Headwaters Economics

MT, United States

Headwaters Economics

MT, United States
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News Article | April 27, 2017
Site: www.forbes.com

How are communities across the American West changing? Where are the growth opportunities and risks? If you’re an entrepreneur or policymaker looking to the future of the region, pioneering Headwaters Economics may be a key ally for you. Here, Keith Hammonds, President of Solutions Journalism Network, catches up with Ray Rasker, Headwaters founder and CEO, to learn why. Keith Hammonds: Ray, can you first tell us how Headwaters got started? Ray Rasker: We felt there was room for an independent, nonpartisan organization that would support decision makers with rapid turnaround research on rural communities. Think of the big challenges in the West and beyond – wildfires, energy policy, public lands – these are complicated issues with a lot of layers. Policymakers and entrepreneurs too often lack accessible data and analysis to help them make sense of the issues and what’s coming. So Headwaters has national tools that are easy, free, and tell you all sorts of incredible things, like the economic profile system and the populations at risk tools. They’re a huge timesaver. Hammonds: How does this play out in real life? Rasker: Take wildfires. This is a big, costly issue – the U.S. Forest Service and other federal agencies spend about $3 billion per year fighting wildland fires in the West and elsewhere as the fire threat spreads. That’s three times the amount from a decade ago. A lot of people know a lot about wildfires but the knowledge is compartmentalized, so we brought together 20 experts dealing with the issue in a closed-door solutions forum in Jackson, Wyoming, with no press. We looked closely at all the data and arrived at 10 creative solutions including one that provides planning support to help communities significantly reduce fire risk. We followed up with a pilot study, and a year later came back to federal policymakers and said, “Here’s what this looks like on the ground.” The planning support idea is now our Community Planning for Wildfire program and being implemented in 17 communities in the West. Hammonds:  Let’s talk about the reigning economic narrative of the West that is anchored in the decline of extractive industries and resulting dislocation of jobs. Is this the right narrative? Rasker:  No, it’s not where the big numbers are. Less than five percent of personal income in the rural West is from mining, oil and gas, and timber. But the perception is that it's much, much bigger than that, right? So this narrative that the West is resource dependent has hijacked the conversation we should be having, which is: why are some places thriving while others are declining?


News Article | June 6, 2017
Site: www.theguardian.com

If you want to appreciate the prairie landscape that inspired President Theodore Roosevelt to set aside 230m acres as national land, you have to pull off the interstate somewhere in the Dakotas, or in the eastern third of Montana, Wyoming, or Colorado. Follow a dirt road for a few miles, roll down your windows, and shut off your engine. Do this almost any time of day, preferably in springtime. Above and below ground, the prairies are humming with life: birds, rodents, snakes, pronghorn, badgers and coyotes, rioting amid a landscape of grass and sagebrush. A patchwork of public land comprises large blocs of this splendid and sparsely populated terrain, and while much public ground has the appearance of a nature preserve, it is mostly a working landscape. Public forage, timber, and water resources sustain thriving wildlife populations, along with millions of livestock and thousands of agricultural producers. For these people and their communities, public land isn’t a destination on a bucket list, a recreational playground, or a studio for Instagrammers – it’s a source of life to which they’re intimately connected. That’s why many ranchers are unnerved by the Republican party’s land transfer agenda, which aims to give away as much federal public land as possible to the states. While the movement gains traction among the Republican cadre, its attractiveness to rural westerners is less certain, and if it ever succeeds, it will mean a radical restructuring of the foundations of the economy and the culture of the west. There is a hardcore element within the growing land transfer movement, represented most garishly by the Bundy clan from the Mormon stronghold of Bunkerville, Nevada, who owe more than $1m in unpaid federal grazing fees, and who blackened the image of anyone with a cowboy hat when they staged an armed takeover of a national wildlife refuge in Oregon last year. The Bundys and their acolytes don’t believe the federal government has the right to own any land aside from military bases, but their militant, extremist position is a sideshow. The most powerful champions of land transfer wear business suits and woo industry and urban conservatives with a simple pitch: states understand their own resources better than the feds, and they’d do a better job of managing timber, livestock, petroleum, and mining leases for the benefit of the state economy and local communities. For several years, the Utah congressman Rob Bishop, chairman of the House natural resources committee, and the lobbyists attached to the American Lands Council (ALC), a not-for-profit group founded by the Utah state representative Ken Ivory, have been preaching the land transfer gospel. In July 2016, they won a major victory when the GOP officially added the land transfer agenda to the party platform. This happened despite an astonishing lack of research demonstrating that transferring land to the states would benefit anyone, industry included. And if money tells us anything, it’s that ranchers aren’t much of a consideration in the land transfer movement. The ALC is registered as a 501(c)4 not-for-profit organization, which means it is not required to share donor details, but it has been established that substantial funding comes from the billionaire Koch brothers, who are heavily involved in the petrochemical industry and openly committed to destroying the environmental regulatory apparatus. In the ALC’s marketing videos, Ivory enumerates the many ways in which environmental regulations and bureaucratic red tape prevent states from maximizing revenue from oil and gas, mining, and timber development. I reached out to the ALC’s headquarters, to ask how they expected land transfer to affect agricultural communities, but received no response. Even though agriculture is a key economic driver throughout the western states, Ivory and his fellow land transfer advocates barely pay lip service to ranchers. It’s not as if all is rosy on the range. Spend a half hour talking with a public land rancher in the west, and you’re likely to hear an earful about how the federal government’s regulatory straightjacket limits their ability to do what’s best for the land and for their businesses. Many ranchers are frustrated by litigation brought by environmental groups over alleged violations of the Endangered Species Act and the National Environmental Policy Act, which they say results in burdensome regulations that keep federal land agency officers tied up with paperwork instead of focused on rangeland management. Sage grouse – large, ground-dwelling members of the family that includes quail and partridge – are the rangeland management controversy du jour in Montana, where I live. In some instances, measures designed to boost grouse numbers have forced ranchers to reduce or eliminate grazing on public pastures they’ve used for decades. In other cases, they’ve been unable to implement noxious weed control and fire prevention measures, which they claim has made sagebrush habitat more prone to destructive fires and less healthy for wildlife and livestock. The same federal government helped restore the gray wolf to the northern Rockies and is still protecting a population of grizzly bears that has outstripped its government recovery goals. While environmental groups cheer the return of wild carnivores, ranchers in predator country worry about their calves and lambs becoming the next meal. None of these actions, however justified, have endeared the federal government to the western ranching community, which is overwhelmingly conservative and Republican. And yet, not one of the dozen or so ranchers I have talked to thinks that any of these headaches merit transferring federal land to the states. Quite the opposite: they all tell me that transfer to the states would create a maelstrom of uncertainty for their businesses. In the worst case, they say that transfer would push their communities, and their way of life, closer to the brink of extinction. There are about 22,000 public land ranchers in the west who hold grazing leases on about 250m acres of federal rangeland. They occupy a tenuous space in a livestock market dominated by huge corporate outfits in Texas, Oklahoma, and the midwestern states, and they often survive in challenging environments where short growing seasons, scarce water, and extreme temperatures and terrain are the norm. With all the variables at play – from increasingly unpredictable weather to fluctuating beef prices – there isn’t much margin for error in their financial planning. According to Jim Hagenbarth, 68, who owns a ranch with his brother Dave that spans the Montana-Idaho border and which has been in his family since the 1930s, land transfer advocates have not adequately addressed how state agencies would avoid destroying the grazing lease fee structure, which has been a bedrock of stability for western ranchers since the Great Depression. Under federal lease programs established in the Taylor Grazing Act of 1934, stockgrowers pay a monthly fee of less than $2 for each animal that they turn out on to leased ground during the summer and autumn months. Grazing fees on state land are as much as 20 times higher, and they vary from year to year based on several factors, including the market cost of beef. If ranchers with large federal leases were suddenly forced to pay state fees, Hagenbarth said, many of them would go under, and the resources and the wildlife they support would suffer in their absence. In addition to fees, ranchers take on out-of-pocket expenses to develop water, maintain fences, and fight weeds. “Weeds are the greatest threat to public land in the west,” he said. According to Hagenbarth’s calculations, those costs averaged $30 per animal over five years. “It costs one hell of a lot of money to do a good job. We don’t just turn the cows out and let ’em tear the hell out of it. We spray a lot of weeds,” he said. “It’s now to the point that the federal government should be paying you to graze the land, with all the costs we have to manage it.” In early May, Hagenbarth took me on a tour of several of the family’s pastures outside of Dillon, Montana, sandwiched between the Madison and Centennial mountain ranges, which still held snow almost down to the tree line. It was the peak of the spring “green-up”, when seasonal grasses flourish before going dormant and fading to a tawny gold. Herds of pronghorn grazed amid small clusters of black angus cattle. Mating pairs of mallard ducks swam in a watering hole that Hagenbarth built, and curved-billed curlews stalked the marshy banks on stilt-like legs. Hagenbarth, who graduated from Notre Dame University, where he played rugby, pointed out various strains of grasses – blue grama, needle-and-thread, Bozoisky, Vavilov – and explained the ways he and his family were trying to improve rangeland health, from new approaches to grazing rotation designed to protect riparian areas and stimulate grass growth, to weed management, to attempts to restore native grasses and reverse the legacy of Dust Bowl erosion that still haunts his pastures. His face, shaded by a wide-brimmed straw hat, was covered in ruby blotches – a side-effect of a preventive treatment for skin cancer. Hagenbarth’s tanned, gnarled hands, like his face, are a testament to a life spent in the sun. According to him, if transfer were to force ranchers off the range, the loss to western landscapes and communities would go beyond the disappearance of ranchers and their livestock, something that some environmental groups, like the Center for Biological Diversity, actively seek. “You need livestock, which do what the big bison herds did when you had the wolves and the Indians moving them around. You have to have some kind of grazing disturbance to keep the ecosystem healthy, but the American people don’t understand that,” he explained. Ranchers’ knowledge of the land they work on a daily basis – public and private – is also invaluable, according to Hagenbarth. “I’ve been here 68 years, and I know this place by the individual tree and the fish in a specific hole in the creek. Over a lifetime, you develop a land ethic for a piece of ground and you have a responsibility to manage it for society using the tools that nature gave you – from hoof pressure to grazing and fire.” Vicki Olson, 63, owns a ranch with her sister, Nancy Ereaux, 54, and their husbands, near the Canadian border in north-central Montana, on ground her Basque sheepherder ancestors homesteaded over a hundred years ago. She shares Hagenbarth’s concerns. Like most ranches in the semi-arid Missouri River Breaks region of north-central Montana, the Olson-Ereaux operation depends on large public grazing leases. Olson worries about what state ownership would mean for the cost of goods, determined by the expenses that go into delivering a full-grown animal to market. “Right now … you can’t lose that lease unless you abuse it or don’t pay, so we have a kind of guarantee there,” Olson explained. The promise of multi-generational leases gives ranching families everywhere the incentive to treat public pasture as their own. Interestingly, one of the biggest complaints ranchers make about land management agencies is that they are understaffed and underfunded, which means agents don’t have nearly enough time to make the rounds to local ranches. That not only reduces the two-way flow of beneficial information about management practices, but also allows negligent leaseholders to get away with damaging the range. In general, though, Olson said most ranchers wanted to turn over their property and its adjoining leases to kids or close relatives, and to maximize its productivity to ensure high resale value. Whether planning for a sale or for the next generation’s inheritance, investing for the long-term health of public and private rangeland is just good business sense. In contrast to the federal lease system, Montana state leases are 10-year contracts awarded to the highest bidder. “Someone can come in and bid you way up, and then they can withdraw, and they don’t have to meet that bid, and you’re stuck with it ... That would be really hard on ranchers,” Olson said, sitting on the porch of her modest ranch house, a couple hundred yards from the red-roofed homesteader cabin in which she grew up. In tough times, or when people don’t expect to hold on to a piece of ground, they try to get as much out of the resource as possible in the shortest amount of time. And since the Taylor Grazing Act’s rangeland protections don’t apply on state ground, there is no regulatory mechanism to prevent abuse. “What the state will find is that someone will come in and bid way up on it, farm the ever-loving heck out of it, trash it, and then turn it back.” Chris Mehl, the policy director of Headwaters Economics, a Bozeman-based research firm, told me that the concerns of ranchers like Hagenbarth and Olson were entirely valid. “All state lands in the west other than state parks have a mandate to be utilized to maximize return,” he explained. That means a rancher could be kicked off a piece of ground if the state couldn’t demonstrate profitability from the lease, or if there were a promise of a higher return from another activity. In the event that a piece of state land didn’t cash-flow, the state would be legally obligated to sell it – a worst-case scenario that would open the door to massive development. By contrast, the multiple-use mandate of the federal land management agencies means no user group claims priority, and there is no requirement for federal lands to remain in the black. Land transfer advocates claim state ownership would be better for business, but Mehl disagrees: “We look at rural western counties, and the ones with a high percentage of federal lands are outperforming the ones that don’t have it.” Additionally, Mehl said, “there are enormous costs that would be incurred by states, and, in almost all of them, you’re not allowed to deficit spend, which the federal government does every year regardless of who’s in power.” Those costs would include hiring thousands of personnel to fill the roles of federal range managers, research scientists, law enforcement, and all the staff who support them, not to mention the unfathomable expense of fighting wildfires. Wildfire management alone currently costs the federal government over $3bn annually and amounts to roughly half of the US Forest Service budget. How would western states, which are already facing budget shortfalls, suddenly generate revenue for additional hundreds of millions of dollars worth of expenses? Ethan Lane, the executive director of the Public Lands Council, a project of the National Cattlemen’s Beef Association, which represents stockgrowers who hold public land grazing permits, told me: “Wholesale transfer of public lands could have a tremendously destabilizing effect on the western cattle industry.” If state land were ever to go up for auction, Lane said, it’s unlikely ranchers in areas with high scenic and recreational values would be able to compete with real estate developers. Subdivisions and trophy homes would replace production agriculture in places like the Big Hole Valley, where Hagenbarth lives, which boast the sort of mountain views and that millionaires drool over. Jay Bodner, the natural resources director of the Montana Stockgrowers Association, which represents about 2,000 ranchers across the state, told me that his organization’s current position is that ranchers would be “better off trying to work with [federal] agencies” to solve management problems. “There are complexities with a lot of these issues, and by simply moving them from federal to state – those complexities will still be on the landscape,” he said. Across Montana’s southern border, Jim Magagna, executive vice-president of the Wyoming Stock Growers Association, told me something similar. “We have not come out in favor of the transfer. We have not opposed it. But we’re certainly not advocates for it.” Leo Barthelmess, a sheep rancher, former director of the Montana Stockgrowers and neighbor of Vicki Olson, put it more simply: “We’d just be exchanging one landlord for another.” From the perspective of the public land rancher, the economic case against land transfer seems clear enough, at least in the context of my home state of Montana, where public land comprises almost 40% of the state’s land mass. But the more time I spent with ranchers on both sides of the political aisle, in various parts of the state, the more I began to wonder if the focus on economics might be a distraction from the cultural and ecological arguments for keeping ranchers and livestock on public land. When I visited Vicki Olson and her husband, Darryl, 65, at their ranch in early May, Vicki asked me if I was interested in attending a calf branding the following morning. She gave me directions to the French Ranch that didn’t include any road names, but consisted instead of phrases like, “When you see the old church on top of the hill, turn left at the next dirt road,” and, “It’ll be the only turnoff that looks like it’s been recently used after you cross the creek.” I camped for free that night on a patch of Bureau of Land Management ground beside a stock pond. A crowd of people showed up the following morning to help Bill and Corky French, their son and daughter-in-law Craig and Conni, and their grandson Wayne brand more than 600 calves. About 25 friends, relatives, and community members, including a local schoolteacher and a BLM employee from the local office, pitched in throughout the day, stopping every so often for a cookie or a cup of coffee. What at first appeared to be mayhem was actually skillfully executed teamwork that required almost no direction. Men and women on horseback lassoed calves by the hind feet and dragged them to the center of the corral, where they were quickly tackled to the ground by teams of two, restrained, inoculated, branded, and castrated. There was no distinction between men’s and women’s work, and everyone from grade school kids to grandparents seemed happy to pitch in and help. Some folks had traveled from hours away. By the end of the day, close to sunset, I was totally worn out. Craig French’s mother, Cork, had prepared a feast of barbecue, potato salad, and fresh-baked pies, which she served in an old camper trailer parked at the entrance of the pasture. “We’ll be doing this every weekend for the next month or so,” Olson told me. She said that she and Darryl regularly helped friends who live as far as 30 miles away, and that they wouldn’t be able to survive without the help of others. “If your neighbor thinks you need something, they supply it without being asked,” she said. In addition to helping with brandings, community members go in together on expensive equipment and help each other trailer stock to auction. When Olson’s aunt died in the middle of this year’s calving season, neighbors checked on their heifers day and night while the Olsons attended to family business. “I think we have a pretty unique community,” she told me. I thought about a conversation I’d had with Ralph Maughan, a member of the Board of Directors of the Western Watersheds Project (WWP), a conservation group firmly opposed to public land grazing. Years before, I’d spoken to Maughan – a retired political science professor – for a story I was working on about wolves, and I had appreciated his insights. The gist of the WWP’s position on public land ranchers was their output represents a minuscule fraction of US beef production, and they do more widespread and lasting damage to public land than any other user group. If public land ranchers were to disappear entirely, Maughan said, they would not be missed by the broader cattle industry, and it would be better for wildlife and rangeland habitat. In the aggregate, I couldn’t really argue with Maughan’s broader logic – perhaps it was true that most public land grazing allotments occupied ground that would be better off without livestock, like the cholla and saguaro deserts of Arizona and the Great Basin of Wyoming. At the same time, the argument seemed to denigrate the place of ranchers on public land. Here was a group advocating for termination by legislative fiat of an embattled, marginal community, and one with a strong culture based in a traditional livelihood that was more or less sustainable. I ran Maughan’s comments past Dave Pyke, a research ecologist with three decades of experience who works for the US Forest and Rangeland Ecosystem Science Center in Corvallis, Oregon. Pyke said that arid and semi-arid ecosystems where there is no history of large ungulates would probably do better without any grazing pressure, but that in areas where bison herds once roamed and grasses have adapted, there is a body of evidence that properly managed livestock grazing provides ecological benefits. In addition, removing livestock from areas where ranchers have become part of the solution to eliminating noxious weeds might also be ruinous – even if it was those same livestock who spread the weeds in the first place. Brian Martin of the Montana office of the Nature Conservancy agrees. “Ranchers are a key partner because they’re interested in a lot of the same outcomes as the conservation community. At the end of the day, we want to keep intact habitat that supports the full complement of wildlife species, and we’re able to use that livestock grazing as a way to manage and manipulate habitat conditions.” Darcie Warden, of the Bozeman-based Greater Yellowstone Coalition, told me that her organization also sees ranchers as vital to the future of habitat and wildlife conservation. “You know the saying: cows, not condos. In some places that doesn’t apply, but out here it does. This is a sought-out location by a lot of people and there’s a lot of money, and if we lose those working ranch lands, we are going to see a fragmented landscape.” On the morning I sat with Vicki Olson on her porch, she seemed cheerful, even as she described her sense that the walls were closing in. Life on the range has never been easy, and as far as Olson is concerned, the land transfer threat is just the latest in a string of attempts to push ranchers off the land. The only thing unique about it is that it’s coming from the right. “Honestly, I don’t think it’s going to happen, but that was before this administration,” Olson said, referring to the election of Donald Trump. When I asked Olson who she thinks is representing the interests of her community in Washington, she said: “Well, Liz Cheney out of Wyoming, and Rob Bishop out of Utah.” I asked her if she knew that Rob Bishop was the chief advocate of the land transfer agenda in Congress, and she looked stunned. “No, I didn’t know that,” she said. “That really surprises me.” I asked Olson where she thought the ranch and the adjacent public land would be in 50 years. “I hope it’s still in agriculture,” she said, although she said she wasn’t sure either of her two children would ever take over the ranch. Her daughter, Michelle, owns a ranch with her husband in South Dakota, and her son, Jason, lives in the Bitterroot Valley, on the other side of the state. “He’s interested in the ranch, but we’re not ready to retire and we can’t afford to hire another person,” Olson told me. “Besides, when you love what you do, you don’t need to retire. That’s what my dad always said, and he was out here feeding cattle till the day he died.


News Article | May 9, 2017
Site: www.fastcompany.com

It’s a Friday afternoon, and Andrew Hull, the founder and president of marketing consulting firm Elixiter, is still hard at work in his Bozeman, Montana, office. But soon–insanely soon–he’ll be setting up camp with a troop of local Boy Scouts. When he finally ducks out of the office at 4 p.m., he, the scouts, and four other chaperones are at a trailhead within the hour, ready to backpack three miles. Camp is set before nightfall. “You can get anywhere in Bozeman in 15 minutes,” says Hull, whose 40-employee company’s clients include Fitbit and Aetna. “Where Elixiter is, we have access to trailheads within 15 minutes. Skiing is 25 minutes.” Bozeman (pop. 43,405) has long been a magnet for outdoor enthusiasts; count Hull, an avid cyclist, among those ranks. But the small city has also earned another reputation as a boomtown for entrepreneurs, many in high technology. Thanks in part to its natural amenities, the presence of a university, and an embrace of the digital economy, Bozeman is turning into a startup hub in the middle of nowhere. The place is incomprehensibly scenic, even by Montana standards, situated in a spot where four mountain ranges decide enough is enough and relax into a fertile valley. Yellowstone National Park is a 90-minute drive. A River Runs Through It was filmed on the nearby Gallatin River, so trout fishing is a given. Like many places in the state, the local economies were driven for years by tourism and agriculture. But unlike many, this city in the southwestern corner of Montana started to diversify its economy in the 1980s when photonics companies started to build lasers, and manufacturing and outdoor-gear firms also settled in. A conservationist might bump into a think-tank economist at one of the local breweries. Montana State University (MSU) provides both thousands of jobs and an annual batch of new employees. The real major transformation in the town’s economy began in 1997, when Greg Gianforte founded RightNow Technologies, a customer relationship management firm. Gianforte had previously started a company in New Jersey, and after selling that one to McAfee, he set his sights toward Bozeman to raise a family. “We had this idea that the internet removed geography as a constraint,” Gianforte says. “When we started, that was a theory; it wasn’t a fact.” RightNow eventually grew to 1,100 employees, and Oracle bought it for $1.5 billion. Some 500 RightNow employees worked in Bozeman, and the Oracle acquisition seeded a new class of entrepreneurs. Gianforte founded a startup incubator and entered politics; the Republican is following an unsuccessful 2016 run for governor with a bid for the House of Representatives seat vacated by Secretary of the Interior Ryan Zinke. Sixteen other RightNow alumni have since started companies in Montana, many in Bozeman. In the five years since the Oracle deal closed, this wave of founders is reshaping the state economy. According to a University of Montana survey, the state’s high-tech sector in 2016 paid 14,500 employees a median wage of around $60,000. Both are sums a single West Coast company could top, but those are significant totals in a state with barely more than 1 million people where the median household income is about $50,000. “One problem we’ve had is that, historically, graduates from Montana colleges have been told to leave the state,” says Christina Quick Henderson, executive director of the Montana High Tech Business Alliance. “With the growth of the industry, that’s no longer true.” Among the 25 least-populated states, Montana has topped the Kauffman Foundation’s rankings of startup activity for four years running. Indeed, the 138 members of Quick Henderson’s trade organization added more than 900 jobs in 2016, and nearly 1,000 are expected to be added to payrolls in 2017. Odds are that those employees will remain in those jobs, too. Montana employers enjoy preposterously high retention rates compared with their counterparts in larger metros. “They don’t want to leave,” says Hull. “We have a 75% lifetime retention rate. That’s pretty crazy in the tech and marketing industry.” It’s not a phenomenon exclusive to Elixiter. The Kauffman Foundation recently studied the startup scenes in Bozeman and Missoula, home of the University of Montana, and found a similar result. “It’s a big contrast: People in Silicon Valley are always looking for better job opportunities . . .  [but] people in Montana are a lot more laid back,” says Yasuyuki Motoyama, the Kauffman Foundation’s former director of research, now incoming assistant professor at the University of Kansas. “They don’t constantly seek other opportunities or counteroffers. They are happy with the company where they are working.” One reason for the high retention rates is that work-life balance, the subject of many a Silicon Valley manifesto, is manifest in Bozeman. Single-minded careerism isn’t really a thing in Bozeman–folks come to work and participate in the area’s copious outdoor activities. That notion is baked into company cultures. “When we do our team-building activities, if we can incorporate river rafting or hiking or doing something outside, that’s one of our big goals,” says Daren Nordhagen, president of Foundant Technologies. Keeping employees in Bozeman may be easy, but finding them is a challenge. Instead of competing with other companies amid a large talent pool, Montana firms for years had to fill the pool themselves. Gianforte’s bait of choice was home-state pride. Twice a year, RightNow would send postcards to MSU computer science grads who had left the state, and the company erected billboards on highways leading to Big Sky ski resort and Yellowstone. He says 80% of his employees in Bozeman were born in Montana, and the rest were “hunting and fishing fools” who wanted the Montana lifestyle and a good wage. Subsequent entrepreneurs have followed suit, though they aren’t having to work quite as hard as RightNow did to lure folks to Bozeman. MSU is churning out more graduates–it is now the largest college in the state–and Bozeman’s growth has made it more palatable for many incoming residents. The downtown is densifying and adding amenities. Some remain astonished that the town is now home to a wine bar. “Most of [our employees] had already made the choice to live in Bozeman,” Nordhagen says. “There are people that move here because they want the outdoor lifestyle, or they want to get out of the big city and have a more rural area to raise their families, yet still have access to decent jobs, decent restaurants, and an airport. There are tons of people who are moving to Montana, and then figuring out the rest once they get here.” That’s not to say workforce development isn’t a critical element of business. MSU is not MIT, and the Bozeman metro area holds 100,000 people, not 1 million. Thus, extensive employee training programs are in order. Elixiter, for its part, runs one akin to a vocational apprenticeship. All new employees undergo three months of classroom-style training–homework included–taught by fellow employees, followed by three more months of shadowing a coworker. The pace of training fits with the overall growth model of most Bozeman companies. This is a population of founders comfortable with 20% growth and the addition of just a handful of staffers each year. (Not that there aren’t fast growers–five Bozeman firms, including Elixiter and Foundant, made the Inc. 5000 list in 2016.) One reason for this is a lack of venture capital. Aside from Next Frontier Capital, a local VC firm with a $21.5 million fund, substantial funding is virtually nonexistent in Montana. Most company founders bootstrap, so growth is curtailed by the available resources. Entrepreneurs in town feel the fiscal reality suits the rancher-and-miner culture of the state and helps yield resilient companies. “There’s this attitude of, ‘We’re going to figure this out.’ If you grow up on a farm or ranch, if something breaks, you have to fix it. There’s nobody else to do it for you,” says Hull. “So, there’s this spirit of ingenuity, of figuring things out, and that translates well to the tech world.” A reliance on hiring and training locals has its drawbacks. An obvious one is a lack of diversity. Hiring from the state workforce essentially means hiring white–87% of Montanans are Caucasian–and few founders are actively broadening their recruiting pipelines. Multiple executives labeled their applicants a “self-selecting” group, meaning folks turned off by the Montana lifestyle don’t bother applying. There are perks to this approach. A lifelong New Yorker would find Bozeman severely lacking in cultural amenities, while someone already living in Bozeman likely values fly fishing more than access to, say, international eateries. The latter person is more likely to fit in with these companies. It’s also more likely that person is white. It’s not just racial diversity that’s affected. Montana lacks statewide nondiscrimination policies based on sexual orientation or gender. When Bozeman passed its own nondiscrimination policy in 2014, a major opponent was the town’s tech figurehead–Gianforte. Buzzfeed reported in 2016 that Gianforte lobbied against an LGBT nondiscrimination ordinance, and his family trust has given $1.1 million to groups that fight against reproductive rights and LGBT equality. The lack of diversity could affect the bottom line as companies’ ambitions shift. “Some companies want to hire dozens of people a year, and that means you have to recruit people from the outside,” says Motoyama. “In IT-related jobs, you may need to find people from India, people from China. You don’t find those kinds of software engineers in Montana.” The job-hoppers some Montana entrepreneurs dread often are some of the most talented employees, are diverse, and sometimes come from far-off places. Matt Fulton would like some of those folks to find their way to Montana. During a five-year stint with Palo Alto-based Medallia, Fulton worked remotely from Bozeman for an 18-month period. After briefly returning to Palo Alto, he and wife Abby Schlatter moved back to Bozeman and started a company called commonFont in 2013. Fulton enjoys the familiar Bozeman perk: His employees love the town, and they want to stick around. But if he interviews a candidate whose primary motivation is to live in or move to Bozeman, rather than work at commonFont, he won’t extend an offer. “That’s one of the things that I like least about Bozeman. I wish there was more moving around, more competition for top talent,” Fulton says. “Retention is high because there’s not enough choice, and not enough competition. . . . If there was more of a culture of people looking around and evaluating other opportunities, I think that would be helpful and healthy. It would help us attract and retain a higher caliber of workforce.” If that lack of competition is simply a volume problem, then it could be solved by a continued surge in startup activity. Marty Ostermiller was RightNow’s director of finance until he left town in 2012, after the Oracle acquisition; he now works in Salt Lake City. “That’s the peril in Bozeman–your options are limited, and they were especially limited then,” he says. “But I think that’s part of why Bozeman became an entrepreneurial place. People wanted to stay there, and it wasn’t completely obvious where to work.” Founders who have stuck around share a considerable collective accomplishment: Few Western towns as small as Bozeman provide so many middle-class jobs for locals. Professionals from Idaho or Wyoming or New Mexico often face dichotomous choices: Either flee your home state for better-paying jobs in a coastal metro, or stick around and weather the boom-bust cycles of extraction-based economies and commodity agriculture. Someone entering the Bozeman job market today won’t face such polarizing choices. Intelligent planning and a bit of luck have stoked the boom. Proximity to Yellowstone is the reason its airport exists, but adding direct flights to spots such as Los Angeles, San Francisco, New York, and Dallas gave entrepreneurs and a contingent of remote workers better access to coastal markets; Bozeman’s is now the busiest airport in the state. The city has zoned areas of downtown for multistory, mixed-use development–a rarity in many scenic Western towns–and it laid the first phase of a fiber-optic network last October. Chris Mehl is a Bozeman city commissioner and works for Headwaters Economics, which researches the economies of the rural West. His firm has documented a trend in Western urbanization that exacerbates the economic gap between small cities–think Bozeman and Bend, Oregon–and the truly rural places surrounding them. A major determinant is infrastructure. If a town has access to transportation and high-speed internet, then it is easier for new companies to locate there. Remote employees, of which there are many in Bozeman, typically command high wages and can settle in any burg with internet access. “Why rural communities aren’t demanding broadband, I don’t know,” Mehl says. Bozeman’s growth has its downfalls. A robust startup scene, well-paid remote workers, and scenic beauty are a recipe for swelling housing costs. According to Zillow, the median list price of a house in Bozeman is north of $420,000 compared with $250,000 in Billings, the state’s largest city. But if wages and job numbers continue to flourish, it’s a problem numerous Western towns envy.


News Article | September 29, 2017
Site: www.businesswire.com

JACKSON, Wyo.--(BUSINESS WIRE)--Saturday’s Public Lands Day celebrates America’s crown jewel: more than 618 million acres set aside for the benefit and enjoyment of present and future generations. These lands are held in trust for the American people and managed by the federal government. Following a leaked memo from the Department of the Interior, which recommends resizing as many as 10 national monuments or opening them up to mining, logging and industrial purposes, some are concerned that trust is in danger of being violated. “We’ve been talking to business and civic leaders in communities adjacent to national monuments around the country,” said Christian Beckwith, founder and director of SHIFT, an annual conference held in Jackson Hole, Wyo., that convenes stakeholders in America’s public lands legacy. “Across the board, they fear changes in national monument boundaries could have a negative impact on their bottom lines.” This year, as part of its focus on the business case for public lands, SHIFT is convening mayors, the heads of chambers of commerce, business leaders and outdoor recreationists to discuss how investments in outdoor recreation and public lands affect their communities. Keynote addresses, workshops and panel discussions will explore the impacts of public lands, including national monuments, on local economies. Dave Conine, former Utah state director for USDA Rural Development and one of SHIFT’s featured panelists, has witnessed the significant benefits a national monument designation makes on local communities. “Since President Clinton designated the Grand Staircase as a national monument, there has been a dramatic increase in new construction and local business development,” said Conine. “This is all related to the increase in tourism and the economic diversification that follows the visitor-based economy.” Lucas St. Clair, president of Eliotsville Plantation, Inc. and founder of Katahdin Woods and Waters National Monument, agrees. The region adjacent to the monument has experienced significant economic benefits in just the first year since designation. “The monument has led to increased economic stability in the region,” said St. Clair. “To threaten the conservation and recreational resource with timber harvesting puts in jeopardy the very thing that is helping the region at such an important time.” Research supports their concern. Headwaters Economics has studied the local economies surrounding 17 national monuments and found all showed continued or improved growth in key economic indicators. Nationally, outdoor recreation generates $887 billion in consumer spending and 7.6 million jobs each year, according to the Outdoor Industry Association. SHIFT invited Interior Secretary Zinke to open this year’s event and outline his vision for the public lands under his stewardship. His office acknowledged receipt of the invitation, but issued no further response. This year’s SHIFT will convene business owners, outdoor and conservation advocates, tribal leaders and land managers to explore ways to steward those 618 million acres—the 129 national monuments, more than 400 national parks, 560 national wildlife refuges, wild and scenic rivers, national marine monuments, national battlefields and wildernesses—set aside for the benefit and enjoyment of present and future generations. For more information and a complete 2017 SHIFT Festival schedule, visit shiftjh.org. SHIFT (Shaping How we Invest For Tomorrow) is an annual festival that explores issues at the intersection of conservation, outdoor recreation and cultural relevancy. It is a project of The Center for Jackson Hole, whose mission is to strengthen the coalition of interests devoted to our public lands. Join the SHIFT movement! Sign up for our community at SHIFTjh.org, and follow us on Facebook, Instagram and LinkedIn.


Mills D.,Stratus Consulting Inc. | Schwartz J.,Huntington University | Lee M.,Huntington University | Sarofim M.,U.S. Environmental Protection Agency | And 4 more authors.
Climatic Change | Year: 2015

This paper applies city-specific mortality relationships for extremely hot and cold temperatures for 33 Metropolitan Statistical Areas in the United States to develop mortality projections for historical and potential future climates. These projections, which cover roughly 100 million of 310 million U.S. residents in 2010, highlight a potential change in health risks from uncontrolled climate change and the potential benefits of a greenhouse gas (GHG) mitigation policy. Our analysis reveals that projected mortality from extremely hot and cold days combined increases significantly over the 21st century because of the overwhelming increase in extremely hot days. We also find that the evaluated GHG mitigation policy could substantially reduce this risk. These results become more pronounced when accounting for projected population changes. These results challenge arguments that there could be a mortality benefit attributable to changes in extreme temperatures from future warming. This finding of a net increase in mortality also holds in an analog city sensitivity analysis that incorporates a strong adaptation assumption. While our results do not address all sources of uncertainty, their scale and scope highlight one component of the potential health risks of unmitigated climate change impacts on extreme temperatures and draw attention to the need to continue to refine analytical tools and methods for this type of analysis. © 2014, The Author(s).


Schwartz C.C.,U.S. Geological Survey | Gude P.H.,Headwaters Economics | Landenburger L.,U.S. Geological Survey | Haroldson M.A.,U.S. Geological Survey | Podruzny S.,U.S. Geological Survey
Wildlife Biology | Year: 2012

Exurban development is consuming wildlife habitat within the Greater Yellowstone Ecosystem with potential consequences to the long-term conservation of grizzly bears Ursus arctos. We assessed the impacts of alternative future land-use scenarios by linking an existing regression-based simulation model predicting rural development with a spatially explicit model that predicted bear survival. Using demographic criteria that predict population trajectory, we portioned habitats into either source or sink, and projected the loss of source habitat associated with four different build out (new home construction) scenarios through 2020. Under boom growth, we predicted that 12 km2 of source habitat were converted to sink habitat within the Grizzly Bear Recovery Zone (RZ), 189 km2 were converted within the current distribution of grizzly bears outside of the RZ, and 289 km2 were converted in the area outside the RZ identified as suitable grizzly bear habitat. Our findings showed that extremely low densities of residential development created sink habitats. We suggest that tools, such as those outlined in this article, in addition to zoning and subdivision regulation may prove more practical, and the most effective means of retaining large areas of undeveloped land and conserving grizzly bear source habitat will likely require a landscape-scale approach. We recommend a focus on land conservation efforts that retain open space (easements, purchases and trades) coupled with the implementation of 'bear community programmes' on an ecosystem wide basis in an effort to minimize human-bear conflicts, minimize management-related bear mortalities associated with preventable conflicts and to safeguard human communities. Our approach has application to other species and areas, and it has illustrated how spatially explicit demographic models can be combined with models predicting land-use change to help focus conservation priorities. © Wildlife Biology, NKV.


Gude P.H.,Headwaters Economics | Jones K.,ObjectiveStat Consulting | Rasker R.,Headwaters Economics | Greenwood M.C.,Montana State University
International Journal of Wildland Fire | Year: 2013

This paper uses wildfires in the Sierra Nevada area of California to estimate the relationship between housing and fire suppression costs. We investigated whether the presence of homes was associated with increased costs of firefighting after controlling for the effects of potential confounding variables including fire size, weather, terrain and human factors such as road access. This paper investigates wildfires in a way that other published studies have not; we analysed costs at the daily level, retaining information that would have been lost had we aggregated the data. We used linear mixed models to estimate the effects of homes on daily costs while incorporating within-fire variation. We conclude that the expected increase in the log daily cost with each unit increase in the log count of homes within 6 miles (∼9.7km) of an active fire is 0.07 (P≤0.005). The findings of this study are in agreement with most other previous empirical studies that have investigated the relationship between fire suppression costs and housing using cumulative fire costs and more generalised data on home locations. The study adds to mounting evidence that increases in housing lead to increases in fire suppression costs. © 2013 IAWF.


Gude P.H.,Headwaters Economics | Rasker R.,Headwaters Economics | Jones K.L.,Objectivestat Consulting | Haggerty J.H.,Headwaters Economics | Greenwood M.C.,Montana State University
Growth and Change | Year: 2012

The U.SWest has gone through many periods of economic boom and bust, most of which were associated with rapid rises and declines in commodity marketsThe recent structural shift toward a primarily service-based economy begs the question of whether the driving forces behind the cycles of boom and bust also may be shifting away from commodities toward people and their resourcesThis paper explores several factors that contributed to growth in the 1990s and 2000s: asking whether these factors created any advantages or disadvantages during the most recent recession and whether the shift away from commodity production to a knowledge- and human capital-intensive economy has implications for how local areas experience the boom-bust cycle. © 2012 Wiley Periodicals, Inc.


Haggerty J.,Montana State University | Gude P.H.,Headwaters Economics | Rasker R.,Headwaters Economics
Energy Economics | Year: 2014

The purpose of the study is to evaluate the relationships between oil and natural gas specialization and socioeconomic well-being during the period 1980 to 2011 in a large sample of counties within the six major oil- and gas-producing states in the interior U.S. West: Colorado, Montana, New Mexico, North Dakota, Utah, and Wyoming. The effects of participation in the early 1980s oil and gas boom and long-term specialization were considered as possible drivers of socioeconomic outcomes. Generalized estimating equations were used to regress 11 measures of economic growth and quality of life on oil and gas specialization while accounting for various confounding factors including degree of access to markets, initial socioeconomic conditions in 1980, and dependence on other economic sectors. Long-term oil and gas specialization is observed to have negative effects on change in per capita income, crime rate, and education rate. Participation in the early 1980s boom was positively associated with change in per capita income; however the positive effect decreases the longer counties remain specialized in oil and gas. Our findings contribute to a broader public dialogue about the consequences of resource specialization involving oil and natural gas and call into question the assumption that long-term oil and gas development confers economic advantages upon host communities. © 2014 Elsevier B.V.


Rasker R.,Headwaters Economics | Gude P.H.,Headwaters Economics
Journal of Regional Analysis and Policy | Year: 2013

The purpose of the study is to determine whether protected federal lands in the nonmetropolitan U.S. West are associated with increased or decreased economic performance. A subset of federal lands managed by the National Park Service, the Forest Service, the Bureau of Land Management, or the Fish and Wildlife Service was considered protected and primarily managed for conservation. Generalized estimating equations were used to regress ten economic measures on protected land area while accounting for various confounding factors including presence of other natural amenities and degree of access to markets. Three economic measures were positively associated with protected public lands: per capita income (2010), growth in per capita income (1990-2010), and growth in per capita investment income (1990-2010). The study finds that, on average, counties with national parks, wilderness, and other forms of protected public lands benefit through increased economic performance. © 2013 MCRSA. All rights reserved.

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