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How many millionaires in N.D?

You'd think it would be easy to define "millionaire." You have enough to buy whatever you want, unless you want to buy something like Costa Rica or a Senate seat or Joe Mauer's bat for a week, or you struggle with an addiction, such as farming.

Where millionaires are thickest
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You'd think it would be easy to define "millionaire." You have enough to buy whatever you want, unless you want to buy something like Costa Rica or a Senate seat or Joe Mauer's bat for a week, or you struggle with an addiction, such as farming.

But does North Dakota have more millionaires per capita than any other state, as an Internet travel site brags?

Or does the state rank 46th in the nation in the proportion of millionaire households it claims?

That's where the state stands according to rankings prepared by Phoenix Marketing International, a New York investment company.

(Minnesota ranks 18th, which isn't exactly something you'd shout about unless you're shouting at No. 46.)

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Phoenix Marketing counts liquid assets only, not land or other real estate, which probably accounts for North Dakota's low ranking. The state has many more millionaires whose wealth is tied up in land and expensive machines.

But by Phoenix's count, North Dakota has just 9,051 millionaires, the lowest number of all 50 states and the District of Columbia. Millionaire households account for 3.42 percent of all households in the state, a proportion higher than just South Dakota (3.39 percent), Kentucky (3.3), West Virginia (3.28), Arkansas (3.12) and Mississippi (3.06).

Hawaii has the highest proportion of millionaire households, at 6.41 percent. California has the biggest number of millionaires, with 662,735 -- or about as many millionaires as North Dakota has people.

The commonly heard boast that North Dakota has more millionaires per capita than any other state is cited on a travel Web site, www.legendsofamerica.com , but with no sourcing.

"I have also heard that and often thought it was probably an 'urban legend' in the prairie," said Ralph Kingsbury, an economist who writes a regular column for the Herald. "That is certainly the case, it seems to me, if you don't count land, because I know very few 'rich' people outside of that."

According to Phoenix Marketing and other analysts, the recession has taken a toll on the nation's supply of liquid-capital fat cats as well as the lower and middle classes. There were 5.97 million U.S. millionaires in 2007, according to the Phoenix definition, with the number falling to 5.61 million in 2008 and 5.14 million in 2009.

Both North Dakota and Minnesota have fallen in the rankings since 2006, when North Dakota stood 43rd and Minnesota 16th.

North Dakota had 10,163 such millionaires then, according to the investment company, or roughly 1,100 more than in 2009. Minnesota had 99,246 millionaires in 2006 and rose to 115,587 in 2007 before falling to 95,321 in 2009.

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They earned it

Another way to define millionaire, of course, is by annual income.

Kathy Strombeck, a research analyst at the state tax department, told N.D. Business Watch that the number of "measurable millionaires" in North Dakota rose from 266 in 2005 to 339 in 2006 and 399 in 2007.

Those were the numbers of taxpayers who reported adjusted gross income of $1 million or more, she said, adding that the jump in seven-figure incomes was more than likely because of oil royalties paid to mineral owners.

"I certainly don't think they're stock market millionaires," she said.

The North Dakota Petroleum Council agreed, with one council executive calculating that oil development in the state was producing one new millionaire a day.

And when figures for all of 2008 were tabulated, the number of North Dakota income millionaires went up 18.5 percent -- to 473 state taxpayers who reported adjusted gross incomes of more than $1 million.

Reach Haga at (701) 780-1102; (800) 477-6572, ext. 102; or send e-mail to chaga@gfherald.com .

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