Ho-Chunk celebrates 20 years: From 1 person to $9.18M in 2013 profits

WINNEBAGO, Neb. - The Winnebago Tribe's town center was just an empty corn field 10 years ago.

Now, it's home to offices, a hair salon, a gift shop that sells local artwork, a restaurant, a Dollar General store and several tribal members, including neighbors Melanie Parker and Joi Long.

Parker and Long moved into Ho-Chunk Village a little more than a year ago after purchasing land and designing their homes just across the street from the new playground, where Long's grandchildren often play.

"It gives me a sense that I truly am here for life," Parker said. "It's mine. It's all mine."

The village and surrounding neighborhood with more than 30 homes and a few apartment buildings, were made possible by Ho-Chunk Inc., the economic development corporation of Nebraska's Winnebago Tribe.

Ho-Chunk is celebrating its 20th anniversary and, in that time, the company has grown from one person - president and CEO Lance Morgan - and no revenue to about 1,200 employees with more than 30 subsidiaries around the world and a record $9.18 million in profits in 2013.

"It's a lot different than when I was a kid," Morgan said of the Winnebago reservation in northeast Nebraska's Thurston County, where he lives in the newly developed village. "We were held together by some tough grandmothers with a couple bucks and a bad attitude."

Diversifying has been the key. Ho-Chunk Inc. moved the tribe away from traditional revenue sources like gaming, cigarettes and gasoline into a wide range of areas, most recently winning multimillion contracts to provide services for government agencies.

The company is wholly owned by the tribe but operates independently. Twenty percent of the company's profits go to the tribe to fund development of the village and infrastructure. The developments and subsidiaries also provide jobs for tribal members and others.

"You can't take an international corporation and headquarter it in a small town and not have positive social and economic impacts," Morgan said.

An example of that impact is the newly developed, $10 million Educare childcare and early education center, which replaced the two trailers previously used as a day care. Construction is also to begin this spring on a development of 14 apartment units above retail and office space, Morgan said.

On Friday, community leaders, Ho-Chunk officials and government representatives from Nebraska gathered at the village center for the company's 20-year celebration, which featured traditional Winnebago singers and dancers as well as remarks from Morgan.

"If I could pick one thing I'm most proud of, it's seeing a family move into a nice new home with a manageable payment," Morgan said. "My goal is not to build a one-hit wonder. My goal is to build an institution that can stand the test of time."

Parker, 37, grew up in Winnebago and lives in her new home with her 18-year-old son, her 12-year-old daughter and her mother. She can walk to the Dollar General and can see the Ho-Chunk Inc. offices, where she works as an operations office manager, from her new home.

Tribal Chairman John Blackhawk, who also sits on Ho-Chunk's board of directors, said about 200 people are employed locally by Ho-Chunk.

Morgan said Ho-Chunk competes for tribal members. "We have way more jobs than working-aged people in our community. To go from 60 percent unemployment to more jobs than people in one generation is phenomenal."

The business started out developing hotels in the Omaha area as well as gas and tobacco shops and used car lots on the reservation, but eventually diversified to include a construction company, modular homes, like those that Long and Parker live in, and two government contracting divisions, which have spurred much of the company's growth over the last year.

Morgan, a graduate of the University of Nebraska-Lincoln and Harvard Law School, was 26 when he took the helm of Ho-Chunk Inc.

"We had been doing stuff on the reservation, but gaming, gas and tobacco, there's no future in that," Morgan said. "I joked I wasn't going to go to the Harvard Law School reunion and tell them I sold used cars and cigarettes. It's a way for us to diversify away from controversial taxation-oriented issues."

The tribe still maintains ownership of the WinnaVegas casino resort in Sloan, Iowa, but Morgan said Ho-Chunk was forced to reduce its reliance on gaming after it was legalized in Iowa and there was too much competition.

"Our business dropped," Morgan said. "We learned very quickly that we had to diversify immediately, and we did it in a sort of state of emergency because we could see large casinos being built."

The company now has an office building in Bellevue, purchased about a year ago, and one in Sioux City, Iowa, as well as offices in several other U.S. states and three countries. The Bellevue office houses about 50 employees with All Native Group and Flatwater Group as well as PaySafe Escrow, a fledgling online escrow business that Ho-Chunk acquired last year.

Flatwater Group is the company's government products division, while All Native Group provides information technology and human resources services, among others, to the federal government.

In 2012, Flatwater Group recorded about $75 million in revenue. In 2013, it jumped to nearly $100 million. All Native Group had $65 million in revenue in 2013, down from just less than $80 million in 2012.

Over the past year or so, Ho-Chunk's government contracting divisions secured at least three contracts with the federal government. They are:

» All Native Solutions was awarded a $2.3 million contract with the Bureau of Indian Affairs in March. The company will provide furniture, fixtures, equipment and other services to the Riverside Indian School in Anadarko, Oklahoma.

» Ho-Chunk Technical Solutions, a subsidiary of All Native Group, was one of eight firms awarded a $99 million federal contract providing records management and informational technology services, among other services, to the U.S. Army Medical Materiel Agency last October.

» In June of 2013 All Native Inc. was awarded a five-year contract with a maximum value of $23 million with NASA Goddard Space Flight Center facilities providing human resources and information technology services, such as hiring, training and technology support.

About 2,500 people live on the reservation, which covers about 120,000 acres of cropland, woodland and pasture in Thurston County, Blackhawk said.

The tribe's share of the company's profits has grown along with Ho-Chunk.

"Many years ago we were very, very happy to receive $160,000 and that has since grown to almost $2 million annually," Blackhawk said.

Morgan said the business doesn't operate like a "normal company" because of its tribal roots.

"We do things from a business standpoint, but in my mind, sometimes it's a means to an end," he said. "Our job is to make things better - better in terms of economic opportunity, better in terms of jobs, better in terms of education.

"The average tribal member could care less if we made $10 million or $1 million, they don't think in those terms. They think, is my life better?"