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Billings woos Dell Computers – but no dice

Despite 10 months of trying to sell Dell Computers on Billings as a suitable site for a technology
center, the company has instead selected a city in Oregon.
Billings apparently came in second to Roseburg, a lumber and tourism city of about 30,000 in southwest
Oregon.

By JAN FALSTAD
Of The Gazette Staff

The town between Eugene and Grants Pass has an unemployment rate as high as 12 percent and a
vacant Albertson’s store that Dell can move into quickly and cheaply, according to negotiators who lobbied for
Billings.

No Dell comment

Cathie Hargett, Dell spokeswoman at company headquarters in Austin, Texas, wouldn’t confirm the
selected site except to say the announcement will be made after final details are worked out.
Hargett didn’t confirm Billings came in second for 300 to 350 high-tech jobs paying around $8 an hour or
an annual payroll of $7.5 million including benefits.
But Billings City Manager Dennis Taylor said it
had.
"So it goes, I am still disappointed since we
worked so hard to meet or exceed all of their
demands. It is tough to always be a bridesmaid,"
Taylor said.
Taylor said Billings worked hard to convince Dell
that the workforce was skilled and available, citing
success stories like the Wells Fargo loan processing
center, Wal-Mart and Sysco Food Service of Montana,
which has decided to stay in town pending finalization
of a land swap deal.

The deal

Dell Computer, which was the world’s largest
computer manufacturer until Compaq merged with
Hewlett-Packard, reportedly was talking with seven
cities including Billings.
Hargett also wouldn’t confirm that a larger pool of
jobless people and an empty grocery store for just $2
per square foot in an Oregon city swung the decision.
"We never discuss the number of communities we’re talking with or their merits," she said. "We just don’t
want to put communities in that spot. We never want to close discussions off with any community."
Dell employs 32,000 people in more than 150 countries. The corporation had two large tech hubs in Round
Rock, Texas and Nashville, Tenn., which was opened three years ago. It operates two smaller tech centers in
Waco, Texas and Twin Falls, Idaho.
The Twin Falls tech center, which opened in February, employs 312 people.
Twin Falls Economic Development Director Dave McAlindin said his city offered a total of $4.5 million in
economic incentives to Dell. The state of Idaho kicked in $3 million of that incentive package for training workers
for the difficult high-tech jobs.
He said the manager of the Dell center has never told him finding qualified workers was a concern and
already is expanding by adding a customer service division. That’s where employees handle questions from
Dell users on topics like billing. The new division will employ 114 people for a total of 426 people.
When Dell selected Twin Falls last October, the city had an unemployment rate of 4.5 percent, similar to
that of Billings.
Like Billings tried to do, McAlindin said the College of Southern Idaho convinced Dell that it had skilled
students and the technical training in high school to provide the workers.
"There was a process put in place where they were assured a long-term employment pipeline," McAlindin
said.
Sharon Peterson, an aide to Sen. Max Baucus, D-Mont., flew to Austin in December to sell Dell on Billings.
She said the company was concerned about finding qualified people.
"In Billings, we have the underemployed and the people who would drive into town for a good job, but you
can’t put your hands around a hard number," Peterson said.
The potential sites
Montana State University-Billings College of Technology was the finalist for the Dell site.
In March, the Board of Regents approved funding to allow the College of Technology to work with Dell and
convert space to house the Dell center. Had Billings won the contract, Dell would have expanded in four phases
including possibly building a 50,000 square-foot building. The total building project could have invested as
much as $7.5 million in Billings.
Dell also considered a contract with Rocky Mountain College using a vacant building with School District 2,
at a privately owned building at the TransTech Center in West Billings and at least two vacant buildings
including Pay ‘n Pak and Gibson’s.
Reports that Dell would have brought 700 jobs to Billings was inflated. The jobs would have been about
half that level.

Decision not announced

Even though Dell made its decision dropping Billings from consideration around June 12, no public
announcement was made.
On June 13, Joe McClure, executive director of the Big Sky Economic Development Authority, e-mailed city
and university officials involved in the talks that Billings was out of contention.
McClure, the lead negotiator, was disappointed, but said it was a learning opportunity.
"We put our best foot forward and there is nothing we can do to change the facts that unemployment rate in
this other town was twice what Billings was," McClure said.
MSU-Billings Chancellor Ron Sexton said Monday that he first heard Dell wasn’t coming 11 days ago in
McClure’s e-mail, but said he was waiting for further information before telling others including the Board of
Regents.
Eakle Barfield, MSU-B’s facilities director involved in the negotiations, said the deal would have been a
"win-win:" Dell gets the labor, and the university students get the jobs.
"The best part was seeing the whole community get together and see Billings put a proposal together. That
was enjoyable," Barfield said.
Billings Mayor Chuck Tooley looked at the decision as a learning experience, not a lost opportunity.
"It would have been a great addition to Billings, but we have not lost anything," Tooley said. "We would love
to have them, but obviously, we didn’t come in first."
Both Dell and the local development leaders say Billings could be considered for a future site since the
computer manufacturer is expanding even amid troubles in the high-tech sector.

Jan Falstad can be contacted at (406) 657-1306 or at [email protected]

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