Business & Tax Climate – Lower cost of doing business – Tax climate • No Corporate Income Tax • No Personal Income Tax • No Personal Property Tax • No Business Inventory Tax • No Inheritance Tax – Businesses are successful and growing

1. Site Selection
Consultant Presentation
August 2014

2. Why SD?
• Business & Tax Climate
– Lower cost of doing business
– Tax climate
• No Corporate Income Tax
• No Personal Income Tax
• No Personal Property Tax
• No Business Inventory Tax
• No Inheritance Tax
– Businesses are successful and growing

3. 86.4
87.6
88.1
88.1
88.2
88.6
88.8
89.2
89.5
89.9
89.9
90.1
90.4
90.7
90.7
91.1
91.4
91.6
92.0
92.9
93.6
94.2
94.4
94.8
96.4
96.5
96.8
97.5
98.1
98.2
98.3
98.7
98.7
98.8
98.8
100.6
100.9
101.6
102.3
103.2
103.2
106.2
107.1
107.2
109.4
111.3
112.9
114.1
115.4
117.2
118.2
85.0 90.0 95.0 100.0 105.0 110.0 115.0 120.0
Mississippi
Arkansas
Alabama
Missouri
South Dakota
West Virginia
Kentucky
Ohio
Iowa
Kansas
Oklahoma
Nebraska
North Dakota
South Carolina
Tennessee
Indiana
Louisiana
North Carolina
Georgia
Wisconsin
Idaho
Montana
Michigan
New Mexico
Wyoming
Texas
Utah
Minnesota
Arizona
Nevada
Maine
Pennsylvania
Rhode Island
Florida
Oregon
Illinois
Vermont
Colorado
Delaware
Virginia
Washington
New Hampshire
Alaska
Massachusetts
Connecticut
Maryland
California
New Jersey
New York
Hawaii
District of Columbia
South Dakota
has one of the
lowest operating
costs in the
nation, 88% of
the national
average
U.S. Average = 100.0
Source: Bureau of Economic Analysis
Cost of
Living
2012
Regional
Price Parities

4. 1.46%
16.99%
23.07%
32.31%
35.87%
39.33%
53.10%
62.22%
59.23%
67.18%
87.36%
90.70%
105.29%
0%
20%
40%
60%
80%
100%
120%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Private Sector Growth
Cumulative Growth of Gross Domestic Product (GDP) by State
South Dakota – 105.29%
United States – 63.08%
Minnesota –62.70%
Nebraska – 93.30%
Source: U.S. Bureau of
Economic Analysis (BEA)
Iowa – 75.41%

5. 1.46%
16.99%
23.07%
32.31%
35.87%
39.33%
53.10%
62.22%
59.23%
67.18%
84.36%
90.70%
105.29%
0%
20%
40%
60%
80%
100%
120%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Private Sector Growth
Cumulative Growth of Gross Domestic Product (GDP) by State
South Dakota – 105.29%
United States – 63.08%
Illinois – 45.00%
California – 58.53%
Source: Bureau of Economic
Analysis (BEA)
Texas – 108.54%

6. • Fiscal Stability
– Keep Government Spending in Check
– Structurally Balanced Budget
– No General Obligation Debt
– State Pension is 100% funded
Why SD?

7. Source: US Census & BEA
State & Local Gov. Spending
As a Percentage of Gross Domestic Product (GDP) by State
16.81%
15.71% 15.58%
15.15%
15.73%
16.04%
15.70% 15.60%
17.38%
17.55%
16.52%
14.00%
15.00%
16.00%
17.00%
18.00%
19.00%
20.00%
21.00%
22.00%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
South Dakota – 16.52%
United States – 20.49%
Minnesota – 19.49%
Iowa– 20.35%
Nebraska – 19.88%

8. Source: US Census & BEA
State & Local Gov. Spending
As a Percentage of Gross Domestic Product (GDP) by State
16.81%
15.71% 15.58%
15.15%
15.73%
16.04%
15.70% 15.60%
17.38%
17.55%
16.52%
14.00%
15.00%
16.00%
17.00%
18.00%
19.00%
20.00%
21.00%
22.00%
23.00%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
South Dakota – 16.52%
United States – 20.49%
California – 22.54%
Illinois – 19.32%
Texas – 16.28%

9. General Obligation Debt
• Insert General Obligation Debt Map
Source: Moody’s Investor Services

10. Why SD?
• Reasonable Regulation
– No Red Tape
– Quick & Efficient Processing
“In today’s political environment of being over taxed and over-
regulated, it is a pleasure to operate a business in South Dakota
where the state government does everything it can to help you be
successful.”
Adams-ISC

11. Why SD?
• Growing & Productive Workforce
– In-Migration State
– High Return on Payroll
– Low Rate of Unionization
– Quality Workforce

12. In-Migration State
Source: Tax Foundation,
2000-2010
South
Dakota
In-Migration States
Out-Migration States
Top Five States with
Populations Migrating
to South Dakota
• California
• Iowa
• Michigan
• Minnesota
• Nebraska

13. 2013 Wage Comparison
Median
Wage
Take Home
Pay
Purchasing
Power
California $56,507 $41,329 $36,607
Illinois $50,333 $37,288 $37,066
Iowa $46,059 $34,596 $38,654
Minnesota $51,471 $37,926 $38,898
Nebraska $45,248 $34,247 $38,010
South Dakota $43,244 $34,615 $39,246
Texas $48,609 $38,405 $39,798
All Occupations
Source: GOED Wage Study
Median Wage: Average Median Wage For All Occupations (U.S. Bureau of Labor Statistics)
Take Home Pay: Median Wage minus Federal & State Income Taxes and Social Security
Purchasing Power: Take Home Pay adjusted for Cost of Living (BEA Regional Price Parities)

14. $0.98
$1.00
$1.03
$1.00
$0.95
$0.99
$1.02
$1.01
$1.03
$1.12
$1.09
$0.55
$0.65
$0.75
$0.85
$0.95
$1.05
$1.15
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
South Dakota – $1.09
United States – $0.75
Nebraska – $0.92
Minnesota – $0.68
Iowa – $0.88
Source: Bureau of Economic
Analysis (BEA)
Return on Payroll
Business Profits* Divided by Total Employee Compensation
*Before Income Taxes &
Depreciation

15. $0.98
$1.00
$1.03
$1.00
$0.95
$0.99
$1.02
$1.01
$1.03
$1.12
$1.09
$0.55
$0.65
$0.75
$0.85
$0.95
$1.05
$1.15
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
South Dakota – $1.09
United States – $0.75
California – $0.78
Illinois – $0.67
Texas – $0.99
Source: Bureau of Economic
Analysis (BEA)
Return on Payroll
Business Profits* Divided by Total Employee Compensation
*Before Income Taxes &
Depreciation

16. Unionization
2013 Union Membership
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
United
States
California Illinois Iowa Minnesota Nebraska South
Dakota
Texas
11.3%
16.4%
15.8%
10.1%
14.3%
7.3%
4.8% 4.8%
Source: U.S. Dept of Labor,
Bureau of Labor Statistics

17. Quality Workforce
Credit Score Volunteerism
High School
Graduates*
U.S. 681 26.5% 86.4%
California 676 (30th) 25.1% (35th) 81.5% (49th)
Illinois 687 (19th) 27.4% (27th) 87.6% (30th)
Iowa 700 (8th) 36.0% (5th) 91.6% (8th)
Minnesota 713 (1st) 37.7% (2nd) 92.5% (2nd)
Nebraska 698 (9th) 36.0% (5th) 90.5% (13th)
South Dakota 713 (1st) 35.7% (7th) 90.5% (13th)
Texas 665 (39th) 24.0% (42nd) 81.4% (50th)
*Percent of Population, 25 Years and Older, that has graduated high school.
Sources: Experian, Volunteering
America, US Census Bureau

18. South Dakota’s Reputation
• Enterprising States – Business Climate: #1
2014 U.S. Chamber of Commerce Foundation
• Business Friendliness: # 2
2014 CNBC
• State Business Tax Climate Index: # 2
2014 Tax Foundation
• State Fiscal Condition Index: #2
2014 Mercatus Center, George Mason University
• State Economic Competitiveness Index: #2
2014 American Legislative Exchange Council
• Enterprising States – Talent Pipeline: #7
2014 U.S. Chamber of Commerce Foundation

19. Targeted Industries
• Advanced Manufacturing
• Bioscience
• Financial Services
• Oil & Gas
• Professional Business Services
• Shooting, Hunting & Outdoors
• Value Added Agriculture

20. State Incentives
• Low-Interest Loans
• Workforce Training Grants
• Internship Grants
• New – State Sales Tax Refunds (Building
South Dakota Fund)