Community Profile - Pierre, SD
By: Alan Van Ormer, Prairie Business Magazine

A diverse economy has kept the central South Dakota community of Pierre afloat, even in the midst of a recession that has blanketed much of the nation over the past few years.

Professional services, tourism, agriculture and state government jobs have helped Pierre become what many local officials say is one of the best kept secrets in South Dakota.

“I have heard Pierre described as a jewel on the prairie,” says Jim Protexter, executive director of the Pierre Economic Development Corporation. “Many evenings when returning to Pierre on (Highway) 83 going over that last hill, you see this cluster of city lights mixed with the emerald lights around Oahe Dam, and it does look like a jewel. We are proving that on the professional services and retail side we are able to grow and attract quality employers.”

Pierre Mayor Laurie Gill considers the city a gateway to the state because of the many dignitaries from around the world who visit the community because South Dakota’s state capitol is located in Pierre. The community’s close proximity to Native American reservations also adds a diverse cultural influence to the area.

“There is an ethnic mix and we very much embrace that,” Gill says. “We’re unique that we have state government in the community. It provides a stable force throughout any type of economy. State government is always here and operating.”

STABLE ECONOMY

With Pierre’s many industries, the community has remained stable despite the nation’s economic troubles. In spite of the recession, the community has not seen a decline in sales tax revenue. In fact, Pierre has actually displayed annual sales tax revenue increases in recent years. Gill said in June that the city’s 2010 sales tax revenues were running at more than 4 percent above last year’s total.

“That is a great indicator for us,” she says. “People are still coming into the community and spending money. We have weathered this recession well.”

Laura Schoen Carbonneau, CEO of the Pierre Area Chamber of Commerce, says chamber membership actually grew last year with the help of a person dedicated to serving members. The Shop Pierre First initiative was also launched.

“We wanted to help people understand that you don’t have to go out of town to purchase. We have very unique stores downtown,” Carbonneau says. “We need to encourage people to get past the assumption that it is not there.”

Pierre is home of the state capitol and many state government jobs. It has also helped stabilize the local workforce as many who have taken state government jobs have decided to settle down and stay in the community.

Lois Ries, the director of the local convention and visitors bureau, moved to Pierre 21 years ago when her husband got a state job. The couple had originally planned to move back east in a few years, but instead decided to stay. “Now we’re going to retire here,” Ries says. “It is a great community. Many come back, live and raise their families.”

Glennis Zarecky and her husband, Mark, have been operating Zarecky’s Midwest Construction and Development in Pierre for 29 years. The company is currently involved in the planning stages of a large townhouse project.

“As a contractor, we know there has been a slowdown in parts of the construction industry in town,” she says. “But because of Pierre’s economy being so stable, fortunately there aren’t construction businesses closing down that I am aware of. We are as busy this year as we have ever been. We are not seeing anything negative in the economy.”

TOURISM STRENGTH

Tourism is one of the area’s main economic drivers. There is fishing along the Missouri River that runs through the middle of Pierre and Fort Pierre, located on the western banks. In addition, the area offers abundant pheasant and other types of hunting.

“We do well in the recreational area,” says Blake Barringer, vice president of Brosz Engineering Inc. “We need to find other things for people to do that isn’t hunting and fishing related. Not everybody wants to go out on the river.”

Pierre has lost some major conventions because of the economy. But the local convention and visitors bureau has shifted gears and has been able to book conventions over the next two years because of its centralized location. “We work really hard to get those meetings to come here,” Ries says.

To assist with hosting conventions, a 4,500-square-foot Clubhouse Inn & Suites is planned for Pierre. The new facility will have 80 rooms and a restaurant. Across the river in Fort Pierre, a Perkins restaurant and Dacotah Prairie Bank have recently been built.

HEALTH CARE EXPANSION

St. Mary’s Healthcare Center, which employs 475, is the second largest employer in Pierre.

In 2000, St. Mary’s completed a $12.5 million building project to upgrade its services for patients in the emergency room, same day surgery and operating rooms. Four years later, another $12 million addition was completed to house transitional care, kidney dialysis and rehabilitation. The health care facility also partnered with Capital University Center on a $3.4 million education facility that contains a nursing laboratory and four classrooms to assist with nursing shortages.

“A great number of our nurses are homegrown,” says Ellen Lee, vice president of outreach at St. Mary’s Healthcare Center. “They stay or come here to be trained. The major shortages the rest of country is experiencing, we have already figured how to keep that from impacting us.”

STATE GOVERNMENT INFLUENCE

Another piece of the economic puzzle is state government.

Kim Olson, director of the South Dakota Governor’s Office of Economic Development, says the GOED has an excellent relationship with the city of Pierre, as it strives to develop with all communities in the state.

“These relationships are mutually beneficial for both the state and the communities as we grow and diversify South Dakota’s economy,” Olson says. “State, city and local leaders worked closely in the last several years to help locate Eagle Creek to Pierre, bringing high tech jobs to the area. It’s this kind of collaboration that helps move this state forward.”

CHALLENGES REMAIN

Despite the community’s economic strength, there are challenges ahead.

Pierre continues to add more jobs. One of the concerns when adding new jobs is meeting the housing needs of those moving into the community. Medium-range priced apartments for those who might not be ready to purchase a house are one of the community’s major needs, as well as low-income housing.

“The more immediate need is for apartments,” Gill says. “We are trying to work with the private sector to invest in apartment complexes.”

Two new apartment complexes were recently constructed — the first new apartment buildings added in the community in more than 20 years — but more are needed to meet future growth projections.

Along with housing needs, there is a labor force challenge, especially in the service sector. There is also a challenge in the nursing home segment of the community.

“Our attached nursing home, similar to nursing homes across the country, struggles to attract and retain certified nursing assistants,” Lee says. “The past year has been especially difficult in attracting new talent to these entry-level nursing positions.”

SIGNS OF GROWTH

A $10 million airport terminal is being constructed. Butler Cat is expanding and making Pierre its central agriculture headquarters in the state. Last year First National Bank added 7,800 square feet of space, turning a one-story bank into a two-story facility, improving the lobby and waiting area and installing an elevator to meet ADA requirements.

Minnetonka, MN-based Eagle Creek Software Services has added 50 new employees and is looking at adding 30 more at its business intelligence facility in Pierre. The company specializes in implementing and integrating Oracle customer relationship management software for Fortune 2000 clients.

In Harrold, SD, a small community half an hour from Pierre, an $8 million elevator construction project is being completed. Many of the facility’s employees live in Pierre.

A storefront improvement project is also under way in Pierre. The community provides a 50 percent matching grant for businesses on Pierre Street to help redevelop downtown. To date, nine businesses have expressed interest.

Part of Pierre’s economic growth revolves around public and private ventures. During its strategic planning sessions, the Pierre City Commission decided that one of its guiding themes would be trying to partner with the private sector to complete projects.

“There are things many groups are asking us to do that we couldn’t do alone with our funds,” Gill says.

The city commission set guidelines. If the private entity was willing to raise 80 percent of the funds, the city would consider chipping in 20 percent.

So far the public-private partnership has worked in at least two instances. A $630,000 remodeling of the Hillsview Clubhouse and Pro-Shop is a partnership between the private sector and the City of Pierre. The community has raised an estimated $504,000, while the city is providing $126,000 for the project.

Opening a regional distribution center for the Food Bank in cooperation with Wal-Mart is another example. The first shipment of food went out in June to be used for nonprofits and food pantries to serve people.

SISTER CITY COLLABORATION

Another partnership that stretches across the river between Pierre and Fort Pierre is as old as the history of central South Dakota itself.

“We have always worked together,” says Dave Bonde, executive director of the Fort Pierre Development Corporation. “We are sister cities, but we are definitely independent identities.”

Local officials say it is important for the two communities to work together because they are able to share resources, professional expertise and volunteers. “Small communities survive on volunteers,” Bonde says.

Pierre is able to provide Fort Pierre with resources and professional expertise. “Having Pierre as the seat of state government is an unbelievable resource,” Bonde says. “Having the Governor’s Office of Economic Development across the river is also pretty nice.”

On Fort Pierre’s side of the river, businesses help draw business to its sister across the river. One major business, Fort Pierre Livestock Sale Barn, is one of the largest of its kind in the Midwest and has also been ranked as the nation’s top sale barn. “That’s big for the businesses of Pierre,” Bonde says.

The mayors of Pierre and Fort Pierre have also displayed a willingness to work together. Gill and Mayor Sam Tidball of Fort Pierre are good friends and are also aware that the two communities need to collaborate to get things done.

“We’re finding that in order to get major projects accomplished, it is best to do it with a cooperative effort,” Bonde says.

Van Ormer, a former Madison, SD-based freelance writer, is the new editor of Prairie Business. He can be reached at avanormer@prairiebizmag.com.