Economic Year in Review

By Beacon Staff

Perhaps 2010 can be called the “Year of Cautious Optimism.” Signs of recovery emerged in isolated areas of the national and local economies, yet unemployment remains uncomfortably high and major industries like housing and timber continue to struggle.

The following is a sampling of the top business stories from the Flathead Valley over the past year.

One of the feel-good stories was the reopening of Sykes in downtown Kalispell. After selling Semitool to Applied Materials Inc., Ray Thompson saw an opportunity to revive the beloved diner and grocery store. Since reopening Sykes this fall, Thompson has overseen a major renovation. And now, as it was for so many decades, Sykes is busy everyday.

Building permits picked up a bit, but construction mostly remained sluggish while the timber industry is still trying to regain its footing. Over the summer, Kalispell Planning and Zoning Director Tom Jentz noted that building activity was outpacing 2009 but lagging behind 2008. “Is it a groundswell? No,” Jentz said. “But it’s definitely a change in the trend and it’s a good change.”

In November, Coldwell Banker Wachholz and Co. announced the closing of its five offices in Kalispell, Whitefish, Eureka, Lakeside and Plains. Ryon Brewer, CEO and managing broker said: “The company’s fortunes have been susceptible to the economic conditions of the times and have mirrored the decline of the local, regional and national real estate markets.”

On June 16, the much-anticipated Walmart Supercenter opened in Kalispell’s Hutton Ranch Plaza. Upon opening, the 188,028-square-foot store was expected to employ more than 400 people. Meanwhile, the old Walmart location on East Idaho Street was abandoned and remains empty.

Booming across the state, medical marijuana businesses ran into obstacles in the Flathead Valley when the Kalispell City Council prohibited dispensaries and the Whitefish City Council extended a temporary moratorium. Kalispell enacted a zoning ordinance that bans new medical marijuana businesses. Whitefish decided to extend its moratorium until June 6, 2011 while it decides how to address the issue.

The Whitefish City Council dealt with two other issues that were closely observed by the business community. In September, the council voted to allow mobile food vendors after struggling for months to decide whether the street stands would benefit the town. Then in November, after multiple meetings and considerable public input, the council voted to table a decision until January on whether to change zoning to allow more retail along U.S. Highway 93 at the southern entrance of the city.

A contractor facing 15 felonies in Washington was discovered to be operating in the Flathead Valley, with homeowners and former employees saying that they have been swindled. John Mulinski, who is accused of scams across the Pacific Northwest, runs a company called Sunrise Quality Construction. The state Department of Labor and Industry has been investigating Mulinski’s activities.

After a rough year in 2009, the tourism industry experienced a rebound this summer. Visitation to Glacier National Park was excellent and, according to many accounts, tourists were spending more money. The Institute for Tourism and Recreation Research at the University of Montana measured the total economic impact of tourism in 2007 at $4.3 billion. Then it dropped to $2.8 billion in 2008 and $2.3 billion in 2009. Tourism officials hope this year marks the reversal of that negative trend.

Flathead shop owners said Canadians boosted retail business all year long, including during the holiday season. Retailers said a perfect storm of circumstances prompted Canadians to cross the border more frequently for shopping. Among those circumstances were increased taxes back home, a favorable exchange rate and better prices.

Nomad Global Communication Systems secured a contract with the U.S. Army Corps of Engineers to build a series of emergency command and communication vehicles specially designed for the Corps’ Deployable Tactical Operations System. The vehicles, equipped with the best technology available, are used for responding to natural disasters. Nomad shipped out its first completed vehicles in November. With the contract, the company now has around 70 employees.

After rising to 13.8 percent in March, Flathead County’s unemployment rate declined for six straight months, reaching a low of 9.8 in September. But it shot back up to 10.8 percent in October and then another full percentage point to 11.8 in November. With any luck, it will get back under 10 percent in 2011 and stay there.

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