Monthly Archives: March 2016

2016 legislative session: Day 38 “…the things he truly feels…”

You can do the cross-check yourself. When the buffer-strips bill went through the state House of Representatives for the first time, back on March 7, the vote was 58-9. But after Gov. Dennis Daugaard issued a veto last Friday, the support in the House unraveled for SB 136. The Senate still stuck with Sen. Jim Peterson, D-Revillo, voting Tuesday to override the veto 32-1. But the House became a different story. Twenty ayes disappeared when the House voted on the override. The tally was 37-28 but a two-thirds majority of 47 was needed. For Peterson, who watched from the House gallery with his wife, Jane, the bill’s demise marked the end of his legislative career after 14 years as a representative and a senator. The goal of the buffer strips measure was to give farmers a tax incentive to plant grass up to 50 feet wide at the edges of crop fields next to water bodies and catch much of the soil and chemicals from running into the water. He did reveal during his Senate argument Tuesday a detail from his life: The falls on the Big Sioux River at Sioux Falls was where he proposed to Jane. Somebody should have told the House. The veto vote on SB 136 was the last action of consequence by the House on the final day of the 2016 regular legislative session.

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DOT wants rally speed limits changed

After the Legislature inserted the 80 mph speed limit for interstate highways in the 2015 package of tax and fee increases for roads and bridges, the state Transportation Commission made adjustments to slow traffic down in the Sturgis area during the annual August motorcycle rally. The commission now is considering further revisions to those temporary speed limits that apply to I-90 as well as SD 34 and SD 79. The commission plans a public  hearing Thursday, April 28, in Pierre at 9:30 a.m. CT at the Becker-Hansen Building, 700 E. Broadway Ave.

The proposed changes would shorten the time period for the temporary limits and would expand the miles of highway to which the limits apply.

Currently the temporary limits start July 24 and continue through August 15. The proposed dates call for the temporary limits to start each year on the Thursday before the first full weekend of the rally and continue through the Sunday of the second full weekend of the rally. The rally traditionally ends on that second Sunday.

As for the temporary speed limits, the proposed changes are:

I-90 would be 65 mph starting west of Sturgis at milepost 28.9 and continue east past Sturgis for the entire distance to Rapid City at milepost 55.02. The temporary speed-limit zone currently runs from milepost 28.9 to milepost 33.75;

SD 34 wouldn’t see a change in its temporary speed limit of 35 mph from Blanche Street east for 3.8 miles; and

SD 79 would see its temporary speed limit of 45 mph extended by 0.25 miles farther north to cover the Iron Horse Campground entrance. Currently the 45 mph temporary zone starts at the intersection with SD 34 and covers 1.5 miles north.

The commission is accepting written comments on the proposed changes. The commission set a deadline of April 27 for their receipt.

Registered mail option remains available

I incorrectly reported that petitions by legislative candidates must be in the secretary of state office by 5 p.m.Tuesday, March 29. The late-filing option remains available using registered mail. Petitions filed by registered mail must be mailed before 5 p.m. Tuesday. I apologize for the error. Last year the Legislature changed the law to remove the late-filing option, because petitions continued to straggle for days after the 2014 filing period closed, but I had forgotten the change was part of legislation that was referred to a statewide vote this November.

A Democratic surge?

South Dakota Republicans have their fight over their party’s direction in the June legislative primary elections. We’ll have a clear view come Wednesday, after the 5 p.m. CT Tuesday filing deadline for candidates. In the meantime, it must be noted that South Dakota Democrats are showing a surge of candidates for the Legislature. They’re fielding slates for the two House seats and one Senate seat in many districts in the Big Sioux and James valleys, helped by at least four Democratic former legislators — Susan Wismer of Britton, Kathy Tyler of Big Stone City, Dan Ahlers of Dell Rapids and Quinten Burg of Wessington Springs — making return bids. Republicans have some comeback candidates as well such as Lance Carson of Mitchell, Ryan Maher of Isabel, Mike Buckingham of Rapid City, Charlie Hoffman of Eureka, Chuck Turbiville of Deadwood and Larry Rhoden of Union Center.

From textbooks and software to tuition aid

It took Sen. Phyllis Heineman two years to win the Legislature’s approval to allow government aid to flow indirectly to nonpublic schools. On Friday, Gov. Dennis Daugaard revealed that he had signed SB 159 into law. It isn’t known whether opponents might take the next step of attempting to refer the measure to a statewide public vote. For Heineman, R-Sioux Falls, the victory was a test of patience. The Senate deferred consideration of her bill this year seven times before approving it 24-11 on Feb. 24.

That she was serious about the concept couldn’t be mistaken. In the 2015 legislative session, SB 189 was the only piece of legislation on which she was prime sponsor. It called for the similar concept. Last year she had to fight to get the bill out of the Senate committee and then won Senate approval 23-12. But it died in the House of Representatives last year, caught up in a final-days procedural jam, after a House committee initially rejected it and then had to be forced by House vote to release it to the full chamber. There, the House failed on a 31-31 vote to put it on the debate calendar.

In the House of Representatives this year, the bill’s supporters did a much stronger job of gathering co-sponsors. The 2015 version had 19 House members with their names on the sponsor list, with House Republican leader Brian Gosch of Rapid City at the head. The 2016 version again had Gosch as the House lead sponsor but this time the House list contained 32 names. The 2016 version again stalled in a House committee and Gosch needed to revive it through the smoke-out procedure. Once before the full House, SB 159 won approval 45-23.

Despite the argument from Rep. Timothy Johns, R-Lead, who is a retired circuit judge, that the legislation would violate several provisions of the state constitution, the House didn’t hesitate. The legislation offers a state tax credit of up to 80 percent to insurance companies that donate to non-profit organizations that in turn offer tuition assistance to lower- and middle-income families whose children attend nonpublic schools. The state constitution prohibits state assistance to sectarian institutions.

The argument made by Rep. Lee Schoenbeck, R-Watertown, was a recitation of the history of other decisions in South Dakota that blurred the line between public and non-public K-12 education. There was the sports-competition decision, with a single organization now overseeing competitive activities between all high schools that want to be members. There is the series of school textbook decisions, where textbooks and other instructional materials can be loaned by a public school district to non-public schools and home schools.

The roots of the Heineman-Gosch tuition-aid bills can be traced to a 2012 decision by the Legislature. That year, Sen. Heineman and Rep. Gosch were the prime sponsor and lead sponsor respectively on legislation that expanded the definition of non-sectarian textbooks that could be used in non-public school settings. Digital material was added to the definition, although a line was drawn to specifically exclude computer hardware. The Senate adopted SB 186 on a 34-0 vote, followed by the House 62-3.

Heineman is retiring from the Legislature this year. She has served 15 regular legislative sessions after her appointment in 1999 to a vacancy by then-Gov. Bill Janklow. Gosch is term-limited in the House, where he’s served nine years, after a 2007 appointment to a vacancy by then-Gov. Mike Rounds. Gosch serves in the same legislative district (32) as Sen. Alan Solano, R-Rapid City, who has filed to be a candidate for re-election. The deadline for candidates to file for the legislative primary elections is 5 p.m. CT Tuesday, March 29.

Gov. Dennis Daugaard had asked the state Supreme Court for an advisory opinion this year on SB 159 after it received final legislative approval. He wanted to know whether it would be in conflict with the state constitution. The justices turned down the request (and his request regarding SB 136, the buffer-strips tax-break bill). Without the court’s guidance, Daugaard exercised the power of his office and signed SB 159 into law.

One overlooked provision in SB 159 is the identity of the insurance companies will be confidential and the tax credit won’t be subject to outside review. This is different policy than currently in effect for other tax breaks for business projects.

Daugaard vetoed another measure, SB 100, on Friday that sought to provide tax breaks for broadband infrastructure investment in some situations. He said those tax-rebate decisions should be made in the same fashion as other businesses that have to apply to the state Board of Economic Development. That board’s decisions are made in public meetings, albeit after executive-session discussions. The final version of the legislation appeared to put the final decision with the board, through an amendment made by Rep. G. Mark Mickelson, R-Sioux Falls, but the governor didn’t think so.

The Legislature wanted business-project tax rebates to be open to public knowledge, after years of secrecy and automatic decisions within the state Revenue Department, when the current provisions were adopted in 2013 giving the decision authority to the Board of Economic Development. The tuition aid tax credits won’t be open to public knowledge.

Noem officially is a candidate w/update

U.S. Rep. Kristi Noem is officially listed as a candidate for re-election by the secretary of state office as of today (Thursday). Noem, a Republican, is the only congressional candidate at this point. She is expected to be opposed by Democratic legislator Paula Hawks. Neither U.S. Sen. John Thune, a Republican, nor Democratic challenger Jay Williams is officially listed yet.

UPDATE: Sen. John Thune filed his candidacy papers Friday.

Veto countdown: Two days left…

The governor didn’t announce any bills signed or vetoed today (Wednesday). That leaves Thursday and Friday for learning the fates of the 14 bills still on his desk awaiting action. He’s likely made up his mind. Will there be vetoes among them? The South Dakota Supreme Court set aside his requests for advisory opinions on SB 136 and SB 159 (we haven’t seen the court’s explanations, if any). So we know those two pieces of legislation at least were on his do-consider list. But there are some odd bills still on his desk too. For example, why wouldn’t he have already signed the education property-tax levies into law, when the measure – HB 1044 – is an administration bill? There’s a certain level of camouflage in play by holding back more bills than will be vetoed. But we probably will know by noon Friday where all of the remaining pieces of legislation stand. Legislators return Tuesday, March 29, to take up any vetoes before the final gavels fall on the 2016 session.

Sorting through the conflicts legislation

The EB-5 immigrant-investor scandal was the motivation for HB 1064 in the 2015 legislative session. The Mid-Central Educational Cooperative scandal was the motivation for HB 1214 in the 2016 legislative session.

They are two somewhat similar pieces of legislation but they aim at two somewhat different situations.

HB 1064 is intended to deter and penalize self-dealing by state government employees on state contracts and property. In the instance of EB-5, back in 2009, two state employees conspired to steer administration of South Dakota’s program into the private sector. Richard Benda, the secretary of tourism and state development, signed a management contract for SDRC Inc., the private business started by Joop Bollen. Until then, Bollen ran EB-5 for Benda’s department. Bollen left his state job for SDRC Inc. There were various EB-5 projects including the Aberdeen beef plant. Benda, according to state documents, arranged for state grant money to flow to Northern Beef, which in turn provided money to SDRC Inc., where Benda went to work after he was relieved of his Cabinet post in the transition from the Rounds administration to the Daugaard administration at the end of 2010. Benda allegedly committed suicide by shooting himself with a shotgun in the abdomen in fall 2013; we later learned that state Attorney General Marty Jackley was preparing to take the grant matter to a grand jury.

Rep. G. Mark Mickelson, R-Sioux Falls, sponsored the self-dealing legislation in 2015 after legislators received various information about EB-5 in 2014. Prior to the 2015 legislation, appointed state board members were allowed to have business conflicts. The legislation didn’t close that window. The legislation changed violations by state employees to a higher misdemeanor, from class 2 to class 1. Prosecutors in South Dakota often don’t pursue misdemeanors. The attorney office generally doesn’t at all. The attorney general and his staff weren’t publicly involved in the legislative activity regarding HB 1064 in 2015.

The Mid-Central debacle involving GEAR UP federal funds prompted the much broader reach taken by Mickelson and other legislators this year in HB 1214. It specifically rolls more than 20 state boards into conflicts regulation and requires public disclosure regarding conflicts and official decisions whether the conflict can be allowed. Whether this would have applied regarding GEAR UP isn’t clear. The GEAR UP director, Stacy Phelps, served on the state Board of Education. However, the board doesn’t deal directly with contracts. Those are administrative decisions that ultimately rest with state Education Secretary Melody Schopp. However, the second half of HB 1214 would have applied to GEAR UP. The legislation requires similar disclosures and decisions regarding business conflicts for school board members and various other key officials for any education organization that receives funding through state government. The state Department of Education receives federal funding for GEAR UP and provides the money to Mid-Central at Platte; Mid-Central in turn sent some of the money to two non-profits. Phelps received money from Mid-Central directly and from a non-profit, American Indian Institute for Innovation, for which he was the chief executive officer.

The business manager and an assistant business manager at Mid-Central, the husband and wife duo of Scott and Nicole Westerhuis, also served in various capacities for the two non-profits. Phelps now faces state criminal charges involving contract documents. The Westerhuises and their four children are dead after the murders, arson and suicide by Scott Westerhuis on Sept. 17, 2015, hours after Schopp informed Mid-Central director Dan Guericke tha GEAR UP contract wouldn’t be renewed with Mid-Central. Guericke now also faces state criminal charges regarding contract documents that allegedly were falsified in the days before and weeks before the termination as a state audit proceeded into its second year. Also facing state criminal charges regarding theft is another assistant business manager from Mid-Central, Stephanie Hubers, who reportedly received additional pay without doing work for AIII for several years. Jackley said last week during a public meeting and news conference in Platte that more than $1 million of GEAR UP funding appears to have been diverted to other purposes.

Mickelson and other legislators said repeatedly this year they don’t want to curtail citizen participation on state boards because the expertise and perspective from the private sector is valuable. Again, neither the attorney general nor his staff became involved in the public legislative activities; Mickelson said this week he never heard from them on HB 1214.

Another piece of legislation that aims to address some of the gaps that allowed the GEAR UP mess to develop is SB 162, brought this year by Lt. Gov. Matt Michels at the governor’s direction. It created a state Board of Internal Control and requires deeper monitoring of grants, including a rigid set of conditions for grant recipients. The attorney general said he wasn’t invited to participate in its assembly. The attorney general and his staff didn’t testify at its legislative hearings; in fact, no one other than the lieutenant governor did.

These three bills were big steps for state government regarding anti-corruption and public-integrity efforts. Two things are striking.

None of the three bills involved the attorney general, who has the responsibility to enforce the laws. Given that crucial role, it would seem legislators and the governor would want the advice of the attorney general. And it would seem the attorney general would want to offer observations or suggestions.

At the very least, he could have offered me-too testimony at the legislative hearings and offered suggestions. That’s often how much legislation goes through the process. Lawmakers introduce bills, and supporters and opponents testify, and legislative committees or legislative bodies decide whether changes would be better. That hasn’t happened regarding legislation that attempts to clean up criminal activity involving state government.

But conditions get complex when a legislator and an attorney general are raising hundreds of thousands of dollars toward their 2018 campaigns for the Republican nomination for governor. Sides are taken in the Legislature and perhaps in the administration. We saw the vehicular-homicide legislation sought by the attorney general this year take the shape of a football that was eventually punted into the stands by a legislative conference committee that decided to agree it couldn’t agree.

The attorney general wants to have a discussion about how to proceed with future legislation. He wants to consider penalties that rise into the felony range, depending on the situation, regarding unreported business conflicts. The Legislature’s Executive Board could set the stage for the discussion through an interim study.

The other thing that comes to mind is a gap that exists in the annual auditing process. There’s nothing that requires the auditor general to send an advance copy of the annual report to the attorney general before it is publicly released. There’s nothing that requires the attorney general or a member of his staff to review the audit findings before they are publicly released — or ever, for that matter. There’s nothing that required a state agency to alert the attorney general, either.

In the instance of Mid-Central, the state audit was publicly available for months, and news stories appeared in those months, before the Sept. 17 tragedy at the Westerhuis home. The audit work had been continuing, and the Legislature’s Government Operation and Audit Committee had started its look. The Sept. 17 killings and fire turned a financial probe into a crime scene that then brought in the attorney general and state investigators.

The lieutenant governor’s legislation does now somewhat address that gap. There is a requirement that employees shall report suspicious activity to the employee’s immediate supervisor, the attorney general or the auditor general. In the case of Mid-Central, a variety of people in state government and at Platte knew for more than a year before the killings that something was awry. And, no offense to state auditors or administrators in the state Department of Education, but a Division of Criminal Investigation agent seems to get and keep a person’s attention. Just knowing that an audit finding would be read by someone in the state attorney general’s office every time would probably be a deterrent in itself.

The switch-up in District 5

It’s true Sen. Ried Holien, R-Watertown, had already filed his candidacy paperwork for re-election. But we live in a free country where people get to change their minds — and wanting more time with your children rather than being in Pierre much of the winter is a pretty good reason. The decision by Ried to officially withdraw Tuesday created an opening that Rep. Roger Solum, R-Watertown, now hopes to fill. Roger was term-limited in the House after being elected four consecutive terms and he didn’t plan to challenge Ried. Roger is shown below with one of his political allies in the House. Rep. Tona Rozum, R-Mitchell. Ried is shown testifying to the Senate State Affairs Committee in his attempt to win an optional sales tax for county governments to use for specific projects (the committee didn’t endorse his bill).

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Republicans and Democrats pick their S.D. delegates to their national party conventions

We just had two very important elections this past weekend in South Dakota, as Republicans and Democrats picked their delegates to their national political-party conventions this summer. Of course, they’re important only if things go wacky and 1) Donald Trump isn’t chosen by Republicans on the first ballot and 2) Hillary Rodham Clinton somehow isn’t available to be chosen by Democrats on the first ballot.

South Dakota Republicans pick a slate of delegates that must follow the result of the June 7 statewide Republican presidential primary — but only for the first ballot. Those lucky folks heading to Cleveland in July are (with hometowns for those who jump to mind):

Pam Roberts (State Party Chair), Pierre.
Dana Randall (National Committeeman), Aberdeen.
Sandye Kading (National Committeewoman), Rapid City.
Anne Beal, Colman
Jim Bolin, Canton.
Matt Bruner, Winfred
Char Cornelius, Aberdeen.
Dennis Daugaard, Pierre.
Linda Daugaard, Pierre.
Lynne DiSanto, Rapid City.
Jason Glodt, Pierre.
Bob Gray, Pierre.
Dan Hargreaves, Stickney
Steve Haugaard, Sioux Falls
Phil Jensen, Rapid City.
Isaac Latterell, Tea.
John Meyer, Winner
Roger Meyer, Yankton
Nancy Neff, Sioux Falls
David Omdahl, Sioux Falls.
Lance Russell, Hot Springs.
John Teupel, Spearfish.
Florence Thompson, Caputa.
Judy Trzynka, Watertown.
Allen Unruh, Sioux Falls.
Mike Vehle, Mitchell.
Dick Werner, Huron.
David Wheeler, Huron
Hal Wick, Sioux Falls.

The Democrats take a split approach, with delegate slates for each of Bernie Sanders and Clinton.

Sanders Delegates

1. Alli Moran D-28
- Eagle Butte

2. Dylan Workman D-12 – Sioux Falls

3. Clara Hart D-6
- Sioux Falls

4. Cully Williams D-2
- Frankfort

5. Margaret Potts D-27
- Porcupine

6. Miller Cannizzaro D-35
- Rapid City

7. Allison Renville D-1 – Sisseton

8. Paul Thronson D-12
- Sioux Falls

9. Rachel Caesar D-34
- Rapid City

10. Tom Katus D-32 – Rapid City

11. Sierra Wolcott D-1
- Sisseston

12. Jim Sanden D-12
- Sioux Falls

13. Monica Hale D-3
- Abeerdeen

14. Paul Schipper D-11 – Sioux Falls

Alternates:

Ellee Spawn D-13 – Sioux Falls

John Stielow D-29 – Sturgis

 

Clinton Delegates

1. Scott Parsley D-8 – Madison

2. Carrie Ackerman Rice D-21 – Lake Andes

3. Shawn Bordeaux D-26 A – Mission

4. Lee Ann Pierce D-7 – Brookings

5. BJ Motley D-25 – Sioux Falls

6. Cecilia Firethunder D-27 – Martin

7. Jeff Wilka D-14 – Sioux Falls

8. Carolyn Ly D-15 – Sioux Falls

9. Marc Feinstein D-14 – Sioux Falls

10. Lorraine Walking Eagle D-26A – St. Francis

11. Zachary Nistler D-10 – Sioux Falls

12. Paula Blake D-24 – Pierre

13. Spencer O’Hara D-13 – Sioux Falls

14. Heather Halverson D -11 – Sioux Falls

Alternates:

Ryan Solberg D-20 – Mitchell

Rachelle Norberg D-21 – Burke

The Democrats also pick six more delegates at their South Dakota convention June 24-25 in Sioux Falls and send five more non-pledged delegates to Philadelphia. The Democrats assign their candidate delegates according to the proportion of the vote won by the candidate in the June 7 primary. The Republicans are winner-take-all.