NEWS
from the Quentin N. Burdick Center for Cooperatives
North Dakota State University
March 1997
The mission of the Quentin N. Burdick Center for Cooperatives is to conduct, promote and coordinate university education and research on cooperatives, to strengthen cooperatives' operation, and to work toward expanding employment and economic opportunities through cooperatives.
From the Chair of the Advisory Board
Cooperatives continue their success story across North Dakota by providing services, supplies, and income for members and providing economic growth and jobs for the communities. The success of these cooperatives is due to many factors including financial strength, member loyalty, and continuing education of our cooperative structure. The Quentin Burdick Center for Cooperatives can be a part of the cooperative family in North Dakota by providing research for information to strengthen cooperative operations, and by developing curriculum and classes for students and other professionals whose careers will be with cooperatives. We are fortunate to have a working relationship between our cooperatives and affiliated organizations in this state, and it is a duty of the Advisory Board of the Burdick Center to have the Center work with this family of cooperatives and their success. Just as members come together to form cooperatives, our cooperatives must work together to better serve their members and their communities.
Many of you know we will be selecting a new director for the Burdick Center. I would like to take this opportunity to thank David Cobia for his time and commitment to the Burdick Center. I would also like to assure the members of the Burdick Center that the Advisory Board will work to select a new director that can carry out the original goals and mission of the Quentin Burdick Center for Cooperatives.
Sincerely,
Mark Watne
QBCC Advisory Board Chair
From the Director
Fulfillment of pledges to the Burdick Center Endowment Fund has continued at a rate not previously experienced by NDSU's Development Foundation fund drives. Most of the five-year pledges to the endowed fund have been fulfilled. There is now $738,656 in the endowment, including that provided by American Crystal for the Al Bloomquist Lectureship. This will provide $36,666 income for work by the Center in the 1997-98 fiscal year.
The Advisory Board selected a logo for the Center as depicted above from several proposed by Ag Communication. It was subsequently approved by Dr. Plough's office. We will typically use it in conjunction with other NDSU logos.
The Advisory Board has considered holding a brainstorming session with a cross section of co-op leaders from our state and region on their education and research needs. President Tom Plough has taken the initiative to first meet with the CEOs of the larger and newer cooperatives just prior to the Al Bloomquist Lectureship on March 26. We will plan a corresponding session with representatives of local cooperatives throughout the state to be held later.
New generation cooperatives continue to receive nationwide attention. They were the focus of a National Food and Marketing Symposium held in Las Vegas on January 16 and 17. Ralph Morris and I were on the program from our area. Copies of these remarks, along with others, will be available in the future. Several training conferences on cooperative development, featuring new cooperatives in North Dakota and Minnesota have been held at other locations such as Saskatchewan and Wisconsin.
David Cobia
Director
Annual Aldrich C. Bloomquist Lectureship
"Gate to Plate: Producers Take Control of An Industry," is the title Dennis Sexhus, CEO of North American Bison Cooperative, has selected for the Third Annual Al Bloomquist Lectureship. It is scheduled for 3:30 p.m., Wednesday, March 26, in the Century Theater of the Memorial Union at NDSU. You are all invited. Parking will be available in the visitors parking lot just east of the Sheppard Arena and Loftsgard Hall on Albrecht Boulevard.
Status Report on Senator Burdick's Biography
As reported in the last newsletter, Senator Kent Conrad asked the Center to manage the preparation of a biography on Senator Burdick. The initial fund raising effort, sponsored by Senator Conrad, brought in $25,510. This initial amount was sufficient to complete the information-gathering phase. Dan Rylance, the contracted author, conducted 110 interviews of colleagues, family, and friends, all of which have been transcribed. The interviews in audio, electronic, and hard copy formats, and all other materials collected for the project, are being deposited with the Special Collections section of the Chester Fritz Library at the University of North Dakota.
Further fundraising efforts to complete the project were needed so the Center's Advisory Board appointed a special committee to see the project through to completion. The committee is chaired by Dennis Hill, with Sidney Olson and Francis Leiphon as members. They devised a plan whereby an organization could provide funds and then be repaid from the proceeds of the book. The contracted author also agreed to a reduced fee in exchange for a percentage of the proceeds. This effort resulted in $35,000 being raised, all of which has been received. Gross receipts from book sales will be distributed as 10% to the author and 90% to sponsors of this new pool, according to the percentage of contributions to the total sponsor pool. Sufficient funds are now available to complete all phases of the project including the contracted amount to the author, the estimated publishing cost, and a promotional effort.
All revenues collected after sponsoring pool members have been repaid will be forwarded to a committee intending to build a display center depicting Senator Burdick's life in the new Quentin Burdick Federal Building located in Fargo.
Dan Rylance began the writing phase on the first of this year. It should be completed by the end of the summer. Professional review and publication by the Institute of Regional Studies should be completed by the spring of 1998.
Selected Activities of Frayne Olson, Assistant Director
Frayne Olson was the featured speaker at a statewide "New Wave Cooperatives" conference in Frankenmuth, Michigan. He presented information on the structural differences of the new generation cooperatives, the wide variety of projects appearing in North Dakota, and why the cooperative activities were so strong in North Dakota. Approximately 200 farmers, farm organization, and community development leaders participated. The participants had many positive comments and were interested in adapting the lessons learned in North Dakota to the conditions in Michigan.
A training session for NDSU Extension Service staff was conducted on February 13, 1997, discussing the process farmers and ranchers should use when evaluating membership in a new generation cooperative. This session highlighted the information presented in the two NDSU Extension Service publications, EB-67, "Should I Join a New Processing Cooperative?" and EC-1108, "Five Questions to Ask Before Joining a New Processing Cooperative," discussing the same topic. The demand for these publications has been good, and both are in their second printing.They are also being incorporated into four risk management meetings held in eastern North Dakota and sponsored by the NDSU Extension Service.
The development of a QBCC Home Page for the Internet's World Wide Web has begun. The QBCC staff is preparing materials and a demonstration version of the Home Page should be accessible by the end of March 1997.
QBCC Director Search Progress Report
A search committee for a new Quentin Burdick Center for Cooperatives director has been organized and has met to prepare a position announcement. The search committee members are:
Dr. Cole Gustafson, Committee Chair, Department of Agricultural Economics
Dr. William Wilson, Department of Agricultural Economics
Dr. Allen Henderson, College of Engineering/Architecture
Person to be appointed, College of Business
Mr. Frayne Olson, QBCC Assistant Director
Mr. Mark Watne, QBCC Advisory Board Chair
Mr. Gerald Kuster, QBCC Advisory Board Vice Chair
Mr. Dennis Hill, QBCC Advisory Board
Dr. Donald Anderson, QBCC Advisory Board
The position is currently being advertised to staff and faculty of North Dakota State University. Application deadline was February 28, 1997. The position is available July 1, 1997.
Conference: "New Wave Cooperatives/Putting Theory Into Practice" is a Big Success
We are extremely pleased with the Crookston, Minnesota, November 12-14 conference for steering committee members and CEOs of new and emerging cooperatives. We are gratified with the results. Every dimension was great, including the food!
Attendance: We planned for 40, hoped for 80, and 90 attended, including Dale Stenerson and Gerald Kuster from the Advisory Board.
Presentations: One mature participant went out of his way to say that this was the most helpful conference he had attended. Attendance held up to the very last part on the program. Many groups met afterwards.
Panelists: Panels of producers who have been through the ropes are always popular. They provided useful guidelines.
Financing: The $300 registration fee for most producer participants was covered by special grants from the Otto Bremer Foundation, the North Dakota Economic and Finance Commission, the Quentin Burdick Center for Cooperatives (with funds from the North Dakota Association of Cooperatives), and the Northwest Minnesota Initiative Fund.
Collaboration: Success of the conference was due in large measure to the congenial cooperative spirit and unselfish contribution of the other sponsoring agencies, the Agricultural Utilizing Research Institute (AURI) and the Northwest Minnesota Initiative fund.
Next Time: The fourth such program is planned for Fargo, North Dakota, on November 12-14, 1997. This time we plan to promote the conference in other regions of the country. We feel that the market for this type of conference can become saturated; therefore, it is unlikely that we will be holding them every year.
Research
The following paragraphs summarize recently completed and ongoing research coordinated by the Center.
Economic Impact of Cooperatives on North Dakota's Economy: North Dakota is well known as a leader in cooperative movement throughout the United States. A survey of 235 North Dakota cooperatives reveals that they were directly responsible for providing employment to over 8,700 people, or almost 3% of the state non-farm employment in 1996. These cooperatives paid over $21 million dollars in local property taxes in 1996, which is nearly 3% of the total state taxes. These cooperatives plan to create about 1,200 new jobs in 1997. The total business activities generated by cooperatives was almost $1.2 billion, and accounted for 15% of total business activities in the state's retail and service sectors. These cooperatives also generated an additional 12,000 jobs (4% of the total state employment) and almost $20 million dollars in state tax revenues (2.7% of the total state taxes) from their business dealings with other businesses in the state. This study shows that cooperatives play a vital role in the North Dakota economy.
Farmers Who Do and Do Not Join New Value-Added Cooperatives: Telephone and mail surveys were obtained from 191 investors and 127 non-investors in four new cooperatives. Investors were younger, better educated, had nearly twice the net worth, viewed themselves more in the food processing business, and disagree more with negative statements about new cooperatives than non-investors. Publications are being prepared on this research. A preliminary report is in a paper presented by David Cobia titled, "New Generation Cooperatives: External Environment and Investor Characteristics."
Agricultural Loan Officers' Role in Cooperative Investment: Brooks Wilson, Gary Goreham, Theron Kibbe, and David Cobia have published results of a survey of 338 agricultural loan officers and 215 loan supervisors regarding their role as gate keepers for farmer investment in new cooperatives (AgEc Report No. 366). Approval of loans did not seem to be influenced by positive or negative feelings about cooperatives. Experienced loan officers who attended co-op information meetings were most likely to approve loans. Attitudes toward cooperatives were generally favorable even though many felt that new cooperative stock was a risky investment, inferior to stock and mutual funds.
Potential for Non-Agricultural Cooperatives: Sanjib Bhuyan is estimating the potential for non-agricultural cooperatives in the northern plains states. This includes the potential for non-agricultural businesses as well as shared-service cooperatives among non-profit and governmental units. Early results have been published as AgEc Report Nos. 360 and 363 and AgEc Misc. Report No. 178.
Problems and Solutions Faced by Non-Agricultural Cooperatives: A database of 3,000 non-agricultural cooperatives in the U.S. has been created by Sanjib Bhuyan. A survey to ascertain problems and solutions faced by these cooperatives is being sent to a sample of 1,000 drawn from this database.
Executive Compensation: David Cobia is collaborating with Rob King, University of Minnesota, and David Trechter, University of Wisconsin-River Falls, on managerial compensation practices used by cooperatives.
External Environment: Brooks Wilson is analyzing external institutional support available to farm groups in North Dakota who wish to start cooperatives.
Allen Henderson, New Advisory Board Member
Dr. Allen Henderson, professor in the Department of Industrial Engineering and Management, has been appointed by NDSU President Tom Plough to replace Harriette McCaul as one of two NDSU representatives on the Advisory Board.
Harriette McCaul resigned from the Advisory Board when she resigned as Dean of the College of Business. She subsequently left the university to accept the position of Senior Vice President of Human Resources for Community First Bank Shares in Fargo. She made substantial contributions to the Burdick Center during her tenure, for which we are grateful. We wish her well in her new position.
Dr. Henderson has had an illustrious career academically and in the Air National Guard. Al has been active with the Happy Hooligans since 1954 and is currently a Brigadier General. He is a graduate of Fargo's Central High School and NDSU, with a Ph.D. from Iowa State University. He and his wife, Joyce, have three grown children: Todd, Amy, and Jill. He served as chair of the Department of Industrial Engineering and Management from 1978 to 1995. We look forward to forging new links to the College of Engineering.
Selected Materials Available From the Center
Note: These materials can be obtained by sending a request to the Quentin Burdick Center for Cooperatives, NDSU, Fargo, North Dakota 58105-5636; Fax: (701) 231-1059, Telephone: (701) 231-7446.
Video (Loan)
Al Bloomquist Lectureship by Joseph Famalette, Gazing Into the Crystal Ball: Career Opportunities in the Food and Agriculture Industry in the 21st Century. Audio version also available.
Cooperatives: An Economic Alternative.
Cooperatives, The Farmers Way.
Dedication Luncheon of the QBCC.
History and Mortgage Burning Ceremony, Minn-Dak Farmers Co-op.
How to Start a Cooperative Food Buying Club, National Cooperative Business Association.
Reviving Renville: A Cooperative Approach to Development, Minnesota Association of Cooperatives.
Rochdale Principles, Ken Astrup.
Printed Materials
Bhuyan, S., Potential applications for shared-services cooperatives in North Dakota, Ag. Econ. Misc. Report No. 178, Dept. of Agricultural Economics, North Dakota State Unversity, Fargo, June 1996.
Bhuyan, S., Trade analysis of retail and service industries in North Dakota for planning local economic development, Ag. Econ. Research Report No. 363, Dept. of Agricultural Economics, North Dakota State University, Fargo, October, 1996.
Bhuyan, S. and F.L. Leistritz, Economic impacts of Cooperatives in North Dakota, 1996, AE Series Reports 96009, Dept.of Agricultural Economics, North Dakota State University, Fargo, December, 1996.
Cobia, D.W., W.W. Wilson, S.P. Gunn, and R.C. Coon, Pricing Systems of Train Loading Country Elevator Cooperatives, Ag. Econ. Rpt. No. 214, ND Ag. Exp. Sta., December 1986.
Cobia, D.W. and R.C. Coon, Pricing Systems of Train Loading Country Elevator Cooperatives: A Summary, Ag. Econ. Rpt. No. 215, ND Ag. Exp. Sta., December 1986.
Cobia, D.W., ed., Cooperatives in Agriculture, Englewood Cliffs, NJ, Prentice Hall, 1989. $40.00.
Cobia, D.W., Dynamics of American Cooperative Movement, a talk by David Cobia in Tokyo, Japan, August 1994.
Cobia, D.W., New Generation Cooperatives: External Environment and Investor Characteristics, a talk given at a Food and Marketing Symposium held in Las Vegas, NV, January 1997.
Cooperative incorporation statutes for North Dakota, South Dakota, and Minnesota.
Dahl, B.L., D.W. Cobia, and F.J. Dooley, 1995, Bulk Fuel Distribution Costs for Cooperatives in North Dakota, Ag. Econ. Rpt. No. 334, ND Ag. Exp. Sta.
Dahl, B.L., D.W. Cobia, and F.J. Dooley, 1995, Distribution Costs for Dry Fertilizer Cooperatives in North Dakota, Ag. Econ. Rpt. No. 339, ND Ag. Exp. Sta.
Famalette, J., Gazing Into the Crystal Ball: Career Opportunities in the Food and Agricultural Industry in the 21st Century, Al Bloomquist Lectureship, April 1995.
Freeh, V., World Trade and Market Globalization: The Other Parts of The Equation, 2nd Annual Al Bloomquist Lectureship, April 1996.
Gunn, S. and D.W. Cobia, Strategies for Survival in the Country Elevator Industry, Ag. Econ. Misc. Rpt. No. 122, Dept. of Ag. Econ., NDSU, Fargo, May 1989.
Gunn, S.P. and D.W. Cobia, Grain Marketing Cooperatives: Adjustments to Farm Programs, Ag. Econ. Rpt. No. 291, ND Ag. Exp. Sta., September 1992.
Hatfield, H.K., D.W. Cobia, and G.W. Erlandson, Consolidation of Allocated Equity for Merging Cooperatives Previously Operating on a Revolving Fund, Ag. Econ. Misc. Rpt. No. 96, Dept. of Ag. Econ., NDSU, Fargo, April 1986.
New Generation Cooperatives, A set of articles
Royer, J.S. and D.W. Cobia, Measuring the Equity Redemption Performance of Farmer Cooperatives, North Central Journal of Agricultural Economics, Vol. 6, No. 1, January 1984.
Training Program for New and Emerging Cooperatives, Handout material and speaker notes in loose-leaf form. One set each for June 1994 and June 1995.
Wilson, B., G. Goreham, T. Kibbe, and D. Cobia, 1996, Agricultural Lenders' Role in Cooperative Investment in North Dakota, Ag. Econ. Rpt. No. 366.
Wilson, B. and G. Goreham, 1996, The Formation of New Cooperatives and the Attitudes of Investors and Non-Investors, accepted as a presented paper for the A.A.E.A. 1997 summer meetings.
Zinovchuk, V. V., 1995, Farmer Cooperatives Versus Collective Farms: American Studies on Ukrainian Problems, ND Ag. Exp. Sta., 186 pp.
QBCC Staff
Director:
David Cobia 301 J Morrill Hall
dcobia@ndsuext.nodak.edu (701) 231-7446Assistant Director:
Frayne Olson 301 F Morrill Hall
folson@ndsuext.nodak.edu (701) 231-7688Research Associate:
Sanjib Bhuyan 301 H Morrill Hall
sbhuyan@ndsuext.nodak.edu (701) 231-9591Research Associate:
Brooks Wilson 301 G Morrill Hall
brwilson@ndsuext.nodak.edu (701) 231-9592Secretary 301 Morrill Hall
qbcc@ndsuext.nodak.edu (701) 231-9590
This newsletter is published by the Quentin N. Burdick
Center for
Cooperatives, Box 5636, NDSU, Fargo, ND 58105, phone (701) 231-7446,
fax (701) 231-1059. Advisory board: M. Watne, N.D. Farmers Union, chair;
G. Kuster, Harvest States, Vice Chair; Dennis Hill, NDCC, Exec. Com.;
D. Anderson, NDSU, Exec. Com., A. Henderson, NDSU, Exec. Com.; E.
Dobrinski, St. Paul BC; F. Leiphon, Cenex; D. Loer, Minnkota Power; R.
Maras, LO'L; R. McPhail, Basin Elec.; D. Melander, Cass-Clay Creamery;
S. Olson, NDAREC; and D. Stenerson, Farmland Ind.