Watertown Leaders Emphasize Collaboration to Overcome Housing, Land, and Workforce Challenges

Logo of Watertown Development Company featuring a modern geometric emblem and bold typography on a dark blue background.

Northeast Radio SD News - Watertown, SD - A panel of local leaders at the Watertown Development Company (WDC) annual meeting, moderated by David Strait of Austin Law, outlined key economic development successes and identified critical hurdles facing the community's future growth. The discussion focused on four core pillars: the banking community, manufacturing, city administration, and the municipal utility.

The panel consisted of:

·         Alan Stager (City Manager, City of Watertown)

·         Mark Dunn (Market President, First Premier Bank/Premier Bankcard, representing the banking/lending community)

·         Steve Lehner (General Manager, Watertown Municipal Utilities)

·         Dan Garvey (Director of Production Control, Terex Utilities, representing the manufacturing sector)

Successful Initiatives and Projects

Panelists highlighted several major and ongoing investments that have positively impacted the local economy, spanning infrastructure, public facilities, and private sector expansion:

·         Public and Civil Projects: The Prairie Lakes ice arena was noted for its local impact. Completed projects include the new City Hall renovation, and work is underway on the new jail project.

·         Infrastructure Investment: A significant $60 million expansion of the wastewater treatment plant is approximately 40% complete. This modernization is crucial for increasing capacity and forming a foundation for future industrial growth, particularly in sectors like food and beverage.

·         Business Expansions and Startups: Specific private sector growth was cited at Crenlo, Dakota Automation, Sentry, and Wurth Electronics. South 40 Specialties was named as a new startup in the Pheasant Ridge industrial area.

·         Future Energy Project: The panel discussed the planned replacement of the city’s 60-year-old power plant, which will be a $500 million project undertaken by Missouri River Energy Services. The project currently involves tearing down the Hubbard Milling building to create future green space, with the new, modern plant to be built north of the current facility.

·         Entrepreneurial Support: The WDC's work in supporting entrepreneurs and assisting with workforce development and housing subsidies was recognized as vital, albeit less visible, economic activity.

Biggest Challenges Facing the Community

The conversation quickly shifted to the primary obstacles to economic development, with panelists collectively emphasizing the urgency of tackling several intertwined issues:

·         Housing and Childcare: These were identified as the top challenges, preventing the community from filling job openings. City Manager Alan Stager noted the goal of launching initiatives to grow the community by 3,000 housing units by 2035, emphasizing the need to get "ahead of that growth."

·         Shovel-Ready Land: Steve Lehner stated that the community is running out of industrial land, making the expansion and creation of a new industrial park a top hurdle. The consensus was that acquiring and preparing a new 200-acre site takes approximately five years to complete properly.

·         Workforce: Dan Garvey affirmed that workforce is a major challenge in the robust manufacturing sector, directly connecting to the housing and daycare shortages.

·         Data Center Capacity: In response to a direct question, the utility representatives confirmed that Watertown does not have the electric capacity for the massive 200-400 megawatt (MW) data centers currently making inquiries. Watertown's entire peak usage is approximately 80 MW.

Strategies for Growth and Collaboration

Panelists stressed the importance of cohesive, unified action across all organizations.

·         Calvin Park Partnership: A collaborative project involving the WDC, Utility, County, and City is underway to bring wastewater service to Calvin Park and nearly 300 acres of additional property. This project received an EDA grant with a 20% local match coming from the four entities.

·         Workforce Training: The panel consistently highlighted Lake Area Technical College (LATC) as the key partner for workforce development, with the long-term goal of working toward an engineering degree program to drive future growth.

·         Targeted Industry Attraction: The WDC is using labor force analysis data (conducted in 2024) to pursue specific target industries, including high-wage manufacturing, small-scale data processing (under 10 MW), and food/beverage operations, which will be possible once the wastewater plant expansion is complete.

·         Need for Speed: The consensus was that the main obstacle to a large-scale housing initiative is the community's inability to move quickly, with an urgent need to expedite implementation.

·         Investment Need: Chris Clifton, representing WDC leadership as Executive Director, closed by stating the organization needs to move from 50 private investors to 150 to meet future infrastructure needs, noting that the next 300 acres of land and infrastructure will cost an estimated $20 to $25 million. He further calculated that the community will require the investment and jobs equivalent to nine more Terex-sized operations to reach a population of 50,000 by 2050.