Forum Person of the Year: Denny Sanford had the biggest impact on the area in 2010

• Denny Sanford is The Forum’s fifth Area Person of the Year.

Denny Sanford is The Forum’s fifth Area Person of the Year. Forum file photo

Talk about it

The Forum’s Area Person of the Year for 2010 is someone rarely seen here, though his name is everywhere and his wealth and vision played major roles in shaping what used to be Fargo MeritCare Medical Center into the region’s largest hospital system.

“I’m dramatically honored and thrilled,” Denny Sanford said in an interview done by phone.

Sanford has homes in Arizona, California and Colorado, as well as in Sioux Falls, S.D., where he built a good share of his fortune as head of First Premier Bank and Premier Bankcard, a credit card company.

In 2007, Sanford donated

$400 million to what was then Sioux Valley Health system, based in South Dakota. Sioux Valley was quickly renamed Sanford Health in honor of its benefactor.

Sanford Health merged with MeritCare Medical Center in late 2009 to become Sanford Health & MeritCare.

The name was later shortened to Sanford Health.

The first year of the merger has proven transformational for what company officials call “legacy MeritCare.”

Tradition of giving

Sanford Health added more than 500 positions in Fargo since the merger and 1,000 more are called for in the company’s next budget.

Sanford Health also announced several building projects and embarked on a philanthropic path:

• It donated $10 million to help remodel the Bison Sports Arena, which in time will be renamed the Sanford Health Athletic Complex.
• It pledged $6 million to help cover costs of a new YMCA fitness and wellness center at the Urban Plains complex.
• It plans to eventually commit $8 million a year to a biotech research facility in North Dakota State University’s Research and Technology Park located in the former Alien Technology building. And company officials hint there may be news soon regarding vaccine research.
• It budgets millions for giving to groups such as the F-M Symphony and Little League baseball teams.
• It recently announced plans to build a new clinic near the interchange of 34th Street South and Interstate 94 in Moorhead.
• And the biggest project of them all is a $300 million medical center planned for an area south of Interstate 94 between 45th Street and Veterans Boulevard in Fargo.

Many of the things listed above, including the new campus and the emphasis on supporting research in the Fargo-Moorhead community, are possible thanks to Denny Sanford’s initial $400 million gift, said Kelby Krabbenhoft, president and chief executive officer of Sanford Health.

Krabbenhoft said Sanford has donated another $200 million to the hospital system that bears his name since his original donation.

Hands-off role

When he gave his $400 million gift, Sanford made it clear he had no intention of taking a management role at Sanford Health, Krabbenhoft said.

“This is a guy that has made, by virtue of his resources, a lot of things possible. But, he’s got his own companies to run,” Krabbenhoft said, adding that Sanford Health is controlled by a board of 21 trustees. Krabbenhoft is one of the board members.

Ten of the other board members are from the Fargo region and 10 are from South Dakota.

But, while Sanford holds no official title or role in running Sanford Health, he was and remains instrumental in the company’s pursuit of important initiatives, Krabbenhoft said.

He said Sanford’s gifts provided the financial bedrock for the compensation and benefits Sanford Health employees receive and they helped make possible technical and transportation systems set in place since the merger.

That includes a pair of buses that shuttle Sanford Health workers between facilities in Fargo and South Dakota five days a week.

On a given day, riders may include neurosurgeons or maintenance workers.

“Every job has been on that bus. It’s become sort of our unofficial icon,” Krabbenhoft said, adding that the bus is one way Sanford Health works to establish uniform standards across an organization that employs nearly 20,000 people.

Seed money

Asked if the merger, and all that has followed, would have happened without Sanford’s gift, Krabbenhoft said:

“It would have been possible, but extremely difficult. We wouldn’t have been bringing to the table the necessary stability for all our people and our business functions to make it attractive to both sides.”

He said Sanford’s gifts, combined with historical “legacy” resources from MeritCare and Sanford Health, were pooled and invested almost exclusively in low-risk bonds.

The income, about $50 million a year, is earmarked for major initiatives.

“There’s no way, right now, that we’re spending $50 million a year on those things because we’re still developing them,” Krabbenhoft said.

Children first

Sanford said the focus of his donations is to help children

“If you can give young kids health, you improve their chances and really magnify the impact of all of the good work that Sanford Health is doing,” he said.

Sanford, who supports research into Type 1 diabetes, said there will be an announcement in early 2011 regarding a new effort to combat Type 2 diabetes “that is going to be very far reaching, nationally and internationally.”

He was born in St. Paul and graduated from the University of Minnesota, and spent several summers in North Dakota during high school and college.

“One was in Kindred, working on the Great Northern Railroad. The next summer, I was up in Minot,” said Sanford, who added he used to have a hunting cabin near Oakes, N.D.

He said a chemical company he once owned provided various materials for concrete projects in North Dakota, including the building of missile silos.

“North Dakota has clearly been in my past and hopefully in my future,” Sanford said. He recently added his name to a list of individuals, including Bill Gates and Warren Buffett, who have pledged to give away at least half of their wealth.

Going for broke

The promise reaffirmed Sanford’s previously expressed vow to give away all of his money and opened the door for some good-natured one-upmanship.

“I’m trying to get Bill Gates to join my club, which is the die-broke program, rather than just a pledge of 50 percent,” Sanford said.

Asked how much of his own treasure remains, Sanford said it is substantially less than what he has given away.

“Probably over a couple hundred million,” he estimated, without a note of regret. “I’m getting a great return on my investment.”

Sanford said of the things his giving has helped make possible, he is particularly excited about the new medical campus planned in Fargo.

“That’s going to have a major impact on the entire community.” He stressed that he derives satisfaction from results, not name recognition.

“The payoff is better health. I’m not doing it just to put my name on things,” Sanford said.

So how does someone born to a family of modest means amass such a fortune?

Krabbenhoft said Sanford, whom he considers a close friend, has a very competitive spirit that compels him, at age 75, to compete in golfing with every expectation he will win.

“He’s just a very active guy,” Krabbenhoft said. “I’m probably 25 years his junior, and I can’t keep up with him.”

On the other hand, Krabbenhoft said his friend can also be very easygoing. “He’s very comfortable in my pickup, that’s how we drive around.”

Krabbenhoft said that for the sake of efficiency, Sanford has a corporate jet and provides one for Sanford Health officials, “so that we can come and see him without worrying about the expense and also so we can get around within our own system.”

Stand by for news

When it comes to his future giving, Sanford made it clear Sanford Health will figure prominently, but for now he’s staying mum on the particulars.

Krabbenhoft said if Sanford Health receives more gifts, it will be because the money it has already received was put to good use.

“We’ve learned very quickly that you have to execute very well and you have to do it with class,” he said. “That has really led, I think, for an opportunity to go forward.”

Brian Mortenson, president of the Sanford Health Foundation, agreed, stating that every donation might be viewed as a vote of confidence.

“Denny has always been an investor who looks at value, a return on investment,” Mortenson said. “He needs to feel a sense of confidence in the folks who will get it done.”

Trust comes into play, according to Krabbenhoft, who said agreements with Sanford have the fewest pages of any he signs.

“It has just become a great team relationship with Denny,” Krabbenhoft said. “I don’t think there’s any question that we are Denny’s second family.”

About this distinction

The Forum Area Person of The Year recognizes someone who sparked changes and discussion that most influenced our area this past year. The Forum’s selection was made by editors after receiving readers’ suggestions. The following are past Person of the Year winners:

2009: Fargo Mayor Dennis Walaker, for helping lead the flood fight.

2008: Fargo-Moorhead youths for their many volunteer efforts to better the community.

2007: Tracy Briggs, WDAY radio personality and lead organizer of WWII Honor Flights.

2006: Joseph Chapman, former North Dakota State University president, for leading the university to a higher profile.

Readers can reach Forum reporter Dave Olson at (701) 241-5555

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