Report Guide AGENCY OVERVIEW Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

Return to Report Guide AGENCY OVERVIEW Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

Statutory Authority North Dakota Century Code Chapters 10-30.5, 54-34.3, 54-34.4, 54-44.5, 54-60, 54-62.

Agency Description The North Dakota Department of Commerce has four legislatively created divisions: Community Services, Economic Development & Finance, Tourism and Workforce Development and a Director of Initiatives that work together with our stakeholders to expand and diversify the economy of North Dakota, support community development, raise awareness of North Dakota state brand/image in the national and international ecosystems and provide services to low income people. Our challenge is to make North Dakota a better place to live, work, do business and play, for all people that choose to make North Dakota their home which, in turn, will entice non-residents to consider becoming North Dakotans.

Agency Mission Statement • The Department of Commerce’s Mission is to be the lead agency responsible for attracting, retaining and expanding wealth in North Dakota. • The Department of Commerce’s Purpose Empower people, improve lives and inspire success. • The Department of Commerce’s Values are Courage, Curiosity, Humility and Gratitude.

Agency Performance Measures The North Dakota Department of Commerce has individual, team, division, agency and statewide performance measures. The department works diligently to create a line of sight for all employees to connect their individual and programmatic measures to the North Dakota Economic Development Strategic Plan. This plan identifies major goals and performance measures. And was vetted with a variety of stakeholders, including the ND Economic Development Foundation.

Major Accomplishments 1. Developed nearly 100 primary sector projects in 2019; actively working $2.00 billion in projects in 2020. 2. Introduced in excess of $50.0 million in start-up innovation activity using LIFT and InnovateND; recruited Plug and Play to the State of ND. 3. Deployed systems-wide unmanned system plan to include initial BVLOS capability in the Red River Valley, doubled activity within the NPTUAS and grew Grand Sky commercial activity by 30 percent. 4. Led the state's brand unification efforts by creating a brand portal and providing trainings.Currently 26 agencies are using the Be Legendary brand. 5. Reached 67.0 million TV, 12.0 million print, 34.0 million out-of-home, 112 million digital, and 5.3 million on social media through 2019 advertising campaign. 6. Developed new creative campaign in 2019 which included multi-channel placements wrapped trains, Chicago Union Station. 7. Earned 836 media mentions and placements including Conde Nast Traveler and CNN reaching an audience of 2.09 billion for an editorial value of $19.30 billion. 8. Retooled tourism division marketing materials due to pandemic and mobilized an in-state campaign and free cooperative platform featuring tourism businesses and destinations, resulting in a 38 percent increase in visits to NDtourism.com. Increased all 50 states. First time visitors made up 61 percent of visits. 9. Supported pandemic communications by providing leadership with JIC, CARE 19 apps, ND Smart Restart, ERG and Business Briefings.

Future Critical Issues 1. Support healthy, vibrant North Dakota communities. This is the underpinning of the Main Street Initiative – help ensure healthy, vibrant, financially solvent communities that attract and retain 21st century workforce. To attract, retain and grow workforce and subsequent productivity and resiliency in the state we must have healthy, vibrant communities, otherwise we may or may not get workers and we won’t get families. Paychecks get shipped out of state while the costs are local. Economic/ community development AND economic diversification are needed, and both are tied to our ability to provide workforce that supports those strategies. Our Rural ED survey also indicated that the focus of economic development activities in rural settings (5,000 pop or below) does not include primary sector businesses in most cases. They instead focus on projects that may fall into the community development arena (restaurants, bars, daycares, etc.). For Commerce to be relevant in rural ND we need to adjust programming to reflect this reality. The survey also revealed that 2/3 of rural areas do not have full-time, paid staff working on economic development and that two-thirds don’t have an economic development plan. Regionalization is a likely by-product of these trends meaning the reliance on others to conduct ED activities in local areas is increasing. Return to Report Guide AGENCY OVERVIEW Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

2. The North Dakota Economic Development Strategic Plan outlines five industrial targets for development: Value-added Agriculture, Advanced Manufacturing, Energy, Technology-Based Business, and Tourism. In addition, five key strategic initiatives remain critical to the state’s economic growth. These include maintaining a strong business climate, supporting entrepreneurs, workforce development, commercializing university-based research, and international trade.An intermodal site is now functional in Minot, ND but there is an expression of need on the eastern side of the state. Intermodal sites lower the cost of transporting goods produced in North Dakota, so they can reach markets outside the state is critical in business retention and expansion efforts. As value added companies grow, they move out of state. They locate nearer to intermodal loaders in Minneapolis, Winnipeg and other sites. We also need to continue aggressive and cooperative work with local communities to develop industries that are a match with each respective community. Cutting edge technology (Intellectual Property). We need to and will be working with our research universities to focus and support research that help put our ND companies and start-ups on the front line in developing better products that consumers desire. Strengthening the cooperative efforts between the Department and all its partners. The Department of Commerce has established a cooperative spirit with its various partners, both private and public. It is of great importance to continue to focus on long-term strategies for economic development, community development, workforce development and tourism development. 3. Address workforce issues to diversify the state’s economy. Today’s workforce is remarkably different for three reasons: our biggest challenge is COVID impacts on the economy, technology is changing requirements for both today and tomorrows workers, our broad approach to solving workforce challenges is not as effective as desired. Working with Job Service ND, the Dept of Labor, the Workforce Development Council (comprised of business professionals from across the state and multiple industries), Dept of Public Instruction, ND University System, and Dept of Human Services, we are refining our approach to workforce development. We must invest in telling a unified value story for ND to retain and grow our workforce. We must make tough decisions on which programs we can invest deeply in to drive near-term impact. We must work collectively across agencies through partnership and not duplication to achieve a remarkable impact for current and future workers and employers. 4. It is vital that we invest in marketing the State to enhance the positive image of North Dakota! De-urbanization as a result of COVID impacts provides an unprecedented opportunity to showcase North Dakota’s small cities and wide-open spaces as COVID has increased interest in rural America. North Dakota has advantages to attract visitors, businesses, workforce, new residents and investment but if we don’t showcase our state, other states (most notably our neighbors) will continue to rank higher than we do in the minds of consumers. 2020 image research shows that destination marketing dramatically impacts the state’s image across all economic development areas. It also shows that North Dakota lags competitors in awareness, in some areas as much as 22 percent. We need to look at marketing our state as an important investment to help us diversify our economy. 5. ND took an early leadership position with unmanned aerial systems (UAS) and protecting and growing that leadership position requires commitment to targeted UAS strategies that align with other state initiatives/areas of strength: Continue UAS testing, expand focus to include beyond the visual line of sight testing and data transmission investments; and grow defense (DOD), counter unmanned aerial systems (C-UAS) and cyber portfolios. We need to exploit our competitive advantage of having relatively low air traffic as compared to other states. ND has been leading the country in the creation and adoption of autonomous operations beginning in the ag sector. We believe ND is poised to lead the world in proving farms can be fully autonomous. This mitigates the workforce challenges in the state, creates the environment in which ag-focused students and workers choose to come to ND, but it also has the real potential to impact world hunger. Beyond the autonomous farm, within the value chain of agriculture are remarkable opportunities to build out increased robotics and automation which drive efficiency and increase productivity. Note progress is automation/robotics isn’t limited to agricultural application areas. 6. Continue to develop new tourism infrastructure, expansions and improvements. These attractions, activities and amenities are imperative to make our communities healthier and more vibrant- thus attracting visitors and residents. Return to Report Guide REQUEST SUMMARY Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Expenditures Legislative Budget Requested Budget Optional Description 2017-2019 Base Request 2021-2023 Budget Biennium 2019-2021 Change Biennium Request By Major Program Commerce Administration and Support 4,365,925 5,488,754 (1,048,254) 4,440,500 0 North Dakota Tourism 12,606,719 12,933,354 (1,828,104) 11,105,250 8,160,000 ND Workforce Development 4,325,600 5,498,612 (117,618) 5,380,994 0 Economic Development and Finance 20,965,208 11,880,824 5,858,868 17,739,692 32,624,436 Division of Community Services 43,592,999 51,188,470 7,915,190 59,103,660 (8,343,371) Total Major Program 85,856,451 86,990,014 10,780,082 97,770,096 32,441,065

By Line Item Salaries and Wages 11,646,114 13,217,286 (172,430) 13,044,856 (506,213) Operating Expenses 13,793,460 14,873,203 (2,013,355) 12,859,848 10,369,342 Grants 50,389,468 52,638,527 6,343,803 58,982,330 800,000 Discretionary Grants 1,107,046 2,150,000 (600,000) 1,550,000 0 Flood Impact Loans/Grants 351,193 0 0 0 0 Grants-Tribal Colleges 498,200 0 0 0 0 Agric. Products Util. Comm. (APUC) 2,282,513 0 0 0 0 Unmanned Aircraft System 0 0 0 0 21,000,000 North Dakota Trade Office 2,000,000 1,600,000 0 1,600,000 0 Partner Programs 1,939,845 1,562,531 (234,380) 1,328,151 234,380 Entrepreneurship Grants 1,848,612 948,467 (543,556) 404,911 543,556 Intermodel Container Shipping 0 0 0 0 0 CARES Act Funding - 2020 0 0 8,000,000 8,000,000 0 Total Line Items 85,856,451 86,990,014 10,780,082 97,770,096 32,441,065

By Funding Source General Fund 31,035,415 32,866,722 (4,930,008) 27,936,714 39,784,436 Federal Funds 42,995,228 44,040,415 15,710,091 59,750,506 (7,643,371) Special Funds 11,825,808 10,082,877 (1) 10,082,876 300,000 Total Funding Source 85,856,451 86,990,014 10,780,082 97,770,096 32,441,065

Total FTE 66.40 61.80 0.00 61.80 (3.00) Return to Report Guide REQUEST DETAIL Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Expenditures Legislative Budget Requested Budget Optional Description 2017-2019 Base Request 2021-2023 Budget Biennium 2019-2021 Change Biennium Request Salaries and Wages Salaries - Permanent 8,284,876 9,054,699 155,291 9,209,990 (335,400) Temporary Salaries 143,327 104,000 (104,000) 0 0 Overtime 9,758 12,000 (12,000) 0 0 Fringe Benefits 3,208,153 4,046,587 (71,721) 3,974,866 (170,813) Reduction In Salary Budget 0 0 (140,000) (140,000) 0 Total 11,646,114 13,217,286 (172,430) 13,044,856 (506,213)

Salaries and Wages General Fund 9,378,189 10,697,553 (189,008) 10,508,545 (149,792) Federal Funds 1,394,224 1,471,262 71,358 1,542,620 (356,421) Special Funds 873,701 1,048,471 (54,780) 993,691 0 Total 11,646,114 13,217,286 (172,430) 13,044,856 (506,213)

Operating Expenses Travel 569,713 827,324 (128,350) 698,974 0 Supplies - IT Software 58,969 114,856 (57,012) 57,844 0 Supply/Material-Professional 104,004 111,908 (5,400) 106,508 0 Food and Clothing 1,355 3,050 (350) 2,700 0 Bldg, Ground, Maintenance 208 350 (350) 0 0 Miscellaneous Supplies 48,531 40,179 (4,900) 35,279 0 Office Supplies 49,529 72,618 (15,700) 56,918 0 Postage 214,149 355,195 (34,710) 320,485 0 Printing 504,398 587,030 (4,000) 583,030 0 IT Equip Under $5,000 39,255 14,150 0 14,150 0 Other Equip Under $5,000 138 57,349 0 57,349 0 Office Equip & Furn Supplies 4,475 46,000 (15,000) 31,000 0 Insurance 5,244 7,073 0 7,073 0 Rentals/Leases-Equip & Other 18,986 25,750 (1,995) 23,755 0 Rentals/Leases - Bldg/Land 539,932 526,979 (193,996) 332,983 0 Repairs 9,220 11,600 (10,000) 1,600 0 IT - Data Processing 553,507 438,319 (82,430) 355,889 149,792 IT - Communications 79,183 106,244 (20,500) 85,744 0 IT Contractual Srvcs and Rprs 348,888 316,570 (14,350) 302,220 0 Professional Development 424,959 409,839 (83,350) 326,489 0 Operating Fees and Services 8,950,966 8,915,333 (1,368,055) 7,547,278 10,219,550 Fees - Professional Services 1,267,851 1,885,487 27,093 1,912,580 0 Total 13,793,460 14,873,203 (2,013,355) 12,859,848 10,369,342

Operating Expenses Return to Report Guide REQUEST DETAIL Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Expenditures Legislative Budget Requested Budget Optional Description 2017-2019 Base Request 2021-2023 Budget Biennium 2019-2021 Change Biennium Request General Fund 12,222,802 12,445,253 (2,844,560) 9,600,693 10,656,292 Federal Funds 539,146 945,459 291,576 1,237,035 (286,950) Special Funds 1,031,512 1,482,491 539,629 2,022,120 0 Total 13,793,460 14,873,203 (2,013,355) 12,859,848 10,369,342

Grants Grants, Benefits & Claims 50,384,528 52,638,527 6,343,803 58,982,330 800,000 Transfers Out 4,940 0 0 0 0 Total 50,389,468 52,638,527 6,343,803 58,982,330 800,000

Grants General Fund 3,446,968 3,670,429 (518,504) 3,151,925 7,500,000 Federal Funds 40,710,665 41,623,694 7,347,157 48,970,851 (7,000,000) Special Funds 6,231,835 7,344,404 (484,850) 6,859,554 300,000 Total 50,389,468 52,638,527 6,343,803 58,982,330 800,000

Discretionary Grants Travel 92 0 0 0 0 Professional Development 2,180 0 0 0 0 Operating Fees and Services 0 0 0 0 0 Fees - Professional Services 9,200 0 0 0 0 Grants, Benefits & Claims 1,095,574 2,150,000 (600,000) 1,550,000 0 Total 1,107,046 2,150,000 (600,000) 1,550,000 0

Discretionary Grants General Fund 965,574 2,150,000 (600,000) 1,550,000 0 Federal Funds 0 0 0 0 0 Special Funds 141,472 0 0 0 0 Total 1,107,046 2,150,000 (600,000) 1,550,000 0

Flood Impact Loans/Grants Salaries - Permanent 3,909 0 0 0 0 Temporary Salaries 4,964 0 0 0 0 Fringe Benefits 2,231 0 0 0 0 Rentals/Leases - Bldg/Land 545 0 0 0 0 IT - Communications 57 0 0 0 0 Grants, Benefits & Claims 339,487 0 0 0 0 Total 351,193 0 0 0 0 Return to Report Guide REQUEST DETAIL Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Expenditures Legislative Budget Requested Budget Optional Description 2017-2019 Base Request 2021-2023 Budget Biennium 2019-2021 Change Biennium Request Flood Impact Loans/Grants General Fund 0 0 0 0 0 Federal Funds 351,193 0 0 0 0 Special Funds 0 0 0 0 0 Total 351,193 0 0 0 0

Grants-Tribal Colleges Grants, Benefits & Claims 498,200 0 0 0 0 Total 498,200 0 0 0 0

Grants-Tribal Colleges General Fund 0 0 0 0 0 Federal Funds 0 0 0 0 0 Special Funds 498,200 0 0 0 0 Total 498,200 0 0 0 0

Agric. Products Util. Comm. (APUC) Salaries - Permanent 59,577 0 0 0 0 Temporary Salaries 8,593 0 0 0 0 Fringe Benefits 23,009 0 0 0 0 Travel 11,227 0 0 0 0 Supply/Material-Professional 64 0 0 0 0 Miscellaneous Supplies 72 0 0 0 0 Office Supplies 163 0 0 0 0 Postage 525 0 0 0 0 Printing 1,791 0 0 0 0 Rentals/Leases - Bldg/Land 1,454 0 0 0 0 IT - Data Processing 1,478 0 0 0 0 IT - Communications 208 0 0 0 0 Professional Development 3,931 0 0 0 0 Operating Fees and Services 75 0 0 0 0 Grants, Benefits & Claims 2,170,346 0 0 0 0 Total 2,282,513 0 0 0 0

Agric. Products Util. Comm. (APUC) General Fund 341,474 0 0 0 0 Federal Funds 0 0 0 0 0 Special Funds 1,941,039 0 0 0 0 Total 2,282,513 0 0 0 0 Return to Report Guide REQUEST DETAIL Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Expenditures Legislative Budget Requested Budget Optional Description 2017-2019 Base Request 2021-2023 Budget Biennium 2019-2021 Change Biennium Request

Unmanned Aircraft System Operating Fees and Services 0 0 0 0 21,000,000 Grants, Benefits & Claims 0 0 0 0 0 Total 0 0 0 0 21,000,000

Unmanned Aircraft System General Fund 0 0 0 0 21,000,000 Federal Funds 0 0 0 0 0 Special Funds 0 0 0 0 0 Total 0 0 0 0 21,000,000

North Dakota Trade Office Operating Fees and Services 2,000,000 1,600,000 0 1,600,000 0 Total 2,000,000 1,600,000 0 1,600,000 0

North Dakota Trade Office General Fund 2,000,000 1,600,000 0 1,600,000 0 Federal Funds 0 0 0 0 0 Special Funds 0 0 0 0 0 Total 2,000,000 1,600,000 0 1,600,000 0

Partner Programs Operating Fees and Services 916,650 641,655 0 641,655 96,248 Grants, Benefits & Claims 1,023,195 920,876 (234,380) 686,496 138,132 Total 1,939,845 1,562,531 (234,380) 1,328,151 234,380

Partner Programs General Fund 1,939,845 1,562,531 (234,380) 1,328,151 234,380 Federal Funds 0 0 0 0 0 Special Funds 0 0 0 0 0 Total 1,939,845 1,562,531 (234,380) 1,328,151 234,380

Entrepreneurship Grants Travel 2,235 37,500 0 37,500 0 Supplies - IT Software 625 650 0 650 0 Office Supplies 9 25 0 25 0 Postage 54 75 0 75 0 Printing 0 0 0 0 0 Return to Report Guide REQUEST DETAIL Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Expenditures Legislative Budget Requested Budget Optional Description 2017-2019 Base Request 2021-2023 Budget Biennium 2019-2021 Change Biennium Request Rentals/Leases - Bldg/Land 6,200 6,700 0 6,700 0 IT - Data Processing 2,287 12,500 0 12,500 0 IT - Communications 472 500 0 500 0 IT Contractual Srvcs and Rprs 3,014 3,100 0 3,100 0 Professional Development 1,377 1,500 0 1,500 0 Operating Fees and Services 1,964 2,450 0 2,450 0 Grants, Benefits & Claims 1,830,375 883,467 (543,556) 339,911 543,556 Total 1,848,612 948,467 (543,556) 404,911 543,556

Entrepreneurship Grants General Fund 740,563 740,956 (543,556) 197,400 543,556 Federal Funds 0 0 0 0 0 Special Funds 1,108,049 207,511 0 207,511 0 Total 1,848,612 948,467 (543,556) 404,911 543,556

Intermodel Container Shipping Grants, Benefits & Claims 0 0 0 0 0 Total 0 0 0 0 0

Intermodel Container Shipping General Fund 0 0 0 0 0 Federal Funds 0 0 0 0 0 Special Funds 0 0 0 0 0 Total 0 0 0 0 0

CARES Act Funding - 2020 Grants, Benefits & Claims 0 0 8,000,000 8,000,000 0 Total 0 0 8,000,000 8,000,000 0

CARES Act Funding - 2020 General Fund 0 0 0 0 0 Federal Funds 0 0 8,000,000 8,000,000 0 Special Funds 0 0 0 0 0 Total 0 0 8,000,000 8,000,000 0

Funding Sources General Fund 31,035,415 32,866,722 (4,930,008) 27,936,714 39,784,436 Federal Funds 42,995,228 44,040,415 15,710,091 59,750,506 (7,643,371) Special Funds 11,825,808 10,082,877 (1) 10,082,876 300,000 Return to Report Guide REQUEST DETAIL Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Expenditures Legislative Budget Requested Budget Optional Description 2017-2019 Base Request 2021-2023 Budget Biennium 2019-2021 Change Biennium Request Total Funding Sources 85,856,451 86,990,014 10,780,082 97,770,096 32,441,065 Return to Report Guide CHANGE PACKAGE SUMMARY Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Description Priority FTE General Fund Federal Funds Special Funds Total Funds Base Budget Changes Ongoing Budget Changes A-A 200 Reprioritize reduction 0.00 0 0 (505,000) (505,000) A-A 210 Marketing 15% Reduction 0.00 (630,000) 0 0 (630,000) A-A 250 Commerce Administration 15% Reduction 0.00 (996,990) 0 (3,283) (1,000,273) A-A 300 Reprioritize increase 0.00 0 0 525,150 525,150 A-A 350 Tourism 15% Reduction 0.00 (955,046) 0 0 (955,046) A-A 400 Workforce 15% Reduction 0.00 (499,664) 0 0 (499,664) A-A 402 Authority for Apprenticeship Program 0.00 0 347,157 0 347,157 A-A 500 Economic Development & Finance 15% Reduction 0.00 (1,272,936) 0 0 (1,272,936) A-A 501 Federal NPUASTS Program 0.00 0 7,000,000 0 7,000,000 A-A 600 Division of Community Services 15% Reduction 0.00 (386,364) 291,576 37,912 (56,876) A-A 601 CARES Act Authority for DCS 0.00 0 8,000,000 0 8,000,000 Base Payroll Change 0.00 (189,008) 71,358 (54,780) (172,430) Total Ongoing Budget Changes 0.00 (4,930,008) 15,710,091 (1) 10,780,082 Total Base Budget Changes 0.00 (4,930,008) 15,710,091 (1) 10,780,082

Optional Budget Changes One Time Optional Changes A-D 804 Destination Marketing - Tourism 2 0.00 7,000,000 0 0 7,000,000 A-D 805 Media Outreach - Tourism 3 0.00 960,000 0 0 960,000 A-D 807 Northern Plains UAS Test Site Operations Gener 4 0.00 2,346,500 0 0 2,346,500 A-D 809 Beyond Visual Line of Site Statewide Network 5 0.00 21,000,000 0 0 21,000,000 A-D 810 Grand Sky 7 0.00 7,500,000 0 0 7,500,000 A-D 808 Northern Plains UAS Test Site Federal & Specia 8 0.00 0 0 1,000,000 1,000,000 A-D 806 Brand Extension & Visitors Services - Tourism 10 0.00 200,000 0 0 200,000 Total One Time Optional Changes 0.00 39,006,500 0 1,000,000 40,006,500 Ongoing Optional Changes Return to Report Guide CHANGE PACKAGE SUMMARY Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Biennium: 2021-2023 Description Priority FTE General Fund Federal Funds Special Funds Total Funds A-C 802 HOME Program move to NDHFA 1 (2.00) 0 (7,643,371) (700,000) (8,343,371) A-C 803 Entrepreneurship 6 0.00 543,556 0 0 543,556 A-C 801 Partner Programs 9 0.00 234,380 0 0 234,380 A-C 811 Information Technology Unification 11 (1.00) (149,792) 0 0 (149,792) A-C 812 Add Operating to IT for AC 811 IT Unification 12 0.00 149,792 0 0 149,792 Total Ongoing Optional Changes (3.00) 777,936 (7,643,371) (700,000) (7,565,435) Total Optional Budget Changes (3.00) 39,784,436 (7,643,371) 300,000 32,441,065 Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 Change Group: A Change Type: A Change No: 200 Priority: Reprioritize reduction

Move 505,000 authority from grants to operating in order to cover expected incresase in miscellaneous contractual fees.

Change Group: A Change Type: A Change No: 210 Priority: Marketing 15% Reduction

In order to meet the 15% cut in Marketing, $630,000 was reduced out of operating fees and services.

Change Group: A Change Type: A Change No: 250 Priority: Commerce Administration 15% Reduction

A total of $500,000 of the discretionary line was reduced in order to meet the 15% cut. A total of $60,000 was used for the Workforce Division to meet their cut, a total of $160,000 was used to the Economic Development & Finance Division for them to meet their cut, and the remaining was used in order to have an operating appropriation for Commerce Administration.

The operating expenditures that were reduced totaled $350,481.

IT Data Processing was reduced by $20,000

Telephone Communications was reduced by $10,000

Travel was reduced by $30,000

IT Software/Supplies reduced by $52,386

Postage reduced by $32,000

IT Contractual Services reduced by $8,500

Lease/Rent Equipment reduced by $1,995

Lease/Rent Building/Land reduced by $110,000

Professional Development reduced by $15,000

Repairs reduced by $10,000

Professional Services reduced by $20,000 Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

Office Supplies reduced by $15,000

Printing reduced by $4000

Professional Supplies reduced by $1000

Food & Clothing reduced by $350

Bldg, Ground supplies reduced by $350

Miscellaneous supplies reduced by $4900

Office Equip/Furniture under 5000 reduced by $15,000

Change Group: A Change Type: A Change No: 300 Priority: Reprioritize increase

Move 505,000 authority from grants to operating in order to cover expected incresase in miscellaneous contractual fees.

Change Group: A Change Type: A Change No: 350 Priority: Tourism 15% Reduction

For Tourism Admin, travel was reduced by $18,350, Professional Development by $18,350, and Lease/Rent Building by $18,346.

For Tourism Marketing, $878,654 was taken out of operating fees and services.

And for Global, $21,346 was taken out of Professional Services.

Change Group: A Change Type: A Change No: 400 Priority: Workforce 15% Reduction

Reduced Operation Intern by 100,000, Reading Corps by 200,000 and 199,664 out of operating as follows:

5000 from travel

4400 from Professional Supply

700 from Offic Supplies Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

2710 from Postage

40,650 from Rent/Lease Bldg/Land

12,638 from IT Data Processing

10,500 from IT Communications

5,850 from IT Contractual Services

106,029 from Operating fees and services

6,561 from Professional Services

4,626 from IT Equip unter 5000

Change Group: A Change Type: A Change No: 401 Priority: Line change for Pre-k, from line 30 to 60

There was $151,284 of general fund authority sitting in the operating line for the Early Childhood Education program (Pre-K) but all the expenditures are taken out of the grant line. We just want to move that authority from the operating to the grant line.

Change Group: A Change Type: A Change No: 402 Priority: Authority for Apprenticeship Program

To enhance and expand the program to better meet ND workforce needs.

Change Group: A Change Type: A Change No: 500 Priority: Economic Development & Finance 15% Reduction

The biggest cut was in the Entrepreneurship line which was reduced by $543,556.

BIO Tech was reduced by 300,000 Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

Partner Programs reduced by 234,380

Travel reduced by 75,000

Professional Development reduced by 50,000

Rent reduced by 25,000

Operating fees and services reduced by 45,000

Change Group: A Change Type: A Change No: 501 Priority: Federal NPUASTS Program

Operations support for ND UAS sector as a national leader in the industry.

Change Group: A Change Type: A Change No: 600 Priority: Division of Community Services 15% Reduction

General funds of 216,576 cut out of Community Development, HOME program. Full appropriation is federal (with 700,000 special).

Homeless Grant program was cut $169,788.

Change Group: A Change Type: A Change No: 601 Priority: CARES Act Authority for DCS

Federal CARES Act funding during COVID19 pandemic.

Change Group: A Change Type: C Change No: 801 Priority: 9 Partner Programs

Funding would allow Commerce to support Partner Programs such as American Idian Business Development Office; Center for Technology and Business; Impact Dakota; ND Rural Development Council; ND Trade Office and ND Small Business Development Centers.

Change Group: A Change Type: C Change No: 802 Priority: 1 HOME Program move to NDHFA Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

Move HOME program to NDHFA, which compliments other programs within their agency, i.e., HIF, Low Income Tax Credit Program, Housing Trust Fund , to create a one stop shop will all funding sources in one agency with citizen focus.

Change Group: A Change Type: C Change No: 803 Priority: 6 Entrepreneurship

Entrepreneur education, coaching and mentoring from proven business owners to help entrepreneurs successful launch new businesses.

Change Group: A Change Type: C Change No: 811 Priority: 11 Information Technology Unification

Reinventing government efforts to unify IT positions to agency NDIT.

Change Group: A Change Type: C Change No: 812 Priority: 12 Add Operating to IT for AC 811 IT Unification Optional Pkg This package is adding expenses to the operating line to cover the cost of IT unification. The billing from NDIT will go up if IT unification occurs thus operating will need to increase to cover those costs to NDIT. The FTE removed in AC811 will now be under NDIT and will result in the need for increased NDIT support for Commerce. These expenses will be seen via Commerce's data processing bills from NDIT. Change Group: A Change Type: D Change No: 804 Priority: 2 Destination Marketing - Tourism

New late summer/fall compaign and new website; statewide marketing-building ND brand; value; improving awareness and image- there by elevating all other economic development initiatives.

Change Group: A Change Type: D Change No: 805 Priority: 3 Media Outreach - Tourism

Major Broadcast Media -segment inegration with a morning broadcast show.Targeted national media outreach- capitalize on trends toward the great American road trip by featuring ND in "Airstream Great American Road Trip" and "Midwest Living Road Rally".

Change Group: A Change Type: D Change No: 806 Priority: 10 Brand Extension & Visitors Services - Tourism Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

Expand brand visibility throughout ND by offereing contemporary wall visuals and information in identified sites statewide. The multi-agency plan would leverage existing facilities, staff and programs as a cost efficient way to showcase our unified brand.

Change Group: A Change Type: D Change No: 807 Priority: 4 Northern Plains UAS Test Site Operations General Fund

Operations support for ND UAS sector as a national leader in the industry, to support the agricultural and energy industries, commercializing intellectual property and operationalizing federal requirements.

Change Group: A Change Type: D Change No: 808 Priority: 8 Northern Plains UAS Test Site Federal & Special Funds

Operations support for ND UAS sector as a national leader in the industry.This continues support by allowing for additional authority for federal and special funds as requested at the Emergency Commission.

Change Group: A Change Type: D Change No: 809 Priority: 5 Beyond Visual Line of Site Statewide Network

To maintain the program management office; continue facilitation of infrastructure deployment. This includes personnel, subcontractors supporting the network; promotion; as well as maintaining and developing the deployed network.

Change Group: A Change Type: D Change No: 810 Priority: 7 Grand Sky

Development and expansion of critical infrastructure and saftety measures at test site.

Change Group: A Change Type: E Change No: 1 Priority: Remove prior biennium one-times

Removal of prior biennium one-time allocations.

Change Group: R Change Type: A Change No: 1 Priority: Bifurcation of ND Trade Office

NDTO is currently organized as a non-profit, membership-based, private/public partnership that provides education, research, engagement, advocacy, and expertise so that North Dakota companies develop their export business. It is governed by an independent board of nine, chaired by Lieutenant Governor. The Century Code referring to the International business and trade Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30 office is below. The future state proposed would allow the already established Economic Development Foundation to serve as an advisory board to NDTO programming and services through the Commerce Commissioner.

The current contract between Commerce and the NDTO allows for $1,600,000 in funding. The first $960,000 was paid within 45 days of the contract signing. The remaining $640,000 is provided on a dollar for dollar matching grant paid monthly. Assuming all matching funds are raised, the combination of the two revenues means the NDTO has a minimum budget of $2,240,000 or $186,666 per month. The proposed future state would split future funding between the Ag department and Commerce - $850,000 for Ag and $750,00 for Commerce.

Change Group: R Change Type: A Change No: 100 Priority: Microsoft 365

Add funds for increase in Microsoft 365 cost.

Change Group: R Change Type: A Change No: 101 Priority: IT Unification

Transfer 1 FTE to NDIT for IT unification

Change Group: R Change Type: A Change No: 801 Priority: Partner Programs

Change Group: R Change Type: A Change No: 802 Priority: HOME Program Transfer from Commerce

Change Group: R Change Type: A Change No: 803 Priority: Entrepreneurship

Entrepreneur education, coaching and mentoring from proven business owners to help entrepreneurs successful launch new businesses.

Change Group: R Change Type: A Change No: 807 Priority: Northern Plains UAS Test Site Operations General Fund Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

Change Group: R Change Type: B Change No: 804 Priority: Destination Marketing - Tourism

Provides $2M from General Fund for new late summer/fall compaign and new website; statewide marketing-building ND brand; value; improving awareness and image- there by elevating all other economic development initiatives.

Change Group: R Change Type: B Change No: 806 Priority: Brand Extension & Visitors Services - Tourism

Provides $200k from General Fund to expand brand visibility throughout ND by offereing contemporary wall visuals and information in identified sites statewide. The multi- agency plan would leverage existing facilities, staff and programs as a cost efficient way to showcase our unified brand.

Change Group: R Change Type: B Change No: 808 Priority: Northern Plains UAS Test Site Special Funds

Change Group: R Change Type: B Change No: 809 Priority: Beyond Visual Line of Site Statewide Network

Change Group: R Change Type: B Change No: 810 Priority: Grand Sky

Development and expansion of critical infrastructure and saftety measures at test site.

Change Group: R Change Type: B Change No: 813 Priority: Technical Skills Training Grant Return to Report Guide BUDGET CHANGES NARRATIVE Date: 11/30/2020 601 Department of Commerce Time: 13:43:30

The Technical Skills Training Program will provide grant funding to support expedited, skills-based and hands-on workforce training programs for displaced workers who need to develop the technical skills necessary to make a career change and remain gainfully employed in North Dakota.