SCHMID: LOOKING BACK FROM THE LEFT COAST - FEBRUARY 15, 2016
MOOD RESET For years ND has been the economic envy of nearly every state. The state’s growth, income and employment fed continuous headlines and pumped the self-esteem of residents. Now, there’s a new set of headlines. The latest Business Week: “The Bakken Bust Hits North Dakota Hard.” The Wall Street Journal lumped ND with Alaska, Texas, Louisiana and Oklahoma: “Oil-Price Decline Squeezes States.” ND Budget Director Pam Sharp says the biggest revenue losses are coming from sales tax on fracking equipment and supplies. ND has 1,000 wells which have been drilled, but will not be fracked until there is a market recovery. In the meantime, the state must adjust its mind set as well as its spending.
“IT’S PRETTY DISMAL” -- ND ag commissioner Doug Goehring. While low oil prices are the big attention getter, farmers are seeing some of the lowest commodity prices of the decade. ND farmers are planning for their worst spring wheat prices in at least six years. Most crops grown in ND have production costs which exceed market prices, in other words, farmers face built-in losses.
UND AT A CRITICAL STAGE. Its president retired leaving a demoralized campus facing large budget cuts. Time for tough decisions. This is what governors do -- they balance budgets and make difficult decisions about people and programs. Fortunately, there is a governor available to help make those decisions. Acting UND president and former governor Ed Schafer hit the ground running and issued a public statementl outlining short-term budget cuts, but also calling for longer-term plans that are “strategic and sustainable.” There will be bumps and bruises -- Schafer is running interference, so a new UND president will not immediately face the same issues.
DOUG BURGUM, Fargo entrepreneur and Republican candidate for governor, contends ND is overly reliant on energy and agriculture, both of which are in a downturn. In a letter to the state’s newspapers he cites a Bloomberg Business innovation index listing ND 40th. Bloomberg says the ranking “Illustrates what happens when economic growth is concentrated in one industry.” Burgum believes ND needs to diversify its economy and streamline state government, thereby taking better control of state tax revenue and spending structure.
MAJOR OBSTACLE? In his SayAnythingBlog, Rob Port makes the case that Doug Burgum is a rich man benefiting from property tax subsidies for his Fargo real estate developments. Both appear true -- Burgum is rich and receiving subsidies. Port views this as a potential “major obstacle” to Burgum in the race for governor and seems particularly concerned by Burgum’s wealth.
WEALTH MAKES IT POSSIBLE Burgum’s real estate investments have been a key factor in giving downtown Fargo a new life. The tax benefits were probably available to any party with the capacity and willingness to take the related investment risks. With Burgum’s high tech background, he almost certainly had better investment opportunities. Also, redevelopment of the Fargo properties may not be viable without tax relief. Fargo leaders have repeatedly said how fortunate Fargo is to have an investor with means, vision and faith in the city. Fargo is a standout among Midwestern cities of it size -- Burgum’s high tech wealth is an enabler.
GO FIGURE Dickinson has 1,800 hotel rooms, an addition of 1,000 since 2009. That’s the good news; the bad news, last year the rooms were only half occupied. That hasn’t stopped a 90-room Marriott hotel from opening this month. The owners of the new hotel are undeterred by the oil industry slowdown, believing customer loyalty and a “power brand” boost their prospects.
RETREADED MAN CAMP The ND Dept. of Corrections was preparing to ship prisoners to Colorado because of crowded conditions, when someone had a bright idea. How about a man camp building? A 185-foot structure was promptly moved from Tioga to Bismarck where it provides separate rooms for each of 36 beds. The little rooms are rented from Target Logistics for $35 per bed per day. The rooms are used for transitional housing (prisoners nearing release) and are more pleasant than jail cells.
DALE LENNON was a successful (90-24 record), popular football coach at UND from 1999-2007, when he was hired as head coach at Southern Illinois. After last season, Lennon was fired at Illinois. He has reappeared in ND as director of public affairs at the U. of Mary in Bismarck where he had once been the football coach.
QUADRUPLETS Connie, Clayton, Cleo and Claire were born in Fargo on February 6, 1941 and soon featured in Carnation Milk ads. In payment, the quads received free milk. To protect the financial interests of the quads, their obstetrician, Dr. J.F. Hanna, was appointed guardian and all financial offers involving the quads required court approval. Claire died in 2001, his sister and two brothers just celebrated their 75th birthday in Fargo.
“MINNESOTA MUSLIMS do face hate and harassment.” -- StarTribune editorial. The editorial furnished various examples supporting the statement, one example: “A Minnesota man firebombs a Somali restaurant in downtown Grand Forks, N.D.” The StarTribune urged Minnesotans to be more welcoming of Muslims. “Why Muslims particularly? Because they face the greatest challenge right now. Unlike previous immigrant groups, they carry the identity and customs that some see as those of the enemy.”
DAKTOIDS: Two-thirds of the dentists in ND are bunched in four counties with the largest cities. Some Indian reservations and rural counties have no dentists . . . A plant near Beulah converts lignite into natural gas. An adjacent plant costing $500 million is under construction and will convert byproducts from the natural gas plant into urea pellets to fertilize wheat, soybeans and corn.
“IT’S PRETTY DISMAL” -- ND ag commissioner Doug Goehring. While low oil prices are the big attention getter, farmers are seeing some of the lowest commodity prices of the decade. ND farmers are planning for their worst spring wheat prices in at least six years. Most crops grown in ND have production costs which exceed market prices, in other words, farmers face built-in losses.
UND AT A CRITICAL STAGE. Its president retired leaving a demoralized campus facing large budget cuts. Time for tough decisions. This is what governors do -- they balance budgets and make difficult decisions about people and programs. Fortunately, there is a governor available to help make those decisions. Acting UND president and former governor Ed Schafer hit the ground running and issued a public statementl outlining short-term budget cuts, but also calling for longer-term plans that are “strategic and sustainable.” There will be bumps and bruises -- Schafer is running interference, so a new UND president will not immediately face the same issues.
DOUG BURGUM, Fargo entrepreneur and Republican candidate for governor, contends ND is overly reliant on energy and agriculture, both of which are in a downturn. In a letter to the state’s newspapers he cites a Bloomberg Business innovation index listing ND 40th. Bloomberg says the ranking “Illustrates what happens when economic growth is concentrated in one industry.” Burgum believes ND needs to diversify its economy and streamline state government, thereby taking better control of state tax revenue and spending structure.
MAJOR OBSTACLE? In his SayAnythingBlog, Rob Port makes the case that Doug Burgum is a rich man benefiting from property tax subsidies for his Fargo real estate developments. Both appear true -- Burgum is rich and receiving subsidies. Port views this as a potential “major obstacle” to Burgum in the race for governor and seems particularly concerned by Burgum’s wealth.
WEALTH MAKES IT POSSIBLE Burgum’s real estate investments have been a key factor in giving downtown Fargo a new life. The tax benefits were probably available to any party with the capacity and willingness to take the related investment risks. With Burgum’s high tech background, he almost certainly had better investment opportunities. Also, redevelopment of the Fargo properties may not be viable without tax relief. Fargo leaders have repeatedly said how fortunate Fargo is to have an investor with means, vision and faith in the city. Fargo is a standout among Midwestern cities of it size -- Burgum’s high tech wealth is an enabler.
EMERGING STORIES The shooting death of a Fargo police officer and the suspected murder of a 36-year-old Minnesota woman found on the Spirit Lake Reservation were both developing stories today. A Fargo police officer had not been killed on duty since 1882. The Minnesota woman had been missing since October and a Spirit Lake couple in prison on other charges are suspected of being involved.
GO FIGURE Dickinson has 1,800 hotel rooms, an addition of 1,000 since 2009. That’s the good news; the bad news, last year the rooms were only half occupied. That hasn’t stopped a 90-room Marriott hotel from opening this month. The owners of the new hotel are undeterred by the oil industry slowdown, believing customer loyalty and a “power brand” boost their prospects.
RETREADED MAN CAMP The ND Dept. of Corrections was preparing to ship prisoners to Colorado because of crowded conditions, when someone had a bright idea. How about a man camp building? A 185-foot structure was promptly moved from Tioga to Bismarck where it provides separate rooms for each of 36 beds. The little rooms are rented from Target Logistics for $35 per bed per day. The rooms are used for transitional housing (prisoners nearing release) and are more pleasant than jail cells.
DALE LENNON was a successful (90-24 record), popular football coach at UND from 1999-2007, when he was hired as head coach at Southern Illinois. After last season, Lennon was fired at Illinois. He has reappeared in ND as director of public affairs at the U. of Mary in Bismarck where he had once been the football coach.
QUADRUPLETS Connie, Clayton, Cleo and Claire were born in Fargo on February 6, 1941 and soon featured in Carnation Milk ads. In payment, the quads received free milk. To protect the financial interests of the quads, their obstetrician, Dr. J.F. Hanna, was appointed guardian and all financial offers involving the quads required court approval. Claire died in 2001, his sister and two brothers just celebrated their 75th birthday in Fargo.
“MINNESOTA MUSLIMS do face hate and harassment.” -- StarTribune editorial. The editorial furnished various examples supporting the statement, one example: “A Minnesota man firebombs a Somali restaurant in downtown Grand Forks, N.D.” The StarTribune urged Minnesotans to be more welcoming of Muslims. “Why Muslims particularly? Because they face the greatest challenge right now. Unlike previous immigrant groups, they carry the identity and customs that some see as those of the enemy.”
DAKTOIDS: Two-thirds of the dentists in ND are bunched in four counties with the largest cities. Some Indian reservations and rural counties have no dentists . . . A plant near Beulah converts lignite into natural gas. An adjacent plant costing $500 million is under construction and will convert byproducts from the natural gas plant into urea pellets to fertilize wheat, soybeans and corn.
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