This time, it’s different.
That was the pitch from a new economic development organization to the Rapid City Council on Monday when they asked the Rapid City government for $2 million over the next five years in an effort to create nearly 5,000 jobs and attract $300 million in new business investment to the area by mid-2023.
The group, Elevate Rapid City, was unveiled in April as a collaborative umbrella organization including the Rapid City Chamber of Commerce, Rapid City Economic Development Partnership, Ellsworth Development Authority and Economic Development Foundation. A host of area businesses including Black Hills Corp., Black Hills Energy, Scull Construction and Montana-Dakota Utilities Co., have also made varying undisclosed contributions to the organization. At the April 10 announcement, the group said it had raised $3 million toward its goal of $4.25 million in private-sector funding. On Monday, it was up to $4 million.
Now, they’re looking to Rapid City and Pennington County for help.
At Monday’s presentation, David Lust, a co-chairman of Elevate, partner at Gunderson, Palmer, Nelson and Ashmore, LLC, and a state Representative for District 34, noted Rapid City and western South Dakota’s characteristic independence and skepticism at such ideas before expressing excitement at the initial signs pointing toward overcoming the doubt.
“Cracking the nut in Rapid City has been quite a challenge,” Lust said. He added that the initiative’s momentum had picked up quickly since they started the preliminary stages in June 2017 and that the organization would utilize data-driven benchmarks to ensure Elevate was held accountable.
“It’s a collective effort to improve our economic well being in this community,” Lust said of Elevate’s mission. “It’s about accountability and reporting. We should report to the community what Elevate has done.”
Behind the scenes, Elevate has been in the works since April 2016, when the Rapid City Chamber of Commerce visited Sioux Falls for their annual retreat and learned about Forward Sioux Falls, an economic development initiative that began in 1987 and has raised more $52 million since its inception.
More than a year later, in June 2017, a workshop with Convergent Nonprofit Solutions — an Atlanta-based company specializing in economic development and nonprofit fundraising efforts — led to 62 confidential interviews between community leaders and Convergent’s Rapid City team about the opportunities and challenges Rapid City’s business community and economy faces.
Elevate Rapid City’s prospectus and five-year plan was the result.
In Monday’s presentation and in a Journal interview Thursday, Convergent’s Rapid City team — Lawrence McKinney and Elizabeth Hennen McKinney — said benchmarks including per capita income, job growth and new business investment would be tracked monthly and reported each quarter and year. Some reports would be disclosed only to investors but a “community baseline scorecard” would also be released to the public with results. Rapid City’s per capita income compared to the U.S. per capita income was the largest indicator Elevate would track, McKinney said
“The purpose of Elevate Rapid City is all about that red line,” he said, referencing a powerpoint slide tracking Rapid City’s per capita income with a red line alongside that of Sioux Falls, Pierre, and the United States.
“That’s what chambers of commerce and economic development groups are paying attention to. How is our economy doing, how are we doing compared to others and are we going in the right direction? Everything that Elevate is about, that the community and this leadership has put together, is about moving that line.”
Using the latest figures, Rapid City’s per capita income was at about 96 percent of the U.S. average in 2015, the graph showed. Sioux Falls was just over 105 percent. Pierre was at about 102 percent.
McKinney noted that the ideal range is between 105 to 110 percent, leading to better economic growth and quality of living. Anything higher, like in Alexandria, Va., where the per capita income is near 130 percent of the U.S. average, and the cost of living begins to skyrocket, McKinney said.
Elevate’s main strategy is comprised of four main components: create high-paying jobs by incubating and growing local startups, support the growth of Ellsworth Air Force Base, improve the skills of the current and emerging workforce, and improve Rapid City’s business reputation.
To achieve those broad goals, the strategy notes activities like supporting the city’s new innovation center, increasing the business community’s engagement with the South Dakota School of Mines & Technology and the Sanford Underground Research facility, and improving programs for childcare, housing and licensure reciprocity for military families. Initiatives to create a STEM-based pipeline of work-ready students utilizing high school votech programs and the area’s secondary school resources — Mines, Western Dakota Tech, National American University and Black Hills State University — and to focus on attracting high-paying industries in the financial, health care, research, manufacturing and energy sectors, are also noted.
Elevate hopes such actions will create more than 2,000 jobs with an average wage of $29.13 per hour and another 2,500-plus jobs with an average wage of $17.79 per hour. With a sizable amount of area citizens either unemployed or underemployed, by creating job opportunities to meet their educational background and expertise, opportunities for the less skilled and educated workers would then open up, helping to elevate all of Rapid City and not just making the rich richer, McKinney said.
Though Elevate is still in its infancy, the next three months will determine much of its future. Bylaws will be drafted and adopted in July, and officers will be recommended. In August, the first board meeting will be held at which the bylaws will be ratified and officers elected. In September, the first quarterly all-investors meeting will be held. At that meeting, Elevate will determine their plan for the next nine months as well as discussing a longer-range strategy.
For McKinney and Hennen McKinney, that means their work is almost done. For Elevate’s leadership and key investors, it is just beginning. Gathering financial commitments from Rapid City and Pennington County will be the next great hurdle. In a Journal interview, city spokesman Darrell Shoemaker said the city and mayor’s office had yet to decide upon a possible funding source for their contribution.
“It’s just a question mark at this time,” Shoemaker said.
But, the city’s Vision Fund has been discussed as a likely possibility. The county has yet to meet with anyone from Elevate’s team to discuss their role in the group but McKinney said he expects to meet with county commissioners individually in the coming month. Ideally, Elevate will hit the ground running with about $6 million in public and private funding, with McKinney saying there were about 35 more area companies he still wanted to meet with.
But, McKinney and Hennen Mckinney’s final message to Rapid Citians and government officials was simple: this kind of thing is done all over the country and will only continue with demonstrated positive effects. Though Elevate was only operating on a five-year plan for now, the goal with all economic development groups was to continue their efforts long into the future.
“We have to be successful,” McKinney said, “in order to carry on.”