April 26, 2021

There should be a big circle around the date May 26, 2021, on the calendar of Mario and Vilma Vargas.

It’s the day the couple, moving from Utah, is scheduled to close on their new house on the east side of Sioux Falls.

It’s also the “go live” day for the business that brought them here – RushMore Logistics, a third-party contractor supporting the newly opened Amazon warehouse.

“I’ve never been to South Dakota before we came to Sioux Falls two weeks ago to look for houses,” Vilma Vargas said.

“It’s a new chapter. One minute I’m super scared; one minute I’m excited.”

Their story is increasingly common in the Sioux Falls area and expected to become even more so.

The past year has brought an influx of new residents, drawn by economic opportunity and what they perceive as a less restrictive environment for regulation – whether related to the pandemic, business or both.

“The last year has been challenging but great for economic development,” said Steve Westra, commissioner of the Governor’s Office of Economic Development, which holds its annual conference in Sioux Falls this week.

“We continue to see strong growth across a wide variety of industries. There’s not one of the business development reps on our team right now that’s not working multiple potential opportunities coming into Sioux Falls.”

For the Vargas family, Sioux Falls was one of approximately 20 markets on a list provided to them by Amazon when they were awarded the right to serve a warehouse with delivery drivers.

They both work other corporate jobs and plan to continue doing so remotely while leading RushMore Logistics.

“We evaluated based on living expenses,” Vargas said. “We like that Sioux Falls has no income tax and it’s close to Colorado because all my family … is in Denver. So from Sioux Falls, it’s a one-hour flight, and we decided, you now what? We’re going to try it.”

Others are betting on South Dakota for various reasons. Some point to their support of Gov. Kristi Noem’s leadership during the pandemic.

“I really think how the state positioned itself through COVID and really stuck to being open for business, and understanding the impact that governments can have on business and the way Gov. Noem handled it, we just continue to see really strong interest,” Westra said. “It’s just amazing how many people keep hearing and seeing our governor and talking to South Dakota because of it.”

Other deals in process before the pandemic came together in 2020, including the larger Amazon fulfillment center, which is separate from the warehouse, and the CJ Foods processing facility, both at Foundation Park.

The dairy industry is contributing to growth too, with an expansion of dairies designed to support cheese processors that became so robust there’s now a need for more processors.

On the west side of the state, it’s the B21 bomber site coming to Ellsworth Air Force Base.

“Last year, we assisted in $2.8 billion in capital investment in South Dakota, and that number didn’t even include CJ Foods,” Westra said. “We continue to see across the entire state, the (large) number of people moving in, whether it’s Spearfish, the entire Black Hills area or the city of Sioux Falls, and that’s partly why we’re seeing a housing shortage.”

For the Vargases, finding a home wasn’t too hard, but the pricing was a little surprising, Vargas said.

“I thought housing would be less expensive in Sioux Falls, but it’s not much cheaper than Salt Lake City,” she said.

Housing and workforce are the two most common issues raised by communities as barriers to growth, Westra said.

“We are still an exporter of talent,” he said. “We have the people. There are people who are underemployed and a lot of incredible talent.”

The Vargases are hoping so. They need about 15 people to launch RushMore Logistics.

“I’m ready to offer to 13 people, but in two or three months, we have to have 50,” she said. “We get a lot of applicants. It’s great, 10 or 15 a day, but it’s a different profile. Half of them are not serious. They don’t show up, so that’s been challenging.”

She’s hopeful her first offers will go through, but “they need to do the background check, they need to do the drug testing, they need to show up,” she said. “But they seem to be very interested. You tell them you’ll be delivering Amazon packages and people seem to be excited.”

Applicants can find listings through indeed.com, and the company will start hiring for managers in a couple of months, Vargas said.

“If you show us you have a passion and a strong work ethic, there is opportunity for growth,” she said.

Building permit shows another major project en route to Foundation Park