On the Border: Impact of COVID-19 pandemic a mixed bag for northwest Minnesota border communities

The COVID-19 pandemic has created winners and losers. Nowhere, perhaps, is that more apparent than in border communities like Roseau, Warroad and Lancaster.

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Polaris employee Kris Ostby works on the ATV line in early October at the company's production facility in Roseau, Minn. (Photo/ Eric Hylden, Grand Forks Herald)
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EDITOR'S NOTE: This story is part of the Herald's "On the border" project, which includes multiple stories and a three-part video documentary.

In the months before Gov. Tim Walz restricted indoor dining in Minnesota's bars and restaurants for the second time, Roxy Kulyk didn't need to worry much about social distancing customers at her diner in Lancaster, Minn.

On one chilly October weekday, Foxy Roxy's Diner was nearly empty – except for a small group of local customers – despite a lunch special of fried chicken with all of the fixings.

Foxy Roxy's was hurting, a casualty of the COVID-19 pandemic and the closure of the U.S.-Canada border. The diner, which usually relies heavily on truckers driving through Lancaster, population 331, on their way to and from Canada, saw a dramatic drop in business since the pandemic prompted the border closure in late March, Kulyk said.

“This is what’s killing us,” Kulyk said.


Kulyk is one of many business owners in northern Minnesota who have struggled from a one-two punch delivered by the closure of the international border and the coronavirus pandemic.

Roxy Kulyk is the owner of Foxy Roxy's Diner in Lancaster, Minn. (Sydney Mook/Grand Forks Herald)

Herald reporters and photographers/videographers traveled to Lancaster, Roseau, Warroad and the Lake of the Woods area in northwest Minnesota this fall to document the challenges business owners have faced during the first eight months of the pandemic. What the Herald found is that some businesses in that region have struggled, or had to adjust and adapt, due to the border closure. Meanwhile, some businesses there – including Polaris in Roseau and Marvin in Warroad, as well as resorts along the south shore of the lake and even some realtors – were seeing upticks in business as summer turned to autumn.



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The pandemic has been especially unkind to Foxy Roxy's Diner. Besides a drop in the number of customers who used to frequent the diner each day, the pandemic and border closure has crimped Kulyk's ability to host the events, such as parties, she previously did to supplement her income.

Even if Gov. Walz rescinds or adjusts his order about indoor dining, it's likely Kulyk's troubles will remain until the border closure is lifted. That is, if it is lifted anytime in the near future, Kulyk said.

Since the border closure, even the morning coffee crowd has been a casualty of the pandemic. For years, tables of six to 14 customers sat at three tables shaking dice to see who paid for coffee. Now, because the dice would have to be sanitized after every shake, those coffee drinkers stopped coming.

Adding to the frustration, Kulyk has to buy disposable dinnerware and condiments, which must be thrown away whether used by a customer or not. Ordering food is a problem, too. Kulyk said she is limited in the kinds of meals she can prepare because some of the usual food she orders just isn’t available.

Losses mount

A few blocks from the diner, Bernstrom Oil also has seen a drop in traffic. Pre-pandemic, the service station’s convenience store derived half of its business from Canadian customers, said Charlie Bernstrom, who has worked in the family business since 1990.

Besides the reduction in convenience store customers, the family-owned company, which has been in business in Lancaster since 1936, also has lost sales of gasoline, mechanical work on Motor Coach Industries buses and no longer can deliver parcels to Canada.

The work of mounting and balancing tires for the bus company in Winnipeg has been cut by about 50%, Bernstrom said. The border closure also stymied Bernstrom Oil’s work on Canadian farmers’ tractor tires this past summer.

The combination of revenue losses adds up, Bernstrom said.


“It pretty much stinks,” he said. “Everything is up in the air. I don't know when everything will end.”

In October, Bernstrom said he had reduced hours to offset the service station’s drop in business and used a $39,000 PPP – Payroll Protection Program – loan he received for payroll. Keeping the nine full-time employees working at Bernstrom Oil was a priority, according to Bernstrom.

“I don’t like to lay off; everyone we have here is valuable,” he said.

Back on Lancaster’s main street, Carol Johnson, Lancaster city clerk-treasurer, said limitations put on events in public places have put a dent in the town’s revenue reserves.

The city, which rents its large meeting room to wedding receptions and other celebrations as a source of income, had to stop doing that in February. Since then, groups of only 45 people or fewer have been allowed to gather in the city meeting room.

The city also has seen a drop at its city-owned liquor store as a result of the coronavirus pandemic and border closure. The city campground, where usually a dozen Canadian recreational vehicles park during the summer, also lost business as a result of the border closure, Johnson said.

The lack of Canadian customers didn’t only result in reduced revenue for the city, but also some of its businesses.

“Those 12 families weren’t here spending money at our grocery store and gas store,” Johnson said, noting that Vintage Plus, another Lancaster small business that depended on the Canadian traffic, permanently closed its doors during the summer of 2020.

“It’s been tough on a lot of businesses,” said Lancaster Lumber owner Luke Nordin, adding that the challenge is getting the products he needs to get construction projects completed on time. The lead time for ordering supplies has increased from two weeks to eight to 12, Nordin said.

Shingles, siding, windows and particleboard are among the products he sees being delayed.

A major siding provider is backed up for months, he said.

“Some of the stuff we ordered in August, they said they wouldn’t produce until January,” Nordin said.

The prices of building supplies also have risen during the pandemic. Nordin was fortunate that he ordered a lot of supplies in June. Still, finishing his projects on time is challenging, and Nordin said he is grateful that most customers have been understanding about delays.

“So far, we’ve had a lot of projects going on, and only a few have decided to wait it out until spring,” Nordin said.

Boom times at Polaris

Business remains strong for the region’s largest manufacturers, such as Polaris Industries in Roseau, Minn. The factory weathered the storm of the pandemic and a three-week shutdown in mid-March and continues to seek new workers to meet demand for its products, said Nathan Hanson, operations manager for the Polaris factory in Roseau.

Nathan Hanson, director of operations at Polaris in Roseau, Minn. (Photo/ Eric Hylden, Grand Forks Herald)

As the Star Tribune reported, the Medina, Minn.-based company's earnings of $166.8 million were up 90% over the third quarter of 2019, and sales for the quarter ending Sept. 30 increased 10% to $2 billion.

Demand for Polaris products has been “extremely strong” since the shutdown, Hanson said, driven by an appetite to recreate outside.

“As we started back up, we saw just incredible demand for our product,” Hanson said.

Speaking for Roseau specifically, Hanson said he didn’t necessarily expect that demand, when Polaris reopened in April; recession certainly was on peoples’ minds.

“I think your mind went back to 2008-2009, so we didn't know, and we were preparing for, kind of bracing for, what might be the worst and had that plan in place,” Hanson said. “Ironically, we came out and saw the opposite. And really, we’ve been chasing that potential upside ever since that point.”

During a mid-October interview, Hanson said Polaris in Roseau would like to hire another 60 employees to augment its workforce of about 1,400 in an effort to meet the continued strong demand for Polaris products.

“There’s nothing better to socially distance than riding a Polaris four-wheeler or riding a Ranger or going out in the woods,” Hanson said. “When you think about it that way, you can really understand why people are so interested in our products and using them in this environment.”

Banding together

Throughout the pandemic, Hanson said people in Roseau have “banded together” to help each other, whether it be ordering takeout food to keep the restaurants going or encouraging residents to patronize small businesses.

Polaris, for example, has given “Roseau Dough” promotional dollars to employees as a reward for quality work or safety records, Hanson said.

“We don’t want to lose any of our businesses in town,” he said. “I think as you drive through Roseau today, you see the Tractor Supply in the old Shopko building, you see the new Cenex and Burger King, which is just beautiful.

“So, there is a lot of positive growth in Roseau.”

Still, there is a lingering concern that the pandemic has permanently changed shopping habits in favor of online retailers such as Amazon, according to Mary Hoffer, promotions director for the city of Roseau.

That was apparent in mid-May, when Gov. Walz lifted the order that had required all but essential businesses to close during the first two months of the pandemic.

“When the stores were able to open back up in May, they expected people to be at their doors waiting to come in and shop, but that didn’t happen,” Hoffer said. “I think people have gotten in the habit of ordering online – I hate to say it.”

No doubt that’s hurt, Hoffer says, but it’s not all doom and gloom.

“I think the businesses in town have really done a good job of flexing and flowing after the initial shock of being shut down,” Hoffer said. “I think the majority of the businesses are like, ‘OK, we’re going to have to be creative here and think of ways.’ ”

Mary Hoffer, promotions director for the city of Roseau, Minn. (Photo/ Eric Hylden, Grand Forks Herald)

Positive signs in Warroad

In Warroad, Minn., 20 miles to the east on state Highway 11, Drew Parsley is seeing delays getting supplies for the 67-room Hampton Inn he is building with his partner, Jon Waibel, a Lake of the Woods County commissioner who lives near Baudette, Minn., and their project developer, JLJ Management.

The developers broke ground on the $9 million Warroad hotel in October 2019, seeing a need for lodging to host the snowmobilers, hunters, anglers and hockey players and families who travel to Warroad, Roseau and Baudette for recreation.

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In October, Drew Parsley stands in front of what will be a 67-room Hampton Inn. (Sydney Mook/Grand Forks Herald)

The project hasn’t had to shut down because of delays in getting supplies, but the targeted date for completion was delayed from October to December, Parsley said.

“We’ve had a very rough, rocky start to this,” according to Parsley, who said he has no intention of not completing the project.

“We’re going to plow through this thing and make it happen, no matter what,” Parsley said

Across state Highway 11, on a busy corner, Lake of the Woods Coffee owner Aimee Roberts is confident her new business, which opened its drive-thru in July, will be successful, despite the pandemic.

Roberts and her family have owned an online engraving business since 2015 and decided to expand it to include a brick-and-mortar location in two years. Roberts, with the help of Scott Marvin, her dad, bought and remodeled an old gas station into the coffee shop. Besides the coffee, she sells beverages, food and specialty products that include laser-engraved items.

Opening the drive-thru in July allowed the business to work out the kinks and, at the same time, keep employees and customers safe, Roberts said.

“Opening the drive-thru only was a blessing for us,” she said.

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Workers at Lake of the Woods Coffee in Warroad, Minn., wear face masks or face shields during working hours. (Sydney Mook/Grand Forks Herald)

Since opening the building earlier this fall, she’s been pleased with the traffic, Roberts said.

“We’ve seen great success. We continue to add to our menu. We’ve added employees. We draw from a pretty large community, not just Warroad. It’s just been so well-received. We feel very blessed to be in this small community that always shows up and always supports,” she said.

Daisy Gardens cafe owner Khahn Duong also credits Warroad community members and the town’s Community Development organization with helping his business survive the pandemic. Duong moved his restaurant, which serves American and Asian food, from a building along Highway 11 to its current location downtown during the pandemic.

“When I reopened, the community helped,” Duong said.

Funding from Warroad Community Development LLC, helped him pay for remodeling the downtown building, he said.

Besides Lake of the Woods Coffee, several other businesses – Sip Sap, Algoma Eatery and Tavern, Annie’s Trading Post, Vientiane Lao and Thai and Boba Cottage – opened in Warroad during the pandemic. That’s a testimony to the support that community members and organizations, such as Warroad Community Development LLC and Warroad Community Development Hub, give to start-ups, said Cyndy Renfrow, Warroad Community Development LLC’s executive director.

The support from the two organizations gives entrepreneurs the confidence to open their businesses in Warroad, she said.

“I think they believe in the vision, that they really want to be part of it,” Renfrow said.

"The businesses and the community are pretty resilient" said Bob Marvin, Warroad mayor. "I think everybody pulls together."

Going strong

Meanwhile, established Warroad businesses, such as Marvin, the window and door manufacturer, and Doug’s Supermarket, have maintained their strong presence in the community during the pandemic.

Marvin employs slightly more than 1,800 people in Warroad, about 1,500 of whom work at the factory in Warroad and the remaining 300 in offices in town. Though the company closed early in the pandemic, and April and May were rough months, the company weathered the storm, said Rick Trontvet, Marvin Windows Co. senior vice president, human resources.

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In this photo taken from a video clip, Rick Trontvet, vice president of human resources at Marvin Co., in Warroad, Minn., talks about the impact of the pandemic and the company's ongoing efforts to recruit employees. (Video/ Sydney Mook, Grand Forks Herald)

Now, demand for Marvin products not only has recovered, but has improved, Trontvet said. The summer and fall construction seasons were busier this year than normal because “do-it-yourselfers” did projects during the pandemic.

It’s just another example of the strong manufacturing base that has helped northwest Minnesota withstand the pandemic as well as it has.

“The windows and doors industry has really done well,” Trontvet said. “Now we’re in the middle of needing lots of employees here. ... We need to staff up, not just here, but all over the country.”

Marvin has 6,180 employees in 12 factories in cities across the United States, including Grafton, N.D., Fargo and Northwood, Iowa.

The company has offered a variety of incentives to encourage people to work at Marvin.

“We have to think outside the box: plant pay increases, commuter bonuses, relocation bonuses at all levels,” Trontvet said.

As Warroad’s largest employer, a healthy Marvin company has a positive effect on the community.

“What’s good for us is good for the local economy,” he said.

As 2020 draws to a close, Trontvet is confident that, despite the pandemic, Marvin will have a profitable year and pass that on to its employees..

“We’ve already announced we will be sharing profits,” he said in October.

At Doug’s Supermarket, owner Chuck Lindner also has taken creative steps to maintain and grow his business during the pandemic. Lindner also owns a Doug’s Supermarket in Baudette and will open one in Pine River, Minn., in August 2021. He also owns a liquor store two miles west of Warroad.

Chuck Lindner, owner of Doug's Supermarket in Warroad, Minn. Photo by Eric Hylden/Grand Forks Herald

“The way we did business had to change,” Lindner said, noting that the grocery store reduced hours and increased its sanitizing measures. It also started curbside pickup and, with the help of the local ministerial association, twice-weekly delivery to older customers who live outside of town.

Meanwhile, the grocery store sells specialty smoked meats, has a Caribou coffee franchise and sells Kreative Kernel popcorn, made fresh in the store.

Lindner, who has owned the Warroad grocery store with his sister since 2004 and the Baudette store since 2015, constantly is searching ideas to increase market share. For example, the grocery store sells organic produce and natural foods.

“You kind of learn what works and what doesn’t,” he said. “When you’re the only store in town, you have to be something for everyone.”

Early in the pandemic, the number of customers visiting the store declined, but the sales per customer rose, Lindner said.

One of the challenges he’s faced during the pandemic is a shortage of some products.

“We’re still struggling to keep our shelves filled with high-demand items,” Lindner said.

As a way to reach out to customers who don’t feel comfortable coming into his store to shop, Lindner is developing an app through which customers can order their groceries, he said as he sat at a desk under a plaque that reads: “Tough times don't last. Tough people do."

If the saying is true, Foxy Roxy's Diner in Lancaster will be staying the course.

Kulyk, the diner’s owner, said that because of the loss of Canadian traffic, COVID-19 safety protocols and limitations on the food she can get, her business is “hanging on by a thread," but she will continue working six days a week, 17 hours a day in an effort to keep the diner afloat.

“I just keep drinking coffee and keep going,” Kulyk said.

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