans to maintain its existing drive-up and ATM at
the Prairie Hills Mall through fall 2014.
“We’re excited to have the opportunity to
move into a brand new store in an up-and-com-
ing development,” says Travis Hande, market pres-
ident and ag industry specialist for Wells Fargo in
Dickinson. “The new location will be more invit-
ing to customers and will better fit our needs.”
Metro Plains acquires SD company
Metro Plains Management recently acquired
South Dakota-based PRO/Rental Management,
the company announced this week. PRO/Rental
Management has 45 apartment communities with
850 units and 40 employees.
The deal increases MetroPlains’ holdings to
160 apartment communities with 5,000 units and
230 employees, according to the company.
Founded in 1983 and headquartered in
Devils Lake, N.D., Metro Plains Management has
rental properties and commercial space in North
Dakota, Minnesota, South Dakota, Kansas and
Oklahoma.
CoBank commits $250K to NDSU
CoBank, a cooperative bank serving agribusi-
ness, rural infrastructure and Farm Credit System
associations throughout the U.S., will contribute
$250,000 to North Dakota State University in Fargo
over the next five years. Half of the funds will be
used to support the Quentin Burdick Center for
Cooperatives. The remaining funds will support the
NDSU Department of Agribusiness and Applied
Economics commodity trading room laboratory.
Aberdeen retail study examinesconsumers, opportunities
A coalition of Aberdeen, S.D., groups recent-
ly teamed up to back a study conducted by the
Buxton Co. to identify the city’s core consumers
and better understand its retail sector in terms of
areas of surplus and under-served markets. The
city will use the research to assist local businesses
in making strategic merchandising and location
decisions.
“The information from this study will offer
new data on our customers, such as where they
shop and what they buy,” says Gail Ochs, president
of the Aberdeen Area Chamber of Commerce. “It
also indicates where there are unmet needs for
products and services, which is an opportunity to
capture dollars currently leaving our community.”
Walmart to hire 300 for Mandan store
Walmart recently announced plans to hire
approximately 300 people to work at the
Walmart Supercenter scheduled to open in
Mandan, N.D., this fall. In June, the retail giant
said it expected most of the new hires to begin
work that month in order to help prepare the
store for its grand opening.
17www.prairiebizmag.com
Kraus-Anderson to manage $12 million BSU project
Kraus-Anderson Construction Co. has been selected as con-
struction manager at risk for a $12 million addition and renovation
project at Bemidji State University in Bemidji, Minn. Construction is
scheduled to start in July 2014 and will include the renovation of
Memorial and Decker Halls, including an addition which will accom-
modate the relocation of the College of Business from Decker Hall to
Memorial Hall.
Grand Forks site selected for $1.5 billion fertilizer project
Northern Plains Nitrogen has announced plans to build and
operate a $1.5 billion nitrogen fertilizer plant facility near Grand
Forks, N.D. The group’s plans call for a 2,200 ton-per-day ammonia
plant plus urea and urea-ammonium-nitrate (UAN) production
facilities to be located on land adjacent to the Grand Forks waste-
water treatment plant. The company plans to use natural gas piped
from the Bakken region of western North Dakota as a feedstock and
could also use wastewater effluent from the water treatment plant as
its water supply.
The plant is expected to be complete and ready to provide fer-
tilizer to area farmers for the 2017 growing season. Approximately
2,000 workers will be employed during the peak construction period
of the project. Upon completion, the facility is expected to provide
135 full-time jobs.
|PRAIRIE NEWS|
18 Prairie Business Magazine February 2012
|PRAIRIE NEWS|
Community foundationslaunch joint effort to promote philanthropy
North Dakota’s five community foundations
have launched a cooperative effort known as
NDGives to promote philanthropy in the state.
Participants include the Fargo Moorhead Area
Foundation, Minot Area Community
Foundation, North Dakota Community
Foundation, Community Foundation of Grand
Forks East Grand Forks and Region and Devils
Lake Area Foundation.
Made possible by a $100,000 grant from the
Bush Foundation, the goal of the campaign is to
increase residents’ understanding of endowment
funds and to raise awareness of the North Dakota
Charitable Income Tax Credit.
According to the foundations, North Dakota
currently ranks 17th in the country for average
adjusted gross income per tax return, but is 48th
in the nation for average charitable contribution
per return.
Walmart to hire 300 forMandan, ND, store
Walmart recently announced plans to
hire approximately 300 people to work at the
Walmart Supercenter scheduled to open in
Mandan, N.D., this fall. In a news release issued in
early June, the retail giant said it expected most of
the new hires to begin work that month in order
to help prepare the store for its grand opening.
Medical providers implementhealth IT at rapid pace
The U.S. Department of Health & Human
Services announced in May it has already exceed-
ed its goal for 50 percent of doctor offices and 80
percent of eligible hospitals to implement elec-
tronic health records (EHRs) by the end of the
year. According to the agency, use of EHRs by doc-
tors has increased more 30 percent since 2008
while the use of EHRs in hospitals has skyrocket-
ed from just 9 percent in 2008 to more than 80
percent currently.
The Obama administration has encouraged
the use of EHRs in order to improve the efficiency
and quality of health care. Doctors, hospitals and
other providers that demonstrate meaningful use
of EHRs receive federal incentives.
Bobcat breaks ground on $20 million Bismarck facilityBobcat Company has begun work on a $20 million renovation and expansion project to create the Acceleration Center in
Bismarck, N.D. The project includes the expansion of an existing building as well as the development of a new test track and
indoor testing facility at the Northern Plains Commerce Centre. Construction is expected to be complete in 2014. Wahpeton,
N.D.-based Comstock Construction Inc. is serving as the contractor for the project.
The Acceleration Center will initially house 135 employees, focusing on innovating and advancing designs, testing, proto-
type engineering and the computer simulation of ideas and concepts. The center will also serve as an educational facility and will
be used to provide training and hands-on experience for Bobcat dealers and customers.
Bobcat Company’s Acceleration Center in Bismarck, N.D., is expected to be complete in 2014. IMAGE: BOBCAT COMPANY
19www.prairiebizmag.com
|PRAIRIE NEWS|
RealTruck.com recognized forrecord-breaking sales
Truck accessory e-commerce site
RealTruck.com recently received the Growing
Jamestown (N.D.) award from the
Jamestown/Stutsman Development Corp. in
recognition of the company’s strong sales growth
in 2012 and positive influence on the local econo-
my. RealTruck.com finished 2012 with a record-
breaking $17.5 million in sales and has continued
upward trajectory in 2013.
The company was founded in Spokane,
Wash., in 1998 and relocated to Jamestown in
2000. Other than utilizing JSDC’s New Jobs
Training Fund to grow its staff after initially open-
ing the Jamestown location, RealTruck.com has
financed its growth exclusively with its own prof-
its. The company currently employs more than 40
people at its offices in Jamestown and Fargo.
Summit Midstream starts upBakken oil, water gatheringsystem
Summit Midstream Partners LLC,
announced in May that it has commenced opera-
tions of the Polar Crude Oil and Water Gathering
System in Williams County, North Dakota. The
system is designed to gather 50,000 barrels of
Bakken crude per day and 25,000 barrels of water
per day from the Bakken and Three Forks forma-
tions. The system is comprised of approximately
50 miles of crude oil gathering pipeline and 35
miles of water gathering pipeline. Oil will be deliv-
ered to the COLT Hub Terminal in Epping under
long-term, fee-based gathering agreements.
Kodiak Oil & Gas Corp. is the anchor customer on
the system.
West Fargo manufacturer winsexport award
Roll-a-Ramp, a West Fargo-based manufac-
turer of portable aluminum wheelchair ramps,
recently received the “E” award for exports from
the U.S. Acting Secretary of Commerce during a
ceremony in Washington, D.C. The award is the
highest recognition given to U.S. exporters by the
commerce department. Honorees must be nomi-
nated through the commerce department’s
Grand Forks plans drone business park
Officials from Grand Forks, N.D., state
leaders and representatives of the unmanned
aircraft systems (UAS) industry came
together during the 2013 UAS Action
Summit in Grand Forks on May 30
to unveil plans to establish a
UAS-specific business and
technology park near
Grand Forks. The park, dubbed
Grand Sky, will be located west of Grand
Forks on the Air Force base. The project is a
collaborative effort among the state, the
county, the city, the Grand Forks Base
Realignment Committee, the
Grand Forks Region
Economic Development
Corp., the University of
North Dakota and
Northland Community
and Technical College.
Construction is expected to
begin in 2014, with space becoming
available for tenants in early 2015.
Northrop Grumman, maker of the Global
Hawk drone, has announced its intent to
become an anchor tenant of the park.
The Grand Sky announcement correlates with the state and
city’s desire to be selected by the Federal Aviation Administration
as one of six UAS test sites. At least 50 applicants are vying to
become one of the half-dozen sites. The FAA is expected to
choose site locations by the end of this year.
If built as proposed, the Grand Sky unmanned air-craft systems business park in Grand Forks, N.D., willencompass 1.2 million square feet of space at theGrand Forks Air Base.
20 Prairie Business Magazine July 2013
|PRAIRIE PEOPLE|
Kvalheim named BSE northwestregion utility sales manager
Brad Kvalheim has been named northwest
region utility sales manager for Border States Electric.
Kvalheim joined BSE in 1989 as an electron-
ic service technician in the company’s Fargo
location. In 1992, he became utility customer
service representative for the upper Midwest
including Minnesota, North Dakota and South
Dakota. In 1995, Kvalheim moved to Sioux Falls,
S.D., and became an account manager. In this
role he was integral in coordinating five utility
alliance agreements with multi-year commit-
ments. Most recently he was the branch manager
in Sioux Falls. In his new position, Kvalheim will
be located in the company’s Bismarck, N.D.,
location and cover Montana, North Dakota,
South Dakota and Wyoming.
Eide Bailly announces management change
David Stende, who has served as chief oper-
ating officer for Fargo, N.D.-based accounting
firm Eide Bailly for the past seven years, has
assumed the role of managing partner/CEO of the
firm. He is taking the place of Jerry Topp, who
served in that role for the past decade and plans to
continue working for the next few years, focusing
his efforts on growing Practicewise, an association
of noncompeting CPA firms, and on ensuring a
smooth transition for the firm.
Mike Astrup, partner-in-charge of the Fargo
office, is the firm’s new chief administrative offi-
cer and will be responsible for the internal func-
tions of the firm, including human resources,
training, finance, communications and informa-
tion technology.
James Lyons, partner-in-charge of the firm’s
Colorado offices, has been named strategic growth
officer and will be responsible for the firm’s special-
ty services.
Barb Aasen, partner-in-charge of the
Bismarck and Williston, N.D., offices, and Andrew
Spillum, partner-in-charge of the Phoenix, Ariz.,
office, have been named chief practice officers.
They will be responsible for overseeing the growth
and profitability of the firm’s 21 operating offices in
addition to leading their respective offices.
The change in management structure is part
of the firm’s overall goal to continue an aggressive
growth pattern over the next five years.
Lignite Energy Council chooses new CEO
Jason Bohrer, a Congressional chief of staff,
has been named president and CEO of the Lignite
Energy Council. He succeeds John Dwyer, who
announced his retirement after serving as the
group’s CEO for 32 years.
Bohrer has 15 years of experience in public
policy and stakeholder relations, serving most
recently as chief of staff to Rep. Raul Labrador, R-
Idaho, and as a legislative counsel to Sen. James
Risch, R-Idaho, on energy policy, transmission,
cyber security and regulated utilities.
Bohrer is a graduate of North Dakota State
University in Fargo and George Mason University
School of Law in northern Virginia. Bohrer will
begin serving as CEO of the council in mid-July
and will be based in Bismarck, N.D.
Ackerman-Estvold hires seniorwater resources engineer
Minot, N.D.-based Ackerman-Estvold
Engineering and Management Consulting Inc.
has hired Thomas Johnson as a senior water
resources engineer.
Johnson previously worked for URS Corp. in
New Mexico as a senior engineer specializing in
water resources. He holds a bachelor’s degree in
civil engineering from North Dakota State
University in Fargo and a master’s degree in civil
engineering from the University of Minnesota. He
is also classified as a certified floodplain manager
and is a Leadership in Energy and Environmental
Design accredited professional (LEED AP).
Basin Electric names new VP of human resources
Ellen Holt recently joined Basin Electric
Power Cooperative as vice president of human
resources. In this role, Holt will provide strategic
leadership and oversee the tactical implementation
of cooperative-wide employee-focused programs
and policies.
Holt served most recently as manager of
human resources at Logistics Health
Incorporated/United Health Group in La Crosse,
Wis., where she led the implementation and devel-
opment of the human resources function in areas
including recruitment, employee relations, and
training and development. Prior to that, she served
as the human resources director for Gunderson
Lutheran Medical Center in La Crosse.
Brad Kvalheim
Tom Johnson
Jason Bohrer
Ellen Holt
David Stende
21www.prairiebizmag.com
|PRAIRIE PEOPLE|
Westra namedCOO at HeggCompanies
Steven Westra has
been named chief operat-
ing officer of Hegg
Companies Inc., a Sioux
Falls, S.D.-based real estate
investment and develop-
ment company. Westra has served as CEO of Esprit
Memory Care LLC, a business affiliated with Hegg
Companies, since 2010 and will continue in that
role while taking on additional leadership respon-
sibilities to help manage HCI’s multi-faceted
growth. As COO, he will be active in the daily man-
agement of HCI’s development management and
commercial real estate ventures, which will allow
Paul Hegg, president and CEO of HCI, to focus on
investor relations.
In a statement, Hegg said he expects the
company to experience rapid growth over the
next two to three years. The company is develop-
ing apartments, offices and other businesses in the
Bakken region of North Dakota and is developing
a series of Esprit Memory Care centers. It also
operates three hotels in Sioux Falls and is develop-
ing a fourth — a Hilton Garden Inn that is cur-
rently under construction.
Schlittenhardelected toHIBCC board
DuWayne (Dewey)
Schlittenhard, vice presi-
dent of heart/vascular
and professional services
at St. Alexius Medical
Center in Bismarck, N.D.,
was recently elected chair
of the board of directors
of the Health Industry Business Communications
Council. HIBCC is an industry-sponsored, non-
profit standards development organization that
maintains labeling standards for hospital and
their suppliers.
Prior to his role at St. Alexius, Schlittenhard
was the chief operating officer at PRACS Institute
Ltd. in Fargo, as well as director of pharmacy at
MeritCare Health System in Fargo. He graduated
with a bachelor’s degree from North Dakota State
University in Fargo and earned his master's degree
from Chadwick University in Birmingham, Ala.
Steven Westra
DuWayneSchlittenhard
22 Prairie Business Magazine July 2013
North Dakota may be best known for its agri-
culture and energy sectors, but there is a grow-
ing movement to establish technology as the
third leg of the state’s powerhouse economy, particular-
ly in the Red River Valley region. The number of tech-
nology-driven companies choosing to locate in the area
continues to grow, due in no small part to the state’s
business-friendly atmosphere and investors who are
willing to foster the industry.
One of the most recent examples is Fixes 4 Kids Inc.,
a Utah-based company with Silicon Valley roots that has
devised innovative products to address pediatric orthope-
dic fractures. The company recently relocated its manu-
facturing operations to Wahpeton, N.D., where it is work-
ing with ComDel Innovations to produce its first prod-
ucts, designed to treat broken elbows in children.
Kurt Vedder, company founder and CEO, says he
had not considered moving the company to North
Dakota until he was introduced to Dan Hodgson,
founder of the Southern Valley Angel Fund, in 2011.
But after making that connection, which led to a meet-
ing with ComDel’s team and him learning about the
state’s business climate, he happily made the move. “We
continue to dig our roots into North Dakota and I
couldn’t be more pleased,” he says. “It’s a fabulous place
to do business. I think North Dakota is leading the
country in terms of a strategy to retain and build busi-
ness. The tax credits the state offers investors is a huge
benefit for building businesses and to investments in
general. Utah is way behind that and California … [is]
the opposite extreme.”
Hodgson, who also serves on the board of directors
for Fixes 4 Kids, says he was attracted to the company due
to its philosophy that innovative products can be manu-
factured and brought to the market in a more cash-effi-
cient fashion than is typically seen in large West Coast
venture fund models. The Southern Valley Angel Fund,
along with angel funds in Fargo-Moorhead and Fosston,
Minn., individual investors and the North
Dakota Development Fund, invested in Fixes
for Kids during its first round of fundraising.
Linn Grove Angel Fund, which was co-founded
by Hodgson, is an investor in the Series B.
North Dakota’s willingness to invest in technology in
particular has been helped greatly in recent years by the
state’s decision to provide a 45 percent tax credit for equi-
ty investments in early-stage, high-risk companies,
Hodgson says. “We have more companies and investors
here that are learning that this can be done here rather
than sending our money to the Coasts and letting them
do it,” he says.
The tax credit North Dakota offers for those types of
investments is one of the highest in the country. Kansas
ND investors fostergrowing tech sectorTax credits, pro-business climate continue to attract new firms, investmentsBY KRIS BEVILL
Utah-based Fixes 4 Kids Inc. recently relocated its manufacturing segment toWahpeton, N.D., to produce the EFix, a system designed to treat broken elbows inchildren. PHOTO: FIXES 4 KIDS INC.
|BUSINESS DEVELOPMENT|
23www.prairiebizmag.com
offers a 50 percent tax credit, capped at $50,000 per investment per
company each year. Minnesota had a 25 percent tax credit pro-
gram in place, and it was quite popular with the investment com-
munity, but the state legislature opted not to allocate funding for
the program this year, leaving it unfunded as of May. Business
investments in Minnesota will be hurt as a result, Hodgson says.
Fixes 4 Kids products have just recently been introduced to
the market, but the company’s goal is to generate $2 million in rev-
enue this year. By early June, it had already exceeded $800,000,
according to Vedder. The company currently employs a staff of
three in North Dakota, but plans to add personnel accordingly as
the business grows. Despite the well-reported workforce shortages
throughout the region, neither Vedder nor Hodgson believe
recruitment will be a hurdle for Fixes 4 Kids, or for other technol-
ogy companies in the area. “When it comes to building innovation
companies, North Dakota has been shipping its talent out of the
state for years, and we can attract them back when we have the
kinds of opportunities that they left to seek elsewhere,” Hodgson
says. “Any time, any day.” PB
Kris Bevill
Editor, Prairie Business
701-306-8561, [email protected]
Do you know a young professional who deserves recognition?The 40 under 40 issue of Prairie Business magazine actively supports and celebratesyoung professionals. The award honors individuals who strive toward the highest levelsof personal and professional accomplishments, who excel in their chosen field, devotetime and energy to their community in a meaningful way, and forge paths of leadership.
Nominate Today!
l l l l l l l l l l l l l l l l l l l l l
Nominate Today!
To nominate someone visit prairiebizmag.com and click onthe 40 Under 40 tab at the top of the page. The deadline forsubmissions is Oct. 1.
Professional Excellence: Demonstrate excellence, creativity and initiative in their business or profession.
Community Service: Local, state, national or international participation. Charitable services, political pursuits, religious groups, chambers, merchant’s associations, etc.
Personal Leadership: Helping themselves and others reach their full leadership potential. Prairie Business magazine’s 40 under 40 listing is slated to run in the December 2013 issue. We are seeking nominations for candidates from North Dakota, South Dakota and western Minnesota for this year’s 40 under 40. In order tobe considered, candidates must be 39 years old or younger(and can’t turn 40 until January 2014 or later).
To Nominate:
Criteria:
To Advertise: Shelly LarsonRegional [email protected]
Brad BoydRegional [email protected]
northern plains business resource
Business prairiebizmag.com
Dan Hodgson
|BUSINESS DEVELOPMENT|
24 Prairie Business Magazine July 2013
|HEALTH CARE|
Building on aHistory of ExpertiseNoridian changes name, launches massive hiring plan to meet growing health care services demandBY KRIS BEVILL
Is it possible for an existing company to fill nearly 400
open positions for high-demand jobs in a state where
the monthly unemployment rate hovers around 3 per-
cent and employers advertise thousands of job openings on
a daily basis? Fargo-based Noridian Healthcare Solutions
LLC (formerly Noridian Administrative Services) is about
to find out. The health care administrative services firm,
which already employs about 1,000 people throughout sev-
eral locations in North Dakota and around the country, was
recently awarded a five-year Medicare claims processing
contract earlier that will more than double its volume of
federal business. The contract, which was awarded through
a competitive process, makes it necessary for the company
to add about 500 employees in a variety of positions, includ-
ing customer service representatives, nurses, accountants
and information technology professionals, most of whom
will be hired to fill new roles at North Dakota locations.
President and CEO Tom McGraw, who himself just
joined the company last fall, says that despite hearing reports
detailing North Dakota’s shortage of workers and recruitment
challenges, he doesn’t think Noridian will struggle to find the
qualified workers it needs. “You would think I would be [con-
cerned], but Noridian is considered a very good company to
work for so I think we’ve been getting excellent candidates,” he
says. “Everybody has told us we are getting a stronger pool of
applicants than one might have anticipated.”
By early June, Noridian had already hosted several job
fairs in Fargo, including one in late March specifically for
employees that had been displaced after PRACS Institute’s
unexpected closure. In June, the company attracted 500
potential applicants to a job fair in Fargo. By September,
McGraw says Noridian expects to have 375 new employees in
North Dakota — 300 in Fargo, 50 in Jamestown, 15 in Leeds
and 10 in Grand Forks. Other staff will be added at the com-
pany’s facilities in Bloomington, Minn., and in California.
Noridian will take over the Medicare contract in two phases,
Part A in August and Part B in September, so the company will
stagger its hirings accordingly, with the first wave of new
employees expected to be in place late this month.
According to McGraw, potential new hires represent a
mix of local residents and interested parties willing to relocate
from elsewhere in the country, although he says most of the
applicants at its June job fair were locals. Until hiring is com-
plete, it’s difficult to estimate how many of Noridian’s new
employees will represent new residents, and therefore new
members of the state’s workforce, but local health care
providers will most certainly be keeping a watchful eye on
Noridian’s hiring process and the impact it has on their staff
numbers. The last time Noridian expanded its workforce, at
least one Fargo hospital lost a significant number of nurses to
the company and had to spend the next year aggressively
replenishing with new hires. McGraw says he sympathizes and
hopes that doesn’t happen this time around, but adds that the
nurses Noridian hires are generally looking for a way to get out
of the clinical setting anyway. “Our nurses are primarily doing
medical review-type work, so a lot of times they can do it from
home,” he says. “It’s very steady work, but maybe not as high
stress [as clinical or hospital settings].” Currently, 10 percent of
Noridian’s workforce is nurses.
It's possible for Noridian to utilize remote workers for
several types of positions within the company, but McGraw
says Noridian is among those companies that have moved
25www.prairiebizmag.com
|HEALTH CARE|
Tom McGraw joined Noridian Administrative Services last October as the second president and CEO in the company’s history. Since that time, thecompany has been awarded a massive federal Medicare claims processing contract, which requires hiring an additional 500 people, and changed itsname to reflect an expanded services focus. PHOTO: JOHN BROSE
26 Prairie Business Magazine July 2013
|HEALTH CARE|
away from the belief that telecommuters can be based anywhere
and now prefer to hire workers who are located near a company
office. “I think companies believe that even with telecommuters
you’re far better off hiring in your local area so that they can come
in for group trainings and things along those lines,” he says.
Medicare and MoreNoridian currently processes more than 102 million medical
claims annually for more than 290,000 health care providers locat-
ed in all 50 states. Three-quarters of the company’s business volume
comes from federal contracts; Medicare contracts now account for
15 percent of the company’s total business.
Noridian’s roots in Medicare contracting stretch back four
decades to the program’s very beginning. When Medicare was
launched in 1966, Blue Cross Blue Shield of North Dakota provid-
ed administrative services for the program. In 1998, BCBS of ND
became Noridian Mutual Insurance Co. and in 2002 Noridian
Administrative Services was spun-off as a separate entity to carry
out Medicare contract work. Noridian is now one of only 10 gov-
ernment Medicare and Medicaid claims contractors in the country
and has extensive experience in the administrative services process,
but the company is able to provide a list of other health care-relat-
ed services as well and has recently begun an effort to promote its
broader capabilities. The company changed its name in May, from
Noridian Administrative Services to Noridian Healthcare
Solutions, in order to emphasize this expanded focus, which
includes care and delivery management solutions to improve care
while decreasing its cost, medical review services to reduce fraud
and abuse, data analysis and the development, support and admin-
istration of health insurance marketplaces. “We’re more than a
claims administrator, and ready to help states, federal government
and business meet the new challenges they face in health care infor-
mation, systems and support,” McGraw says.
The utilization and analysis of data is an area of growing
importance for health care providers. In the past, claims data was
the only source of data analyzed for health care purposes, accord-
ing to McGraw. But that is changing. In the future, data including
electronic health records, family histories, genomics, and even
types of purchases and places of residence will be analyzed and
used by providers, including Medicare and Medicaid programs, to
help determine criteria for care. Noridian wants to expand its role
in compiling and making sense of all that data. “We see a role for
us there, primarily bringing our expertise in Medicare and clinical
expertise,” McGraw says. “For a company that is doing the kind of
Medicare administrative work that we’re doing, we have an unusu-
ally large number of statisticians, including Ph.D and master’s level
statisticians. We think we can help bring a lot of that expertise to
the field.”
The Affordable Care Act has proven to be a boost for
Noridian’s business already and the company plans to continue
growing that aspect of its services. The company is serving as the
contractor for the Maryland Health Benefit Exchange and has
spent the past year building the system for the state-based health
insurance exchange, which is scheduled to open for enrollment on
Oct. 1. Building that type of system is an extremely complex task
because the exchange must not only display different insurance
options and be able to enroll individuals, it must also have the abil-
ity to obtain information to determine an individual’s eligibility for
Noridian Healthcare Solutions is headquartered in Fargo, but employs personnel at facilitiesthroughout North Dakota as well as in Minnesota and California. PHOTO: JOHN BROSE
27www.prairiebizmag.com
|HEALTH CARE|
federal health care subsidies, according to
McGraw. “We have to get the information and
validate it against a bunch of different sources
and determine if that individual is qualified for
a subsidy and, if they are, how much of a sub-
sidy,” he says. “So an individual can choose
between different health plans, but we have to
tell the help line how much is coming from
insurance and how much is coming from the
federal government.”
Maryland is one of only a few states,
including Minnesota, which has opted to create
its own health care exchange in advance of the
Affordable Care Act’s Jan. 1 start date. The
majority of the states will at least begin comply-
ing with the law by using a federal exchange
system. McGraw anticipates that will change in
the future, however, and Noridian is position-
ing itself to be a provider of exchange systems
and related services for states as needed. “We
expect that a number of states that are using the
federal exchange initially will want to build
their own exchange,” he says. “The other thing
we want to be doing with states is providing
other services [such as call centers and commu-
nications with payers]. We would love to be
doing those types of services for them.”
Services related to the Affordable Care Act
clearly represent an area of growth for Noridian’s
state-based business. On the federal side,
McGraw expects Medicare and Medicaid pro-
grams to focus on providing more cost-effective
care and he believes Noridian can impact that
goal through its care and delivery management
and program integrity services. Long-term, he
anticipates the company will continue to grow,
although he says it is currently difficult to specu-
late at what rate and in what specific areas. “In
health care, it’s so dramatically changing that it
would be hard to do that, but we have grown
substantially in the last couple of years and we
anticipate continuing of that growth.” PB
Kris Bevill
Editor, Prairie Business
701-306-8561, [email protected]
28 Prairie Business Magazine July 2013
How High Will They Go?Strong commodity prices and low interest rates continue to impact region’s land pricesBY KYLIE BLANCHARD
|LAND VALUES|
Land prices are at historic highs across the region, driven by
strong commodities, high crop yields and historically low
interest rates. But how long this upward trend will continue
and its full impact has yet to be determined.
“We’ve had a perfect storm of factors driving land values,” says
Andrew Swenson, extension farm management specialist at North
Dakota State University in Fargo. “These include several years of strong
crop production, increases in the farmers’ ability to pay for land, low
interest rates, positive outlooks and a favorable tax climate.”
This is reflected in similar land price trends across North Dakota,
South Dakota and Minnesota, he notes. The previous peak in land
prices in North Dakota was in 1981 and prices then dropped 40 percent
over the mid- to late-1980s, finally bottoming out in 1987-1988.
“There was then a gradual rise from 1988 to 2003 and then prices
picked up,” Swenson says. “Since that time, the rise has been fairly rapid
in North Dakota and across the region.”
During 2012, land prices in North Dakota rose over 40 percent
and in 2011 and 2010, prices rose nearly 20 percent each year. “We’ve
had strong profits in crop agriculture since 2007,” Swenson says, noting
this is the result of historically high crop prices mixed with strong yields.
“This has increased both the profitability of producers and their ability
to purchase land.”
The most expensive land in North Dakota is found in the Red
River Valley, where rich soils produce bountiful crops. “Part of this
equation is the price of land is being driven by the earnings of the land,”
says Alan Butts, realtor with Pifers Auction and Realty. “The highest
prices we are seeing are in Walsh County, where sugar beet and potatoes
are grown, but we are seeing strong values all over the state in all class-
es of land.”
29www.prairiebizmag.com
|LAND VALUES|
Rising Land Values in SD and Minn.“We’ve seen a 25-year increase in land values statewide,” says
Larry Janssen, professor of agricultural economics at South Dakota
State University in Brookings. “Some years have been modest
increases, but in the last few years it has accelerated into overdrive.”
Janssen says the state experienced a 33 percent increase in land
prices in 2012 and a 26 percent increase in 2011. “The early 1970s
was the last time we saw back-to-back years with price increases over
20 percent,” he says.
The most expensive land in South Dakota is located in the east-
ern portion of the state, south of Brookings and along the Interstate
29 corridor. “We are seeing in some counties in this region an aver-
age cropland price of $8,300 per acre,” Janssen says. “Five years ago,
this same land was less than $3,800 per acre.”
Minnesota is also experiencing an upward trend in prices for its
fertile farmland. “The Morris area has the highest priced land sales
overall in our primary trade area,” says Ken Knudsen, senior vice
president and chief credit officer at AgCountry Farm Credit Services,
which provides credit and financial services to farmers and ranchers
in eastern North Dakota and northwest and west central Minnesota.
“Land outside of the Red River Valley has gone up more than land
values in the valley, but all areas have seen significant increases and
strong demand.”
Managing Risk Knudsen says rising land prices in the region have created pri-
marily positive impacts. “Often high land prices are talked about as
if it is a bad thing, but most people hope what they buy goes up in
value,” he says. “It may be a fear that we will see a return of what hap-
pened in the 1980s when land values fell 50 to 70 percent in our area.
However, there are many different protections in place today to make
those events unlikely. The sound crop insurance programs of today
are probably the most important risk mitigators we have.”
The many ways risk is reduced has contributed to strong land
prices in the region, according to Knudsen. “Borrowers have locked
in good interest rates for longer terms, up to 25 years; loans are more
collateralized; there is room in cash rents and some crop inputs to
help reduce operating costs; farmers have built up and maintained
better working capital positions and overall financial strength; and
lenders have maintained good credit disciplines and avoided excess
leverage,” he says.
“Ultimately, though, it is still old-fashioned supply and demand
that determines land values. Lenders and borrowers just have to be
smart to position themselves so they can be in a good position to
handle whatever comes,” he says.
Reaching the Land Price PinnacleNorth Dakota Agriculture Commissioner Doug Goehring says
the price of both land and commodities in the region is reaching an
apex. “We are starting to see a trend downward nationwide and we
will begin to see this in North Dakota,” he says. “Commodity prices
are leveling off and land prices will follow the same trend.”
He says the current land prices have also been driven by farm-
ers’ ability to purchase land. “The average farmer in North Dakota is
between 57 and 58 years old, and has been in the business a long
time. They have fixed assets and have paid off their debt with secure
capital, and then they have purchased land close to them.”
The decreased risk associated with land purchases has also
encouraged the next generation of family farmers to get involved
with land purchases. “Agriculture has become more appealing and
has become more stable,” Goehring says. “Farmers have the ability to
help the next generation transition into the operation.”
He notes the sustainability of current land prices is going to be
dependent on the continued ability of landowners to balance the
ratio of the land’s market value to production value after purchasing
land at current prices. “When you get a loan or buy land, the land has
to produce to pay for itself,” he says. “Right now the market value
may be, for example, $1,000 per acre, but the productivity value may
only be several hundred dollars per acre.”
Goehring says those most impacted by the high land prices are
young and beginning farmers who have established their operations
in the last 10 years. “It is pretty volatile for them. These producers are
establishing debt in good times and that is tricky.”
“Most of the people buying land are adding to an existing land
base,” adds Butts. “Prices now make it hard for someone to break into
land purchasing.”
The Future of Land PricesSwenson says land prices in North Dakota are not expected to
drop in 2013. “This is a historic time and how long this can contin-
ue is questionable,” he says. “The main drivers have been high crop
prices and low interest rates.”
The outlook for 2014 is uncertain, but Swenson says his best
guess is crop prices will be lower and interest rates will be higher by
late 2014 or 2015. As a result, land price levels will flatten out and
possibly begin a decline.
“Are people paying more than what is economically sustainable
at this time?” asks Butts in regards to what the future holds for land
prices. “We’ll have to see how things play out in the next few years.”
How long the high land prices will continue is “the big
unknown,” Janssen adds. He believes prices in South Dakota will
continue to rise for another year, but could begin to change in the
next two years.
Knudsen says landowners’ profits are going to play a key role in
the future of land prices. “Profit margins determine the prices. As
long as there are profits and the belief that profits will continue, land
prices get bid up to those levels. Once the profit margins are low or
negative, land values fall to match up with the margins.”
But Janssen says the land prices are a reflection of the positive
economy of the region.
“The impacts of land prices are not immediate, but over time,
the land prices speak about the wealth of the region.” PB
Kylie BlanchardContributing writer
701-391-0373, [email protected]
30 Prairie Business Magazine July 2013
|SOUTH DAKOTA|
The Black Hills, home to the Sturgis
Motorcycle Rally and miles of scenic
bicycle trails, is a great place for anything
on two wheels. But it wasn’t location that
prompted Ryan McFarland to launch Rapid
City, S.D.-based balance bike company Strider
Sports International Inc. six years ago. Instead,
he has his son to thank for the inspiration.
“I had a two-year-old and was an over-eager
dad who wanted to share my passion for riding
with him,” McFarland says. An avid motorcycle
racer and bike rider, McFarland says he filled his
garage and house with every type of child’s riding
toy available, but soon realized that every ride-on
toy on the market was simply too heavy, too big
and too complex for the toddler set. Being an
entrepreneur and inventor (he holds several U.S.
patents), McFarland’s tendency to tinker kicked in
and led him to create the perfect bike for tykes —
a no-pedal bike that was light-weight enough for
his toddler to handle and low enough to the
ground for his little legs to move it. He had no
intention of getting into the bike business, but
steady inquiries from would-be customers who
saw his son’s bike soon changed his mind. “We
realized that there was too much interest not to do
something with it,” he says.
McFarland launched Strider in 2007 and
spent most of the year working nights and week-
ends to develop the prototypes and acquire
financing while still working full-time at the
mortgage company he owned. He received the
first shipment of bikes from a manufacturer in
China that November and sold a modest 6,000
bikes in 2008. Sales started taking off in 2009 as
word spread about the product and the business
grew at such a rate that McFarland sold his mort-
gage company in order to focus entirely on
Strider. By 2010, the company had grown to
include five employees and moved its operations
Strider Sports International Inc. founderand CEO Ryan McFarland credits theInternet, social media and an aggressivemarketing campaign for his company’srecent growth. PHOTO: STRIDER SPORTSINTERNATIONAL INC.
No-pedal bike company hits its strideSales climb at Strider SportsInternational as kids, parents seebenefits of balance bikesBY KRIS BEVILL
31www.prairiebizmag.com
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|SOUTH DAKOTA|
into a large warehouse space in Rapid City to house its
inventory. This year, the company expects to sell more than
300,000 bikes worldwide, amounting to $13 million in sales.
Strider currently employs 30 people and will expand to an
even larger facility this fall to accommodate the company’s
continuous growth.
McFarland credits the Internet, an aggressive market-
ing campaign and parents, who serve as Strider’s “army of
unpaid salesmen,” for the company’s growth.
“I would never even have started the company from
Rapid City if the Internet didn’t exist,” he says, adding that
exports account for about half of the company’s sales. Social
media has also played a prominent role in Strider’s growth.
The company sets up riding areas at events large and small
around the world, including parades, home shows, the Indy
500 and Sturgis, attracting toddlers and skeptical parents
who can’t help but take photos of their children and share
them via social media after seeing their tiny tots ride a bike.
The viral marketing campaign extends to neighborhoods as
well. “Every time a bike goes out into a neighborhood, it
helps sell more bikes,” he says.
No-pedal bikes are not a new invention, but parents
who likely have envisioned a bike with training wheels as
their child’s first bicycle typically need a little convincing to
give it a try, McFarland says. For this reason, it’s often other
parents who serve as Strider’s most effective sales people.
And Strider’s bikes differ from competitor’s products in that
they are designed specifically for very small children, ages 18
months and up, offering kids the chance to begin riding as
soon as they are able to walk, which parents often have dif-
ficulty believing until they see it, he says.
Strider plans to continue marketing its product around
the world, including on its home turf. The company is plan-
ning to display its products at three locations during the
Sturgis bike rally this year, setting up booths at the Buffalo
Chip campground, the motorcycle museum on Main Street
in Sturgis and at Black Hills Harley Davidson in Rapid City.
By October, McFarland hopes to be settled into the
company’s new building, giving everyone time to gear up for
the end-of-the-year rush. “Christmas season is out of con-
trol here,” he says. “That’s our No. 1 season.” PB
Kris Bevill
Editor, Prairie Business
701-306-8561, [email protected]
32 Prairie Business Magazine July 2013
|WESTERN NORTH DAKOTA|
Experiencing the BakkenTour provides extensive, first-hand look at Williston Basin boomBY KRIS BEVILL
The local philosophy in the Bakken is that if
you want to do business there, you need to be
there. There’s an obvious reason for this:
Locals are so busy they can’t keep up with phone
messages and random requests for information. But
there’s another reason, too: Unless you’re there, you
can’t truly comprehend the enormity of what is hap-
pening. The Bakken boom deserves to be seen with
your own eyes, and if you can find a local to show
you around, that’s even better.
Jeff Zarling, founder and president of Williston-
based web development, communications and mar-
keting firm Dawa Solutions Group, launched the
Bakken Field Tour last year to offer a first-hand look
to anyone wanting to better understand the Williston
Basin. He says he got the idea for the tour after nation-
al media attention in late 2011 led to a sudden influx
of inquiries from people all over the world, all want-
ing to know more about the boom but having no real
knowledge about the area in general. The tours have
drawn a global audience of investors, developers and
media, but local residents and business people also
regularly attend the tours, proving that it’s difficult for
everyone to keep up with the rate of changes taking
place in the region.
This year, Dawa Solutions is hosting tours from
Williston and Dickinson. One of the first events of the
season, held in May in Williston, attracted a small but
diverse group, including representatives from a local
trucking company, leaders of a major shipping supplies
company and a television news crew from France.
Attendees were there to consider investment possibili-
ties, catch up on the latest developments and educate
themselves on the boom and its impacts.
Each tour begins with a 3-hour workshop, deliv-
ered by Zarling, which covers the history of Bakken oil
drilling, technological developments that made the
current boom possible, economic activity, risk factors
and current development needs. His goal is to provide
attendees with enough information to enable them to
conclude independently long the boom will last, which
he says is always the No. 1 question.
The Williston Bakken Field Tourincludes a drive along Highway85, notoriously known as thedeadliest highway in NorthDakota, where attendees see forthemselves the constant flow oftruck traffic between Willistonand Watford City. PHOTO: KRIS BEVILL, PRAIRIEBUSINESS MAGAZINE
33www.prairiebizmag.com
|WESTERN NORTH DAKOTA|
There is so much ground to cover during the
workshop and driving tour, literally and figuratively,
that the day stretches easily to eight hours. The
Williston-based tour includes a stop at a Target
Logistics crew camp on the eastern edge of town, where
visitors are given a tour of the facility and treated to a
surprisingly high-quality lunch at the camp’s cafeteria.
From there, the day includes a pass through Watford
City, Alexander, New Town, Tioga, Stanley, Ray and
Epping.
There are few stops on the road — if you exit the
highway, the wait to merge back onto the highway amid
endless truck traffic can throw the whole day’s schedule
off track. But Zarling keeps attendees engaged while on
the road and does his best to put the boom’s impact on
the region into perspective for all tour attendees. He gets
admittedly excited when talking about the development
opportunities in the region, but he’s also honest about
the difficulties that come with it and provides the per-
spective of a resident and business person when dis-
cussing issues such as housing, traffic congestion and
quality of life changes, like hunting grounds that have
been lost to oil development. When attendees get a whiff
of awful-smelling hydrogen sulfide (H2S) as the tour
van drives downwind from a well, Zarling explains what
it is (a heavy gas associated with natural gas production)
and the hazards it presents to workers. He acknowledges
the rampant flaring of natural gas at many of the wells
throughout the area, but is quick to point out the differ-
ence when the tour enters the “older” part of the
Bakken. There, trucks and flares are fewer because the
infrastructure to capture and transport natural gas has
caught up to drilling. It’s a hopeful indicator of what the
future may hold for the rest of the region.
Tour organizers promise an experience that
allows attendees to “see and feel the sheer volume and
velocity of activity” in the region, and that promise is
surpassed. Attendees, see, hear, smell, taste and feel
the impacts of the boom, although what they choose
to do with the information is as varied as their places
of origin. PB
Kris Bevill
Editor, Prairie Business
701-306-8561, [email protected]
Jeff Zarling, founder and president of Williston-based Dawa Solutions Group, hosts theBakken Field Tour. PHOTO: KRIS BEVILL, PRAIRIE BUSINESS MAGAZINE
Overflowing parking lots, seemingly sprouting up in the middle of nowhere, oil rigs andunit trains hauling Bakken crude are common sights when touring the Williston Basin. PHOTO: KRIS BEVILL, PRAIRIE BUSINESS
Attendees see, hear, feel, taste and smell the impacts ofthe boom, although what they choose to do with theinformation is as varied as their places of origin.
34 Prairie Business Magazine July 2013
|RED RIVER VALLEY|
Nonprofit sets example for effective, multi-source fundingTax credits, grants, donations fuel $15 million Family HealthCare projectBY KRIS BEVILL
When Fargo’s Family HealthCare began
planning a project in 2008 to move the
center into a larger space that would
accommodate the growing need for its services, CEO
Patricia Patrón knew she would have to find an
innovative way to pull together the $15 million
needed for the project. The nonprofit health care
organization worked hard to run a sustainable
operation, but as with most nonprofits, money was
tight and it would be impossible for FHC to fund a
major project on its own.
Fortunately, the American Recovery and
Reinvestment Act of 2009 included a rare opportunity
for Federally Qualified Health Centers like FHC to apply
for grant money to support those kinds of projects, and
in December 2009, FHC was awarded a $6.6 million
grant. That support, combined with local contributions
and smaller grants, only provided a little more than half
of the money needed to carry out the project, however,
so Patron decided to explore other mechanisms that
hadn’t been commonly used in North Dakota to supply
additional funding. Tax credit programs offered an
opportunity, but the process was quite complex and she
realized FHC needed guidance to maneuver through the
various hurdles involved in funding a project by using a
combination of tax credits and grants.
After consulting with the U.S. health and human
services department for help, she was connected with
another nonprofit, Central City Concern in Portland,
Ore., which had recently become the first organization
in the nation to use a combination of stimulus grant
money, multiple federal tax credits and other financing
to fund clinic expansions.
“We’d had a lot of prior mixed-used financing
experience both in the housing and on the medical side,
so we were quickly able to do that,” says Sean Hubert,
senior director of housing at Central City Concern.
“FHC was trying to do the same thing, but was hitting
some roadblocks and having some difficulties.”
With Central City Concern as consultants, FHC
was able to piece together a similar funding package.
Federal and state historic tax credit programs were uti-
lized to provide $1.5 million in funding. The federal
New Market Tax Credit program, which encourages
investment in low-income areas, was tapped for an
additional $4.1 million. As a result, FHC was able to
begin construction of the project in 2011 with 90 per-
cent of the project’s cost in hand.
Funding models like those used by FHC and
Central City Concern become very complex because
each tax credit bears varying legal structures and com-
mercial debt must be provided by a lender willing to be
Fargo’s Family HealthCare, anonprofit medical and dentalclinic, utilized an innovativefunding strategy to raise mostof the $15 million needed torelocate to a larger facility.PHOTO: JOHN BORGE
35www.prairiebizmag.com
a second-tier addition in the capital stack, according to Hubert. Patron
says she hopes other nonprofits can learn from FHC’s experience and
use it as an example for their own projects. “Sometimes you just need
to think outside the box and learn about these things that are happen-
ing outside of our communities,” she says. “We were the first program
in North Dakota to use three different federal funds to complete a mas-
sive capital project. These things are out there and we just need to be
attentive and keep our heads looking outside the community to see
how we can bring wealth into the community.”
The federal grant used by FHC is no longer available, but tax
credit programs continue to present the opportunity for creative fund-
ing packages, according to Hubert. “Depending on the project, if you
can twine historic and new market tax credits into a deal, and you’ve
got a good team and good investors, sometimes you can get 40 percent
or so of a project cost covered between those two tax credits,” Hubert
says. “Then all of a sudden your project cost is 60 percent and that’s
much easier.”
FHC opened the doors to its new facility late last year, but contin-
ues to seek funding for the remaining $1 million of the project cost and
has until November to meet that goal. Patrón is optimistic the organi-
zation will meet its goal, although she admits that nonprofits have
found it difficult to fundraise in the post-economic downturn, even in
wealthy states like North Dakota. “I think we’re all becoming more
sophisticated at fundraising, which is good, but I wouldn’t say it’s eas-
ier, even in a state which has a surplus,” she says. PB
Kris Bevill
Editor, Prairie Business
701-306-8561, [email protected]
|BUSINESS TO BUSINESS|PRAIRIE BUSINESS
National perspective.Regional expertise.Trusted advisor.
kljeng.com
To Advertise:John Fetsch701.238.9574 • [email protected]
Brad Boyd1.800.641.0683 • [email protected]
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36 Prairie Business Magazine July 2013
Congress’ approval of a one-year
extension to the 2.2 cent per kilowatt
hour wind energy production tax
credit (PTC) earlier this year provided some
relief to the industry and has spurred
renewed interest in manufacturing and pro-
duction projects, but the long-term fate of
the industry remains unclear.
In late May, Quebec-based Marmen Inc.
celebrated the opening of its first U.S. plant, a
wind tower fabrication plant in Brandon, S.D.
The facility was originally built in 2010 by
another company which planned to manufac-
ture wind towers, but the project stalled when
the company, Tower Tech Systems, failed to
secure enough contracts for towers, says Nick
Fosheim, executive director of the Lincoln &
Minnehaha County Economic Development
Associations. Construction of the building had
been completed and some equipment was
installed, but the company never hired any of
the proposed 150 employees. Marmen plans to
Patrick Pellerin, president of MarmenInc., announces the company’s plans toopen Marmen Energy during a pressconference held May 28 in Brandon, S.D. PHOTO: CATHERINE THURMAN
Wind forecast: Outlook hesitantly optimistic Regional developments suggest tempered growth in wind energy industryBY KRIS BEVILL
37www.prairiebizmag.com
kljeng.com
As the only Rrm headquartered in
North Dakota listed on
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add 50,000 square feet to the 150,000-square-
foot space and has already begun recruiting
employees, according to the company. It expects
to begin operating at the end of this year and
will employ up to 250 people when the facility is
fully operational next year.
Fosheim says Marmen’s plant opening will
have a significant economic impact on Brandon
and the surrounding area. “Certainly, we’ll see
an increase in the local employment opportuni-
ties, but we’ll also see increased residential
growth and increases in sales tax revenue,” he
says. “It will challenge us to grow our training
programs to meet the continued demand by
local employers. All of this will impact the entire
region, not just Brandon. When you consider
Marmen’s international reputation, this really
puts us on the map in terms of recruiting new
business to the area.”
Brandon, located just a few miles east of
Sioux Falls, S.D., has a population of about
9,000. At 250 employees, Marmen would be
Brandon’s largest employer, according to
Fosheim. Marmen has launched a vast recruit-
ment campaign to locate staff and Fosheim says
local and state agencies will assist. “It’s our job in
economic development to connect businesses
with the right partners so they can be successful
here,” he says. “We have an opportunity to prove
that even though unemployment is low, oppor-
tunity is high and our region is growing.
Marmen has said it is hiring primarily character,
not skills, because they are willing to train. That
approach may prove beneficial as they ramp up
to full production.”
Ron Rebenitsch, executive director of the
South Dakota Wind Energy Association, says
Marmen’s expansion to South Dakota demon-
strates positive movement in the industry, but
the ongoing national recovery from the reces-
sion and low natural gas prices continue to
impact the industry’s overall growth. “On the
positive side, projects that have been on hold are
coming back, not so much in the Dakotas but in
other parts of the country,” he says, adding that
locating production facilities in the northern
Plains, like Marmen has done, makes strategic
sense. “It’s a solid business decision to place a
factory in the middle of the industry,” he says.
“By building towers in this region, you can elim-
inate some of the cost of transport.”
Fargo-based Wanzek Construction, a
MasTec company, has installed more than 5,000
megawatts of wind generation capacity across the
U.S. and is currently actively working on the pre-
liminary stages of a number of projects, but it’s
too early to say whether those projects will come
to fruition, says Rob Lee, director of operations for
Wanzek’s wind energy group. “It seems as though
the appetite from utilities is not where it needs to
be to build a bunch of projects at the moment,” he
says. “The PTC has helped the renewable industry
considerably but a one-year extension is tough
because it creates a roller coaster of projects, where
every other year we are busy.”
Wanzek constructed wind projects in sev-
eral states and in Puerto Rico last year, but none
in the Dakotas or Minnesota. So far this year, the
company is bidding on projects throughout the
U.S., with a concentration in Iowa, North
Dakota, Oklahoma and Texas, according to Lee.
Minnesota Power, a division of ALLETE,
recently celebrated the completion of the final
phase of it its $500 million, 101-tower Bison
Wind Energy Center near New Salem, N.D., and
could announce more wind energy investments
in North Dakota this year, pending permitting
approvals and other considerations. Todd
Simmons, Minnesota Power’s general manager
of wind operations, says he believes there is
room for wind energy to grow in North Dakota,
particularly for companies like Minnesota
Power, which must comply with Minnesota’s
requirement that utilities obtain 25 percent of
their power from renewable sources by 2025.
Renewables currently account for between 15
and 18 percent of Minnesota Power's supply,
but its long-term goal is to generate power from
an equal mix of renewable, natural gas and coal-
based sources.
Minnesota Power holds wind options on
approximately 120,000 acres of land adjacent to
the Bison Wind Energy Center, which will
remain in place for nearly 50 years. The utility
currently provides service to about 143,000 cus-
tomers across 26,000 square miles in northeast-
ern Minnesota. PB
Kris Bevill
Editor, Prairie Business
701-306-8561, [email protected]
|ENERGY|
38 Prairie Business Magazine July 2013
|ENERGY|
The U.S. Geological Survey’s recently updated assessment of oil
and gas reserves believed to be contained in the Williston Basin
predicts that the region contains twice as much oil and three
times as much natural gas as was estimated in 2008. It now believes
there are approximately 7.4 billion barrels of technically recoverable
oil and 6.7 trillion cubic feet of undiscovered natural gas in the basin.
The significant increase in estimated recoverables is due to the inclu-
sion of the Three Forks Formation in addition to the Bakken Formation,
according to the USGS. When the 2008 survey was conducted, little data
existed on the Three Forks Formation and it was believed to be unproduc-
tive, the agency stated. However, new drilling delivered a new perspective
on the formation’s potential, thus leading to the updated estimate.
The updated government assessment likely came as no surprise to
the oil and gas industry, which has been building out its infrastructure for
a long-term play for several years already, but it could provide much-
needed reassurance for investors and developers who may be skittish
about participating in an oil boom area.
Sen. John Hoeven, R-N.D., said he asked the Interior Secretary to
conduct a new survey more than two years ago, with the goal of stimu-
lating more private investment activity in the region to support its grow-
ing needs. He expressed satisfaction with the survey results and suggest-
ed that if the industry is right, even the high end of the USGS assessment
— 11.4 billion barrels of oil — could prove to be low. “This is clearly great
news for North Dakota and great news for the nation, and we believe it
is a conservative estimate, based on industry assessments,” he said in a
statement. “This new USGS study further confirms and reinforces the
fact that the Williston Basin is a sustainable, long-term play warranting
strong private-sector investment for decades into the future.”
Dean Bangsund, a research scientist at North Dakota State
University in Fargo who has conducted a significant amount of research
on the Williston Basin, agrees that the updated USGS assessment is not
news for the industry, but provides investors and developers with clari-
fication on the longevity of the activity. “I think that is absolutely criti-
cal for the proper flow of investment dollars,” he says. “They need to
understand the duration and magnitude of the development and they
need to be able to understand what the uncertainty and risk is. I think
having the USGS come out and publicly state what they think the num-
bers are, even if the industry already knew it, it’s important for them to
get that information.”
Bangsund says the updated assessment also highlights the tremen-
dous economic opportunity facing North Dakota and should be
addressed appropriately. “The economic output from the Williston Basin
is likely to continue, which means we’re going to continue to have strong
employment in the state, strong business activity, opportunities for new
businesses,” he says, adding that it also indicates a long-term, sustainable
source of state revenues generated from oil and gas output. But the most
significant takeaway for the state, he says, should be the realization that it
needs to collectively address the infrastructure needs in western North
Dakota in order for the region to handle its bigger economy. “It isn’t just
a function of putting homes in; we also have to put in parks, golf cours-
es,” he says. “We have to make sure that the support services that go with
that workforce are there. All of that has to be built up to handle a much
larger economy in the western part of the state. At the same time, the state
can’t ignore that we’re growing elsewhere as well. We have those develop-
ment concerns that we need to address long term in the state.” PB
Kris Bevill
Editor, Prairie Business
701-306-8561, [email protected]
Updated estimates on the anticipated sizeand duration of western North Dakota's oilplay is expected to ease investor concerns,spurring more housing and infrastructuredevelopments. PHOTO: KRIS BEVILL,PRAIRIE BUSINESS MAGAZINE
Increased oil estimate couldboost investor confidenceUpdated USGS survey predicts twice the oil previously thought held in Williston Basin BY KRIS BEVILL
R001910013
40 Prairie Business Magazine July 2013
|BY THE NUMBERS|Employment UNEMPLOYMENT RATE EMPLOYMENT
Mar-13 Mar-12 Mar-13 Mar-12North Dakota 3.20% 3.00% 385,147 378,428Bismarck MSA 3.5 3.6 58,054 58,538Fargo MSA 4.2 4.2 114,703 113,629Grand Forks MSA 4.7 5.1 51,166 51,815Dickinson MiSA 1.8 1.8 20,968 19,379Jamestown MiSA 4.5 4.1 9,826 10,404Minot MiSA 3.9 3.4 34,758 33,859Wahpeton MiSA 4.8 5 10,987 11,371Williston MiSA 1 0.9 41,171 31,758South Dakota 4.30% 4.40% 428,290 426,599Rapid City MSA 4.6 4.9 63,095 63,039Sioux Falls MSA 4 4.7 128,483 124,765Aberdeen MiSA 3.7 4.1 22,323 22,361Brookings MiSA 3.5 3.9 18,548 18,534Huron MiSA 4.2 3.8 9,546 9,466Mitchell MiSA 4 4 12,792 12,703Pierre MiSA 3.4 3.7 11,608 11,585Spearfish MiSA 4.6 5 12,145 12,158Vermillion MiSA 3.8 3.5 7,524 7,548Watertown MiSA 4.5 4.8 18,193 18,225Yankton MiSA 4.2 4.3 11,383 11,205Minnesota 5.40% 5.70% 2,821,531 2,802,850Minneapolis-St. Paul MSA 5.4 6 1,767,024 1,735,317Alexandria MiSA 5.6 6 19,488 19,546Bemidji MiSA 8 8.3 20,041 20,326Brainerd MiSA 9.4 9.9 40,295 40,757Fairmont MiSA 5.9 5.8 10,135 11,041Fergus Falls MiSA 7.2 7.2 27,746 28,718Hutchinson MiSA 7.7 8.2 17,508 18,221Marshall MiSA 5.3 5.3 13,968 14,211Red Wing MiSA 5.9 6.4 24,143 24,059Willmar MiSA 6.2 6.1 22,346 23,642Winona MiSA 4.7 5.4 27,839 27,754Worthington MiSA 4.4 4.5 10,813 11,235
Data provided by David Flynn, chair of the University of North Dakota Department of Economics. Reach him at [email protected].
Mar-13Mar-11
186205
87.2576.29
AverageRig Count Price
Mar-13Mar-12
8,6346,932
782,812577,478
218181
ProducingWells
AverageDaily
ProductionTotal
Permits
Oil Production
Jan2000 Jan2002 Jan2004 Jan2006 Jan2008 Jan2010 Jan2012 Jan2014
1.6
1.5
1.4
1.3
1.2
1.1
1
0.9
Cana
dian
Dol
lars t
o One
U.S.
Dol
lar
Jan2000 Jan2002 Jan2004 Jan2006 Jan2008 Jan2010 Jan2012 Jan2014
7
6
5
4
3
2
1
0
Perce
nt
E ective federal funds rate10-year treasury constant maturity rate
Interest Rates
Exchange
Jan 2000 Jan 2002 Jan2004 Jan2006 Jan2008 Jan 2012 Jan2012 Jan2014
3
2.5
2
1.5
1
0.5
0
Charge-o� rate, single family homeCharge-o� rate, business loan
Jan 2000 Jan 2002 Jan2004 Jan2006 Jan2008 Jan 2012 Jan2012 Jan2014
9
8
7
6
5
4
3
2
Weighted-average e�ective loan rate, all C&I loans
Jan 2000 Jan 2002 Jan2004 Jan2006 Jan2008 Jan 2012 Jan2012 Jan2014
235
230
225
220
215
210
205
Finance, Insurance, Real Estate Employment in the Tri-State Area
Thou
sand
s of E
mpl
oyee
s
FIRE Employment
National Average Rate on Business Loans
Charge-off Rate for Business Loans and Mortgages
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