Author Archives: Bob Mercer

About Bob Mercer

Bob Mercer is a newspaper reporter in Pierre where I cover state government, issues and politics for the Aberdeen American News and four other separately owned newspapers: the Black Hills Pioneer, the Pierre Capital Journal, the Mitchell Daily Republic and the Watertown Public Opinion. I began covering the Legislature in 1985 and have lived in Pierre since December 1986. I grew up in Wisconsin, worked my way through college, took my first full-time newspapers jobs in Wyoming, and have lived in South Dakota since the summer of 1984 when I moved to Aberdeen to join the American News. I worked for the Rapid City Journal as its state government reporter in Pierre from late 1992 through late 1998. I spent four years as press secretary and a senior aide to Gov. Bill Janklow during his fourth and final term from late 1998 through 2002. I returned to journalism in January 2003 as a self-employed reporter, providing state government coverage to the Mitchell, Watertown, Spearfish, Pierre and, depending on the year, Aberdeen newspapers. In 2008, the Aberdeen American News offered to hire me as full-time member of the AAN staff, with my reports continuing to be available to the Mitchell, Watertown, Spearfish and Pierre papers. The new arrangement has been in effect since January 2009 as the five papers continue their remarkable dedication to their readers and the general public, as the only South Dakota news outlets with a full-time reporter covering state government in Pierre throughout the year. In addition to focusing on the Legislature during the annual winter session and its various activities during the interim periods between sessions, I spend many days throughout the year -- traveling as often necessary -- to cover state government boards and commissions which oversee the state universities, technical institutes, outdoors, water, environment, business, public schools, banking, agriculture, utilities, health care and various other areas of public interest. I purposely don't register to vote because of my profession; the last time I recall voting in a presidential election was the first time, 1976, when I had just turned 18. I think I voted for Jimmy Carter over Gerald Ford. Make of that what you want, just don't make much of it.

Coffee’s brewing and so are the polls

Get ready for a flurry of final polling on South Dakota’s contest for a U.S. Senate seat. I expect at least three or four sets of fresh numbers coming out in the final week before the Nov. 4 election. There will be a Survey South Dakota set for the Aberdeen American News, KOTA and KSFY. The Sioux Falls Argus Leader and KELO release their numbers from Mason Dixon on Monday. I expect Nielson Brothers Polling from Sioux Falls will be out with a last look. Word is that Rasmussen Reports had a poll going in recent days. There might yet another out there too. All of it will add up to a wonderful look at what South Dakotans are thinking about the U.S. Senate contest (and several of the other statewide races and three ballot measures). From the group we will get a sense of where things stood as of 14 days or so before the election. From the longer-term projects such as Survey South Dakota and NBP we’ll also get a sense of the trends. What will be interesting — and I’ve never seen research on this, but I’m sure it’s out there — is whether these polling results then affect the voters and the outcome. Would a decline in one candidate’s support lead to further decline or to a resurrection of that candidate? Would a gain in another candidate’s support add to the candidate’s momentum? Would a candidate regaining some strength lead to a sense of “it’s over”? These are important questions, too, in these final days of this odd, odd contest.

U.S. 14B won’t get roundabouts — for now

The protests by people who move big things for a living — farm implements, houses, manufactured homes — produced a major revision in the state Department of Transportation’s plans for the U.S. 14B / I-29 interchange on the northeast side of Brookings. DOT wanted to install roundabouts on both sides of the 14B bridge over I-29. The goal was to ease traffic congestion in the coming years while DOT rebuilds the main U.S. 14 / I-29 interchange in the busy commercial district. After complaints, state Transportation Secretary Darin Bergquist spent time the past month contacting Brookings-area officials. The result is a revised plan that has local consensus. There will be traffic signals at the U.S. 14B interchange rather than roundabouts. The state Transportation Commission gave the final blessing to the change Thursday. But there are also three conditions to keep in mind. DOT officials said they don’t plan any major work on the U.S. 14B bridge to make it wider; they think the bridge has 30 years of good life remaining. Second, there’s no guarantee that roundabouts won’t be considered again at some future time. Third, a speed study will be conducted along that stretch of truck by-pass to see whether adjustments to slow traffic would be advisable.

The $600,000 that MMR did or didn’t approve

Depending on when and how you first read the story Wednesday, you might or might not think the Argus Leader reported that Gov. Mike Rounds in 2010 approved $600,000 of increases in Future Fund grants that were intended to find their way through a third party to the Northern Beef project in Aberdeen. Eventually $550,000 of the extra money did make it to Northern Beef, via a Future Fund grant to the South Dakota Development Corporation. After the public disclosure of the $600,000 of increases months ago, the manager of the Rounds campaign for U.S. Senate, Rob Skjonsberg, said Rounds didn’t approve the increases. That left Richard Benda as the man responsible for the increases. Benda was secretary of tourism and state development for Rounds from 2006 through early 2011. Benda died Oct. 20, 2013, of what was determined to be a self-inflicted shotgun wound to his abdomen. Rounds appeared Tuesday on the ’100 Eyes’ program run by the Sioux Falls Argus Leader. Reporter David Montgomery subsequently reported two seemingly new facts: Rounds knew Benda was going to work for a Northern Beef investor when Rounds approved a $1 million Future Fund grant that was to go directly to Northern Beef; and Rounds approved the additional $600,000 of extra money in two other Future Fund grants that went to South Dakota Development Corporation and then were to go to Northern Beef. If Rounds approved the $600,000, that contradicted what his campaign manager had said months earlier. Turns out the story was half-right: Rounds did know Benda was taking a job with a Northern Beef investor, but Rounds didn’t approve the $600,000 of increases. The $600,000 is significant because it is a piece in a broader scheme. Benda, days after his time with state government ended in January 2011, hand-delivered the $1 million check to Northern Beef. In turn Northern Beef diverted $550,000 from the $1 million and put the $550,000 into an escrow account with SDRC Inc. to pay for a loan monitor on the Northern Beef project. The loan monitor was Benda. Benda had signed a state contract in his role as a Rounds cabinet secretary with SDRC Inc. in 2009 to manage the EB-5 immigrant investor program for South Dakota. SDRC Inc. raised tens of millions of dollars in loan pools from South Korean and Chinese investors seeking favored visa treatment under the federal EB-5 program. One of those projects was Northern Beef. Where the extra $600,000 came into play was the money was supposed to reach Northern Beef. Of the $600,000 extra that Benda approved, $550,000 did make it to Northern Beef. The extra $550,000 amount exactly matched the $550,000 amount that Northern Beef diverted to SDRC Inc. to pay the salary for Benda and other expenses for two years. State Attorney General Marty Jackley disclosed in July of this year that he was prepared to arrest Benda and convene a grand jury on the $550,000 diversion as well as three double-billings for airline travel by Benda while in his state job. If Rounds had indeed approved the $600,000 of increases, that would have made him part of the plot to steer money from the state Future Fund through Northern Beef to SDRC Inc. to pay for Benda’s post-government job at SDRC Inc. All of this happened in the closing weeks of Rounds’ final term as governor during December 2010 and the first days of January 2011 before Dennis Daugaard took the oath as governor. Jackley said he had email proof that Benda arranged his job with SDRC Inc. in December 2010. Northern Beef opened for less than a year, shut down mid-2013 and filed for bankruptcy. At the time of his death one year ago, Benda had just started a new job with Heartland Consumers Power District at Madison. Meanwhile Daugaard’s replacement for Benda, Pat Costello, terminated the state contract with SDRC Inc. in September 2013. Not until after Benda’s death did any of the financial maneuvers come to public attention. The one missing piece is whether anyone who worked with Benda or in the Rounds administration has definitive knowledge of whether Benda acted on his own in approving the $600,000 of increases. The Argus Leader, by the way, did later change its story regarding the $600,000 on its web site.

Here are some top legislative contests

Maybe you already knew this, but five Democratic candidates for state Senate seats withdrew and weren’t replaced in time for the Nov. 4 ballots. They included Alanna Silvis of Watertown, who was challenging Republican incumbent Ried Holien of Watertown in District 5; Sherry Knutson of Sioux Falls, who was trying to unseat Republican incumbent Deb Peters of Hartford in District 9; Reynold Nesiba of Sioux Falls, who was taking on Republican incumbent Phyllis Heineman of Sioux Falls in District 13; Brian Kaatz of Sioux Falls, who was challenging Republican incumbent Deb Soholt of Sioux Falls in District 14; and Craig Kelly of Mitchell, who backed off against Republican incumbent Mike Vehle of Mitchell in District 20. Quite a pattern there. In House contests, where each party can field two nominees for two seats with top two finishers as the winners, the Democrats saw nine candidates withdraw; one Republican and one independent also withdrew.

So where are the top races?

One has to be the battle between Democratic incumbent Chuck Welke of Warner and Republican challenger Brock Greenfield of Clark for the District 2 seat in the Senate. Greenfield is currently in the House of Representatives.

Another has to be the showdown for the Senate seat in District 8, where Republican appointee Chuck Jones of Flandreau faces a big challenge from Democratic Rep. Scott Parsley of Madison.

A sleeper might be the Senate contest in District 16, where Republican incumbent Dan Lederman of Dakota Dunes is challenged by Democrat Ann Tornberg of Beresford.

A wide-open seat has two strong candidates in District 17 to succeed retiring Sen. Tom Jones, D-Viborg. The Democrat is Michelle Maloney. The Republican is Arthur Rusch. Both are from Vermillion.

There are some tough contests in the middle and western parts of the state.

In District 24, Republican incumbent Jeff Monroe of Pierre is challenged by Democrat Ruth Rehn of Pierre.

There’s a tussle in District 26, where Democratic Sen. Larry Lucas isn’t running because his family moved to the Pickstown area. A Republican former lawmaker, John Koskan of Wood, and a current Democratic lawmaker, Rep. Troy Heinert of Mission, are competing for the open seat.

Up in the northwest, Sen. Ryan Maher, R-isabel, is term-limited and couldn’t seek re-election for his District 28 seat. There’s nothing automatic about party lines in that area of South Dakota. (Maher served as a Democrat originally and later changed to Republican, winning from both sides.) Hoping to succeed Maher are Republican Rep. Betty Olson of Prairie City and Democrat Oren Lesmeister of Parade.

Most of the Republicans in Rapid City-area legislative seats are uncontested, but there’s one big Senate battle. Republican incumbent Phil Jensen of Rapid City is challenged by Democrat Robin Page of Rapid City for the District 33 seat.

There are quite a few House contests that have at least one former lawmaker running again and in some cases there are three current and former legislators competing for the two seats. We’ll look at some of those in a future post.

How did South Dakota match up in 2012 election process?

This is an amazing series of statistics and charts from the U.S. Election Assistance Commission regarding how South Dakota and the other states performed in operating their 2012 general elections. You can see the full report here. You’ll need some time to wade through all of it, because the report seems to measure almost everything except voters’ shoe sizes. In the meantime we’re waiting for the new voter-registration numbers for South Dakota from the secretary of state’s office. These will be the final registration tallies for the Nov. 4 elections. Registration closed Monday.

Required reading: Ross on EB-5 meeting at Capitol

Every newspaper reader and broadcast listener or viewer in South Dakota deserves the kind of journalism that reporter Denise Ross delivered to the The Mitchell Daily Republic in her story Oct. 17 about a meeting at the state Capitol regarding Northern Beef, EB-5, foreign investors, Joop Bollen, Richard Benda, then-Gov. Mike Rounds and others. The story can be seen here. Here’s is an excerpt that summarizes the story’s mood and tone:

“Gov. Rounds has no recollection of this meeting ever taking place,” wrote campaign spokesman Mitch Krebs in an email to The Daily Republic.

This is symptomatic of what led Katie Zerr of the Mobridge Tribune newspaper to recently write a hard-hitting commentary about Rounds here.

Some Rounds supporters are dismissing news reports about EB-5 as attempts by reporters to “get” Rounds. Reporters working on EB-5 stories are out to get the truth, or at least more of the truth, about the secretive immigrant investor program that was operated for profit during the Rounds’ administration with his blessing. EB-5 activity was discontinued by the Daugaard administration in September 2013.

Read the Ross piece in the Daily Republic. It will tell you things no other reporter previously knew about Northern Beef and EB-5.

Pressler’s independence defended by magazine

Bloomberg Businessweek magazine came to the aid of former Republican U.S. Sen. Larry Pressler of South Dakota and Greg Orman of Kansas in their candidates as independents for the U.S. Senate. The magazine, in an editorial headlined “Let Independents Be Independents,” said it is “ludicrous” there are demands they identify which political caucus they would join — Democratic or Republican — if elected to the Senate on Nov. 4. Here’s the closing excerpt from the Oct. 20 issue:

“Orman and Pressler have nothing to gain and everything to lose by announcing a party affiliation now. Doing so would undermine part of their campaigns’ raison d’^etre: rejecting the partisan war in Washington.”

(That’s “reason for existing” for those like me who don’t speak a sentence of French.)

Libertarians take positions on ballot measures

Emmett Reistroffer, chairman for the South Dakota Libertarian Party and the party’s candidate for South Dakota secretary of state, issued a statement in his role as chairman regarding the three statewide ballot measures on the Nov. 4 ballot. The statement urges voters to consider yes votes on two and a no vote on the other. Reistroffer spoke in support of Amendment Q, which would allow Deadwood casinos to offer roulette, keno and craps, and Initiated Measure 17, which would require health insurers to include all qualified health care providers who want to be on their provider lists. He spoke against Initiated Measure 18, which would raise the minimum wage from $7.25 to $8.50 per hour and provide automatic cost-of-living increases. The South Dakota Democratic Party worked to get the minimum-wage measure on the ballot.

A Mike Rounds birthday party will be held on the one-year anniversary of Richard Benda’s death

I swear I am not making that up. A flyer arrived in today’s mail letting us know that a birthday party will be held Monday, Oct. 20, for Mike Rounds at Oahe Marina, the concession operated below Oahe Dam by one of Mike’s brothers, Steve Rounds. The get-together runs 5:30 to 7 p.m. and there will be barbecues, chips, cake and beverages. Monday, Oct. 20, also is the one-year anniversary of the death of Richard Benda, who was secretary of tourism and state development in the Rounds administration.

Benda’s death came, we now know, as he was facing possible arrest and criminal prosecution for theft related to the immigrant investor program known as EB-5 in the Rounds administration.

Rounds has repeatedly denied he approved the extra $550,000 that found its way from the state Future Fund to Northern Beef, an EB-5 project, and then to SDRC Inc.. The Aberdeen-based SDRC Inc., run by Joop Bollen, was given the EB-5 management contract for state government in 2009 by Benda. The extra $550,000 was to pay SDRC Inc. for a loan monitor on the Northern Beef project. The loan monitor was Benda, after he wasn’t retained in the new Daugaard administration that took office in January 2011. All of the money arrangements and the job arrangement came after Benda knew he wouldn’t be in the Daugaard cabinet.

Benda’s death resulted from a shotgun wound to the abdomen, using a stick to fire the gun, and was ruled a suicide. For a few minutes today, after seeing the flyer, I thought Benda had killed himself on Rounds’ birthday. And then I wondered, coincidence or intent? So I I checked the Legislative Research Council historical register and found that Rounds’ birthday actually is Oct. 24. He was born in 1954. He is about to turn 60. Benda was 59 as well when he died.

UPDATE: The South Dakota Republican Party paid for the birthday flyer, according to the statement on the flyer.

Who might fill Dusty’s shoes?

Let me say five things.

First, I always liked (and still like) Jim Burg as a public official and as a person, so I was disappointed when he lost his re-election run in 2004 for the state Public Utilities Commission. At the same time, he acknowledged the fire to campaign wasn’t as strong as it once had been, and his Republican challenger, Dusty Johnson, certainly had that fire. Jim Burg’s defeat marked one more state government post lost by a dwindling number of Democrats and one more step away from the benefits of two-party government.

Second, I was impressed with the effort and the ethics of Dusty Johnson while he served on the PUC. It is a demanding and grinding job, and to do it well, you must demand much of yourself. He did. He was part of a trend toward an even higher level of professionalism by the commission.

Third, I was disappointed when Dusty — everybody just calls him Dusty — accepted an offer to be the governor’s chief of staff after he had just won re-election to the PUC in 2010. I understand the allure of the governor’s office, including the opportunity to try to make South Dakota a better place, and I understood why he would want to test himself in the job. I just didn’t like that he was walking away immediately from a job the voters had just entrusted to him again at the PUC.

Fourth, Dusty Johnson performed beyond anyone’s expectations as chief of staff. I received an email from him at 2:33 a.m. today. I don’t know if he was working late or working early, but he was working at 2:33 a.m. The personal attention he paid to difficult situations throughout state government helped ensure the right things were done and the right people were in place to see that things would be done right in the future. Almost all of this happened outside the view of the general public. He helped spearhead some special projects that truly will make a difference in the long run for South Dakota. One that immediately comes to mind is the judicial sentencing reforms that were a joint effort between the executive and judicial branches with the support of the Legislature. Dusty’s boss, Gov. Dennis Daugaard, has accomplished a lot in his first term, and probably more than he promised. People such as Dusty Johnson played big parts in that.

Fifth, it is too bad for South Dakota that Dusty Johnson is stepping aside as chief of staff effective Nov. 7, just days after the general election. There isn’t any guarantee that Daugaard, the Republican candidate, will win a second term against the Democratic nominee, Rep. Susan Wismer, or independent candidate Mike Myers, but survey after survey indicates Daugaard looks to be in strong shape. Johnson is heading back to Mitchell, and ending the two-city two-household life of a job in Pierre and a family in Mitchell, to work for Vantage Point Solutions. His regulatory experiences from the PUC and the governor’s office will serve him well in working on Vantage Point’s consulting services to clients. He will be difficult to replace on the Capitol’s second floor.

There are others in the Daugaard administration who served in the role of chief of staff in previous times, such as Jim Hagen and Jim Soyer, who held the post during different points in the late Gov. Bill Janklow’s administrations. There are some highly capable people in senior positions on Daugaard’s staff and in his Cabinet. It takes a special person to be a chief of staff. Selflessness and stamina and creative simplicity are three important traits. Knowledge of the legislative and budget processes is important too. So is a personality that is simultaneously level-headed and upbeat. Jim Hagen, Jim Soyer and Dusty Johnson, to name just three, had all of those characteristics.

Dusty Johnson gave a lot to South Dakota. It’s probably only fair now that South Dakota gives him back to his family.

If I don’t see you before Nov. 7, let me say here: Good luck! and thanks.