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South DakotaSecretary of State

Jason M. Gant

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S o u t h D a k o t a

EconomicReport

Summer

2012In this Issue:

Secretary’s Minute; priorities and the future. .....................1

Unemployments rates by State, and where South Dakota ranks. ......................2

New filing numbers.............3

The Secretary’s Spotlight....4

The Secretary’s MinuteMy fellow South Dakotans, it’s my privilege to provide the public with a 1st Quarter Economic Report and a 2012 preview for the state of South Dakota.

My priority in my second year as your Secretary of State is to make South Dakota the premier state in which small and medium-sized business will want to form and expand. We will achieve that by expanding our online services available to corporations. In a matter of months, entrepreneurs will be able to form a new business electronically through our website and instantaneously will be a registered corporation in South Dakota. I look forward to sharing more information with you about these efforts in future reports.

Where South Dakota Ranks

In 2011, the State of South Dakota ranked in the U.S...........

#1 – State tax systems for Entrepreneurship & Small Business

(Small Business & Entrepreneurship Council)

#2 – Best Small Place to do Business- Sioux Falls (Forbes Magazine)

#2 – Freedom in the 50 States – An index of personal and economic

freedom (Mercatus Center, George Mason University)

#3 – Top States for Credit (CardRatings.com)

#3 – Business Friendliness – the states were graded on the perceived

“friendliness” of their legal and regulatory frameworks to business

(CNBC)

#3 – State-Local Tax Burdens – taxes paid by residents divided by their

income (Tax Foundation)

Secretary Gant is touring the state, presenting the new “South Dakota Open for Business” website in an effort to both innovate and simplify business services.

If you would like to schedule a meeting with Secretary Gant for your organization or classroom, please contact us at 605-773-5008 or via e-mail at openforbiz@state.sd.us.

Data released by the U.S. Bureau of Economic Analysis shows that South Dakotans’ personal incomes grew by 6.2% in 2011, which was 5th greatest among all states.

South Dakota’s per capita personal income in 2011 was 21st highest in the nation, at $41,590, while South Dakota ranked 35th in the same category in 2001. Secretary of State Jason Gant attributed the growing personal income to one of the best tax climates in the nation, and businesses are taking advantage of it.

Personal Income

Rank State Rate1 North Dakota 3.12 Nebraska 4.03 South Dakota 4.34 Vermont 4.95 New Hampshire 5.26 Iowa 5.37 Wyoming 5.48 Minnesota 5.78 Utah 5.78 Virginia 5.711 Oklahoma 6.012 Kansas 6.113 Montana 6.214 Hawaii 6.415 Maryland 6.5

Unemployment Rates for States

The state of South Dakota as a whole saw a significant increase in gross sales for the month of January in 2012 as compared to the same month in 2011 and 2010. As you can see in the chart above, gross sales jumped by an astonishing $3 billion dollars for the month of January.

The chart above reflects the contin-ued success of the Secretary of State’s online business services. Of all the corporations that file annual reports, 79% of them have filed electronically.

New Filings Prior Year Current Value Change % ChangeFY 2011 (Jan-Mar) FY 2012 (Jan-Mar)

Corporations 445 475 30 6.74%Limited Liability Companies 1,040 1,244 204 19.62%Nonprofit Corporations 93 85 -8 -8.60%Limited Partnerships 40 61 21 52.50%Limited Liability Partnerships 22 21 -1 -4.55%General Partnerships 0 0 0 0.00%Total 1,640 1,886 246 15.00%

The South Dakota Secretary of State Economic Report is provided as a courtesy of the Secretary of State’s of-fice and is a compilation of business registration data from the Secretary of State’s office, and other applicable sources. For more information, contact South Dakota Secretary of State, Business Services, 500 East Capitol, Suite 204, Pierre, SD 57501, e-mail openforbiz@state.sd.us, or visit our website at www.sdopenforbusiness.com

Secretary’s SpotlightTop 10 Ways to Prevent Business Identity Theft

1. Sign up for email notifications by filing corporate annual reports on-line at the Secretary of State’s office, and we will send an email notifi-cation each time corporate documents are changed online.

2. Review your corporate documents regularly at the South Dakota Secretary of State’s website.

3. Make note of your annual report renewal date and make sure to up-date our office with any changes.

4. If you discover that changes have been made, contact the Secretary of State immediately.

5. Monitor your commercial credit report because the easiest way to detect possible identity theft is to monitor your company’s profiles with Dun & Bradstreet (D&B), Business Equifax, Business Experian, and TransUnion. (You should also take advantage of their email alert notifications so you are notified of any new activity occurring on your company credit files.)

6. If your bank offers electronic banking, use it, and monitor this ac-count closely.

7. Be sure to dissolve any business entities that you do not use or moni-tor. You will also want to contact any former creditors to notify them that you will no longer be applying for credit.

8. Limit the number of employees that have access to personnel files, credit cards, tax, EIN, and payroll information. Develop a shredding policy to ensure employees do not discard documents with sensitive identifiable information printed on it.

9. Use caution over the phone and on line: If you have not initiated contact with an entity, do not share personal or financial information even if they say they’re from your bank. If you must provide sensi-tive information such as employer identification numbers, account numbers, financial documents, or personal information via email or the web, make sure the site is secure and its certificate is up to date.

10. Your personal information is valuable. Protect it! Guard your Social Security number, bank and credit card numbers, your driver’s license number, EIN, Tax ID, and passwords.

For more information on Business Identity Theft, visit our website at: http://sdsos.gov/content/viewcontent.aspx?cat=corporations&pg=/cor-porations/identitytheft.shtm

The Secretary of State’s office, which oversees corporate registrations and filings for the state, wants to remind the public about the risks of business identity theft and identify ways to protect against this rapidly growing type of fraud.

“Prevention is the best strategy,” noted Secretary Gant. “It is my goal to make sure that we continue to deliver practical, cost-effective tools to help business owners maintain secure state business filing information and records. By giving businesses the resources they need to avoid becoming targets, we will also aid businesses in doing what they do best – creating jobs for South Dakota residents.”

“I urge all business owners in the state, including those who have inactive or defunct businesses, to take a few minutes and look up their company information at (SOS WEBSITE) to make sure that it is both current and accurate,” said Secretary Gant. “If you find any discrepancies or errors, it is extremely important to report these problems immediately.”

Currently, the Secretary of State’s business filing/registration systems notifies businesses via email whenever a new filing occurs, or when changes are made to the company’s business records held by the state. The system is designed to alert businesses that have requested notification to unauthorized changes in their data. Business owners may contact the Secretary of State office’s business services division by phone at 605-773-4845, or by email at openforbiz@state.sd.us

Secretary Gant is a member of the National Association of Secretaries of State (NASS) Business Identity Theft Task Force, a national panel that is working with state business registration offices to review the technological and policy-based solutions that are being employed to curb business identity theft. The panel is set to release a final report on its findings later this year.