WILLISTON, N.D. – Tax manager Gloria Jordan remembers the first woman who came into the accounting firm where she works with an oil royalty check for half-a-million dollars.
“She went to one of our accountants and she said ‘Is this real? What do I do?’” Jordan recalled.
The oil boom has brought new financial questions for individuals benefiting from the boom and new challenges for businesses that are rapidly expanding.
Businesses that have seen significant growth may have the bank call and tell them to remove $5 million from their checking accounts today, said Eide Bailly business advisor Jim Ramstad.
“The numbers have gotten so big and so large that it’s hard for the owner to really get a handle on really what is happening,” said Ramstad, who has been traveling from Fargo to the Oil Patch since 2011.
Williston accounting firm Voller, Lee, Suess & Associates merged with Fargo-headquartered Eide Bailly a year ago to add expertise and resources from other parts of North Dakota to keep up with the demand.
The firm had 12 employees before the merger. Now, nearly 20 work from the Williston office.
“Most of our clients were growing larger,” said partner Rick Lee. “It gave us the opportunity to keep our clients.”
Several Eide Bailly representatives travel monthly from Fargo, Bismarck and other branches to western North Dakota to work with clients and lead workshops, while the longtime local staff maintain the face-to-face contact.
Theresa Hall, a certified financial planner based in Bismarck, said many of her western North Dakota clients never anticipated they would become wealthy.
“All of a sudden, they have tens if not hundreds of thousands of dollars coming in every month and they don’t know what to do with it,” Hall said.
Hall advises clients on investing their new wealth and, in some cases, educates them on the legalities of mineral trusts that may have been established generations before companies began drilling.
Ava Archibald, who travels from the Fargo office, works with estate planning and business transfers.
One significant difference she notices with clients in the western part of the state is the faster pace, Archibald said.
“If you’re selling a business, people are moving, you’re ready to go and they want to buy now,” she said.
D.C. Lucas travels from Fargo to assist clients with technology needs. He finds that oil industry companies are so focused on getting more trucks out, renting more equipment and responding to daily demands that they may neglect the financial piece.
“Money’s not the issue, they’re doing fine there. The issue is the back office, whether it’s people or some of the expertise to guide their people in the right direction,” Lucas said.
Ramstad, who has been spending three out of four weeks in the Oil Patch, said companies he works with had huge growth in 2012 and saw a 10 percent to 15 percent decrease in 2013 as they took a pause to catch up. His customers expect growth next year, but controlled growth, not boom growth, he said.
When Ramstad first started driving out to Tioga and other western North Dakota communities, hotel rooms were scarce so he sometimes stayed with clients. Eide Bailly then rented an apartment for a year until hotel rooms opened up and staff began doing more work electronically.
Oil Patch clients are eager to learn and appreciative of the help, Ramstad said.
“This is by far the most fun place to work,” he said.