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Fargo Supports Lowe’s Point on Downtown Development

In the Democratic gubernatorial candidates' forum on SDPB last Thursday, candidate Joe Lowe recommended that the Governor's Office of Economic Development redirect some of its grants from big corporations to South Dakota's small towns to help them revitalize their downtowns. Lowe pointed to Main Street Square in Rapid City, where regular events create a shopping and tourism destination that's boosting business.

Regular readers know that I'm all about big-thinking economic development policy that looks past the traditional, unreliable corporate-welfare model. So, apparently, is Fargo, where downtown development is drawing youth, creativity, and entrepreneurial spirit. The Minneapolis Star Tribune's profile of Fargo's downtown success discusses young Fargo entrepreneur Greg Tehven's passion for his stereotype-busting hometown:

Tehven’s Fargo is the five-block radius of downtown; a vibrant community of artists, tech entrepreneurs, college kids and possibilities. Once hollowed out, the downtown is now crowded with coffee shops, restaurants and quirky shops that draw in crowds of strolling pedestrians and cyclists.

Tehven’s Fargo is one of the nation’s fastest-growing cities [Jennifer Brooks, "Fargo Reinvents Itself as a Magnet for Creative Types and Entrepreneurs," Minneapolis Star Tribune, 2014.06.01].

We discussed that population growth last week, when we noted that Fargo ranks seventh for population growth among the nation's cities, ahead of booming #11 Sioux Falls.

What's it feel like to be in charge of economic development in Fargo?

“You feel like you died and went to heaven, ” said James Gartin, president of the Greater Fargo Moorhead Economic Development Corp. — the man in charge of encouraging economic growth in a place now ranked as the best place in America to find a job, the country’s third-safest community and its fourth-fastest growing metro region.

“It’s electric,” Gartin said. “It’s just an incredible time to be in this market. Not only with the business growth, but we have this incredible entrepreneurial ecosystem” [Brooks, 2014.06.01].

Fargo's good fortune spills across the Red River to Moorhead, which is growing even faster. Moorhead has hamstrung its downtown development but enjoys other advantages from which South Dakota might learn:

Rather than focusing on downtown revitalization — a difficult proposition, since a large swath of downtown Moorhead was razed to make way for a mall — Moorhead cultivates the image of a politically progressive, family-friendly college town. It touts its schools, its close-knit neighborhoods, its public funding for the arts, its parks and green spaces — in short, its Minnesota-ness [Brooks, 2014.06.01].

Economic development is much, much more than handing money to big corporations. Fargo and Moorhead get that. Joe Lowe gets that. Why don't Dennis Daugaard and Mike Rounds get that?


  1. Steve Sibson 2014.06.02

    I am not surprised to read that Lowe is also a Crony Capitalist.

  2. caheidelberger Post author | 2014.06.02

    Steve, you're not helping. Back off.

  3. Michael B 2014.06.02

    I am not worried about Sioux Falls and Rapid CIty. They can take care of themselves. I am worried about the state wasting a chunk of change on projects that are doomed before they ever start. It has to work out on paper BEFORE you write the check. That's the way banks lend money to businesses.

  4. Roger Cornelius 2014.06.02

    Main Street Square in downtown Rapid City has surpassed its expectations and has not only brought economic development opportunities, but it has developed a sense of community.
    Before the square downtown was dead from Saturday afternoon through Monday morning. Now it is busy 7 days a week.
    South Dakota's problem with economic development is that for the most part it restricts itself to agriculture, tourism and manufacturing.
    Arts and entertainment are also economic development, movies and television make millions, but South Dakota has not advanced in this lucrative industry.
    And the state is ignoring the most immediate opportunity for economic development and that is Medicaid Expansion.

  5. Chris S. 2014.06.02

    Why don't they get it? Because not getting it allows them to shovel public money at their corporate friends.

    This has been another edition of Simple Answers to Simple Questions. [trademark Atrios]

  6. Wayne Pauli 2014.06.02 took the words right off of my fingers.

  7. Steve Sibson 2014.06.02

    Sorry Cory, but the truth needs to be known...crony capitalism is a collectivist policy position and is not a component of conservative thought.

  8. caheidelberger Post author | 2014.06.02

    Steve, stifle it. Your hobbyhorse recitations don't help anyone analyze and understand the ideas of downtown development that we are getting from Rapid City and Fargo, nor the Minnesota mindset of investment in public goods represented in Moorhead.

  9. Steve Sibson 2014.06.02

    "Your hobbyhorse recitations don't help anyone analyze and understand the ideas of downtown development"

    I am getting first hand understanding of downtown development here in Mitchell where the city's debt ceiling has been maxed out. From my vantage point, it is easy to see who is benefiting the most. All you have to do is look at who is heading up the Mitchell Chamber of Commerce and Economic Development boards.

  10. Lanny V Stricherz 2014.06.02

    Steve brings up a good point. "Mitchell's debt ceiling has been maxed out." Sioux Falls, has over 400 million in debt on the books with more coming with the Indoor Water Park. It is sitting on 30 some million of the 40 million in Highway money, (????) that it got for moving the railroad tracks in downtown Sioux Falls, nearly 10 years ago.

    Meanwhile our Federal Government, from which Sioux Falls got that 40 million in highway money, sits with more than 17 trillion on the books. South Dakota has, who knows how many billions in various accounts. But we have folks all over the country claiming that we need to balance the budget. Which of the three aforementioned budgets is balanced?

  11. Danno 2014.06.02

    Main Street Square is awesome in Rapid, it's worked really really well for us! Downtown is a destination now!

  12. Douglas Wiken 2014.06.02

    The Rapid square makes little sense. Downtown Rapid needs parking for existing business and that removed parking.

    The square should have been elevated above a street level parking area and the elevated area should have been connected around Rapid with elevated walkways and bicycle and small electric vehicles tracks separated from traffic. Rapid City then would have had something that was on the front end of development instead of half catching up with NYC Central Park of 100 or more years ago.

  13. Tara Volesky 2014.06.02

    Steve Sibson is 100% correct. Many communities in SD are run by special interest groups that push projects, paid for by the taxpayers of your community, that benefit the few. The mayor gets elected by the puppet masters and media who, distort the truth. In turn, these puppet masters call the shots and get their projects built with sometimes no bid contracts. Where do you think they learn it from. Just check out our crony capitalism in Pierre. They are all connected. Have you ever heard about these town's good old boy clubs. Seriously Cory, this goes on in many communities. Just ask the people. Thanks Steve for telling the truth, even if it is uncomfortable. There is so much cronyism going on in Mitchell, I could write a book. The only people to blame are the media, the phony Politicians and the people who vote for them.

  14. John Tsitrian 2014.06.02

    Main Street Square got off the ground with $7 million bucks, about half coming from RC's Vision 2012 fund (a city sales tax dedicated to community recreational improvements and about half from private donations. Also, a self-taxing Business Improvement District encompassing the downtown area raises something like $175k/year, which has been spent on Main Street Square until this year, when it will be diverted to other projects because, apparently, MSS can now support itself (not sure how revenues and expenses are worked out, but apparently it can now stand on its own). I think SD state money moving into this project would have set a bad precedent on a couple of fronts. Self-funding it put the whole burden of marketing and development on the stakeholders in Rapid City without having to deal with state regulatory and oversight issues and any other forms of public and private sector meddling. More pertinently, other cities would be soon clamoring for similar considerations from the State of SD, and I have no doubt that a lot of white elephants, putting money into the pockets of developers and local investors, would be created. If anything, RC should work as a model for other cities that want to develop a well-focused and marketable city center. If they're that determined, the money should be raised and risked locally, not doled out by state residents who have no inclination nor reason to support city centers that could very well be constructed on the basis of very iffy and self-serving marketing "research."

  15. Deb Geelsdottir 2014.06.02

    The arts are a proven economic development engine. Taos, New Mexico would not be on the map if not for arts. Neither would Hill City. Developers are building or refurbishing old, empty buildings into arts communities as fast as they can.

    Artists eat, drink, sleep, play like anyone else. So do the people who come to their galleries and shows. So do the builders, the management types, the service people, etc. Restaurants and coffee shops sprout, in addition to retailers who sell supplies, equipment for metal sculptures, etc.

    All those people raise families, which need so many things.

    The biggest drawback for artists in SD is the state sanctioned homophobic discrimination

  16. John Tsitrian 2014.06.02

    DW, though I disagree with your assessment of how things are going for Rapid City's MSS, I think we can both conclude that if there's a problem, it's Rapid City's problem, not the State of South Dakota's. This is why I don't go along with Lowe's notion that state economic development funds should be directed at cities.

  17. Deb Geelsdottir 2014.06.02

    (As I was saying . . . )

    The biggest drawback for artists in SD is the state sanctioned homophobic and racial discrimination and general parochialism. Those severely darkens SD's welcome and turns the nice smile on promotional media into a snarl.

  18. Lanny V Stricherz 2014.06.02

    And you said it so well Deb. I found myself nodding as I read your post, until I got to the last line. You are so right. Between that and the South Dakota legislature's attitude toward women, I would bet costs the State 20 to 30% in tourism.

  19. caheidelberger Post author | 2014.06.02

    John, should your "keep it local" thinking on downtown development apply to industrial development as well? Doesn't subsidizing a cheese factory in Brookings open the same unwanted regulatory and white elephant doors that you worry would accompany Lowe's grants to enliven Main Streets?

  20. Lanny V Stricherz 2014.06.02

    John, while I agree with you on, that State dollars should not go into advertising this or that city, I do find it unreal, that the State advertises fishing, hunting pheasants, and the Black Hills the way it does, and ignores what I started calling the best kept secret in South Dakota last fall, when I visited there, the Hot Springs area, including Wind Cave Natl Park, Devils Plunge, The Wild Horse refuge and of course the Mammoth site. To think that the State would risk that treasure as a tourist attraction that they have done nothing to develop or promote, by allowing Powertech to reopen Dewey Burdock, is unconscionable.

  21. I watched Brookings go from having a strip club on their downtown main street to being the epicenter of Brookings as it should have always been--within a decade. As awesome as Greg from Fargo and his ilk are (and we have our own in SD like this), much can also be learned from smaller towns like Brookings. I knew I liked Joe. Woot!

  22. Roger Cornelius 2014.06.02

    There are always the nay sayers and the they shoulda crowd when it comes to successful projects like MSS in Rapid City. Can you imagine just how unsightly an elevated city square would be?
    Rapid City does have a parking problem, Rapid City has always had a downtown parking problem, no news there. The MSS hasn't taken up that much space for the return it is getting, expansion plans are being made with the parking problem in mind. The parking problem is by the most part caused by owners and employees that could easily car pool to work and save space for their customers.

    John Tristan's summary is perfect MSS is ours with nothing hanging over us but critics who don't like anything.

    Yes, local vendors and contractors made money off this project and maybe there was some cronyism in the funding. The thing is that someone will always whine about who made money and who could have done it better. But, like I say MSS is ours and we are immensely proud of it.
    The best part of MSS is that it brings the community together, not just in the summer months, but all year long.

  23. Deb Geelsdottir 2014.06.02

    My best buddy lives and works in RC and loves alll the stuff that goes on year round at MSS.

  24. John Tsitrian 2014.06.02

    Cory, I don't think that industrial development and community revitalization are comparable. The state, whether we like it or not, has to compete with other states for business, so there's a place for aggressive competitive incentives--consider the way Texas snatched a big Nissan complex away from CA just recently--that could lead to industrial development. So far, I'd say SD's efforts have been a giant floppola, but that doesn't mean the concept is no good. Having a hand in the development of various downtowns throughout the state is a non-starter for me just because efforts like that seem likeliest to succeed if they're conceived and funded by locals who know their territory and have personal stakes in their outcomes. Lanny, the allocation of tourist promotion dollars (which for the most part are raised by tourist businesses through their own taxes) has always had strong regional inputs. While I get your point that the southern Hills don't get anywhere near the marketing they should, the tourism taxes generated from there are puny compared to the funds raised in the central and northern Hills. You can see it in the number of pages allocated to each section in the South Dakota Vacation Guide. Long ago, when I was just testing the local waters, an old hand told me that SD's target markets for big time media exposure were always to the east or southeast, so that travelers would enter the state via east river ports, go to the hills, then turn around and revisit the eastern towns. If marketing were done to the west and southwest, it was feared that tourists would come to the Hills then turn around and go home without venturing to eastern South Dakota. The southern hills sites you mention are great attractions, but just don't muster up the money to get much more attention than they do from SD marketing forces. Kind of a cruel marketing triage, but that's the way the system is set up.

  25. grudznick 2014.06.02

    I notice, Ms. Geelsdottir, you said "best buddy" and not "best girlfriend." Does he take you dancing at all the swellest places down there on Main street?

  26. Deb Geelsdottir 2014.06.02

    Why Mr. Grudz! I do believe you are trying to get fresh with me! I will have to call my chaperone to have a word with you. You sir, are a cad!!

  27. larry kurtz 2014.06.02

    Little activity on the internet is more rude and inappropriate than a pseudonymous troll harassing a named commenter.

  28. Chris Francis 2014.06.02

    Main Street Square was smart, very smart, seems like each time I'm in Rapid, 4 times this past year, that's where I end up, eating out, visiting one of my new favorite bike shops, or Tandy, the Dahl, galleries, on from that, such thoughtful downtown planning is a good thing, and one in this instance, that has and will continue to pay it forward for RC. Copying that plan of success is a great path forward for other communities to investigate and dig into.

  29. Douglas Wiken 2014.06.02

    An elevated square could be beautiful and also would be a bit out of street noise. Perhaps I have not been in RC at the right times, but have never seen more than a handful of people down there. It is one huge missed opportunity.

  30. Danno 2014.06.03

    With all due respect to the previous poster, a visit last night to "movies under the stars" would have shown him a very large crowd, the square was packed from 6pm on till past 10, with the shops that were open getting heavy traffic. The weekends are typically packed as well with the special events going on. Try a Friday afternoon when they have jam sessions in the square.

  31. larry kurtz 2014.06.03

    Sib: how often do you change your voter registration?

  32. Chris Francis 2014.06.03

    Not sure when you're visiting Douglas, but my encounters has seen that square just packed, ice rink in the winter with music and lights, hockey practice and skating lessons, summer with the work on the sculpture, and the dances and concerts, the water feature, that's gotta be some of the hardest working real estate downtown for what it offers, just a huge magnet and incubator, that's only growing stronger. Smart planning, and a small space too.

  33. Roger Cornelius 2014.06.03

    There are always traffic laws in any venues, I've been in the Rushmore Mall when it seemed like an echo chamber.

    Any elevated square will never happen for a couple of reason, Rapid City has an aversion to anything higher than the Alex Johnson, the city won't even seriously consider a bridge over Omaha St for foo traffic.

    The vicinity of MSS also has multiple areas for addition, including the renovation of alley's.

    An additional feature of MSS is the Sculpture's Project and the increased traffic from the presidents statues scattered throughout downtown. The presidents statues are far more popular than I thought it would be.

  34. Lanny V Stricherz 2014.06.03

    Roger, To your point:

    Scheels recently opened their expanded south entrance of the Store. For those who have never been there, The north entrance to the store has life size bronze statues of Abraham Lincoln and Ronald Reagan. The new south entrance added George Washington and Thomas Jefferson. This really seems strange for the two at the north end, because they replace Teddy Roosevelt with Ronald Reagan. So even though RR has not made Mount Rushmore on the west end of the State (yet), he replaced the most outdoorsman President we have ever had, Teddy Roosevelt on the East end of the State, at a store that wants to be the top outdoor store in the State.

  35. Roger Cornelius 2014.06.03


    By Scheels putting Reagan in front of their store is showing that not so subtle Republicanism.

  36. Lanny V Stricherz 2014.06.03

    My point exactly, Roger.

  37. Les 2014.06.03

    """""the city won't even seriously consider a bridge over Omaha St for foo traffic."""""
    They we're hell bent for a bridge, just didn't want to pay for it and DOT or the rest of us wouldn't either.

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