Our view: Digi-Key: A story that must be told
What's bigger: A million-square-foot facility, or the impact it will make in a town of 8,000 residents?
Earlier this year, Digi-Key Electronics announced it will construct a massive new building in its hometown of Thief River Falls, Minn. Company officials say the expansion will create more than 1,000 jobs — at a place that already employs thousands — and is expected to be an investment worth $200 million to $300 million.
The Herald first wrote about it June 1. More recently, Prairie Business magazine — which is published by the Herald — included a brief story about the expansion in its July edition.
The August edition of Prairie Business will have a heavy focus on the expansion, and the big feature on Digi-Key is expected to be the cover story.
Why the attention? Because this is monumental news for the region.
Grand Forks, East Grand Forks, Crookston and Thief River Falls are separate cities, each with their own leadership and destiny. But really, those four cities are intertwined through their shared interest in the region doing well.
We're all in this together, whether it's sugar beets, potatoes, UAS or large employers such as Digi-Key.
Why will Digi-Key's expansion occur?
It starts with the incredible story of Digi-Key itself. The company began in 1972 when Ron Stordahl, who is still the owner, began selling a single product for ham radio enthusiasts: a "Digi-Keyer."
Now, Digi-Key is one of the world's largest distributors of electronic components and employs more than 3,000 workers — many of whom commute from the Grand Cities, Crookston and the region.
Also important in this expansion is the city of Thief River Falls, which sold Digi-Key a parcel of city land for a fair value ($1.37 million — the appraised rate). The city also approved a tax increment plan for the company.
Next, the state pitched in. This spring, Minnesota Gov. Mark Dayton signed a bill that gives Digi-Key tax incentives for its expansion. The incentives — which had blanket bipartisan support in an otherwise partisan session — give to Thief River Falls $1.6 million for infrastructure improvements, and to Digi-Key a $4 million Minnesota Investment Fund loan, plus a sales tax exemption worth $40 million over 10 years on purchases made for the facility's construction.
And now, the answer to the question at the top of this piece: The economic impact is much, much bigger than the physical footprint.
Digi-Key forecasts that its expansion will add upwards of $500 million in additional annual economic output. That's quite a return on investment, and it will benefit the region, too. Many Digi-Key employees live in Grand Forks, and it's inevitable their paychecks will be spent here.
It's huge news about an incredible project, and it's a story that must be told. We'll highlight that story even more in the August edition of Prairie Business.