South Dakota Voices Comment: Kathy, thank you for the great questions. There are people in the legislature that know there is an oversight issue and have been trying to correct the problem. They tried in 2024 and again in 2025. Also, there are many people who are asking questions about why we have the tax.
Email comment from KH: "How do they figure this money from the businesses is helping our state as this is really costing the tax payers twice or an i not understanding it right???and how are the monies decided to be distributed, who all is a part of this process, just the governor??? Not legislature??"
“The moneys are completely controlled by the Governor, without any citizen or legislative oversight.”
Anything of this sort, using tax payer dollars (regardless of how collected), screams waste, fraud, and abuse. Anytime taxpayer dollars are involved, there should be a system of checks and balances. This needs to end. Taxation of this sort is theft.
Perhaps it should be treated like an emergency/rainy day fund and subject to the legislature with governor's approval like regular appropriations. We need to press our state legislators to take it away from the governor's sole discretion, and it needs some kind of controls so that it's not easy to access, a two thirds majority?
I think it's OK as long as the fund can apply to the full budget when there's a real need (meaning that it can include benefiting the people directly or keeping their direct taxes low).
This fund is absolutely absurd. It’s a slush fund and there’s not no other way to describe it. In my business, we pay thousands of dollars every year to that unemployment fund when we have not had a single claim In over a decade. Why should one person without oversight, be able to spend millions of dollars of taxpayer funds on pet projects for their friends. Our economy today, also is well enough diverse clearly with the I29 corridor growth that the intention of this fund is not needed anymore. If the legislature wanted to save up some 50 million in a reserve account for a rough year like Covid, from the general fund, I would support that fully. But not for politicians to toss it around wherever they’d like. We could have used some of that money in Brown County for a newer, larger, regional jail, far more than real estate developers in Sioux Falls need it.
Interesting about the jail. We are hearing rumblings that the whole corrections system may be smoke and mirrors and that a lot of the people in our facilities may be from out of state (people are suggesting this is a major issue because Kellie Wasko is refusing to disclose the numbers). What are you hearing in Brown County?
I’m not involved so much to know what the state is up to, but in Brown County are space is tight even after expansions made in the last 10 years. We wanted to take an empty commercial building and convert it into a regional jail but we did not have the funding. Other counties, I would have used it for their prisoners would not chalk up any dough and the state legislators balked at it. Perhaps that they could’ve given us 2-5 million like they did to promote tourism or to private contractors in SF we could have helped this whole corner of the state with jail space.
There is a place for an economic development function in state government, but what it should it do and how should it operate has to be subject to some checks and balances and much greater transparency and public input. You can go through state statutes for many departments and agencies in state government and find some language that makes economic development a part of their mission. I have a problem with this when the agency is a regulator of the same enterprises that it is tasked to promote. It is a horrible conflict of interest.
Governors Janklow and Mickelson added to the problem by centralizing the economic development functions of state government. Janklow was a control freak, a one-man economic development department. What he thought was economic development was supposed to happen, no matter what. So, we got Citibank, but we also almost got a nuclear waste dump and bad water projects. We did get the Twin Cities sewage ash, but not the sewage ash to gold magic machine. Out of that came extremely bad publicity in the Wall Street Journal.
Whiile Janklow used bluff and subterfuge Mickelson developed the Future Fund, a kinder, gentler way to weigh in on pet projects. I don't have a problem with the workforce development aspect of the Fund, but some funding decisions are flat out distributions to favored industries, pet projects, favored lobbying groups or favored political donors.
The whole economic development infrastructure of state government needs reform. It has needed it since the late 1980s.
Thank you for this well-presented piece. There’s so much “tax-web” spinning to create billion dollar boondoggles, but this article lays it out well to the reader. What can be done? Shooting range seems to be prime example. The Holders of the Checkbook (SD House Legislators) said no. Thumbing nose, it happened anyway. I’m smelling the same with the prison we were told “was going to happen”.
This definitely needs to be taken away from the governorship! No one person should have that kind of power over that amount of money! Kristi showed us what abuse of it looks like!
I don’t like the idea of a slush fund for a governor to do whatever they want. It gives them money to reward their big donors with projects that voters may not want (like the shooting range). There needs to be some sort of oversight
I'm not sure why you wouldn't want economic development even with full employment. People in South Dakota generally are employed at jobs they are overqualified for. If you can grow certain industries in the state that provide jobs at a level with their qualifications you will generally have higher paid workers who will then buy more goods and services from others, providing an economic benefit to everyone.
When you have massive development, without the workers to support it, all you get is corporations coming in with free land to build on then they bring in foreign workers, and build products that we don’t use. They are just using our infrastructure and welfare programs for their profit. Government sponsored Development should only help The taxpayers that are funding it. They bring workers that Do not have the hard-working values that we do.
Well, sure, you have to plan economic development to match your workforce, but you also have to consider that this ain't the 1950s, where people lived in one neighborhood their whole lives and no "foreigners" lived here. In fact I wonder with that attitude how South Dakota even got settled. State boundaries mean nothing. Capital and labor move. They'll move in. Or they'll move out. South Dakota's children move the hell out. As long as you're stuck in the 1950s, they'll keep on moving away.
Perhaps I am missing something. I know plenty of people with very good educational backgrounds that are here in South Dakota (degrees from Harvard, Stanford, etc., if that is the criteria you are suggesting). I know one 25 year old who left a big tech state and city (fancy brand name education) and moved to South Dakota for opportunity. Are you suggesting the only good jobs are from big multi-national corporations that take taxpayer handouts? Many people are here because of opportunity and it isn’t Microsoft or Apple. In fact, most I have met left places with those companies because they have no desire to be in a place with that type of corporate welfare and the social problems it creates. Could part of the problem be that we think that there is only one type of good job? If so, what exactly is that?
Sure, but the number and variety of such jobs is much higher in other places. There are also a lot more start-ups, and sources of funding for such companies in other places. There is no place that is more into corporate welfare than South Dakota.
Sadly, economic development at full employment pushes people into poverty. Most people believe this is bad for the people who are pushing into poverty and for society in general. How do you feel about pushing people into poverty (the mechanism is described in several other posts)?
Badly planned economic development, at full employment or below it, can push people into poverty. If you plan economic development to match the needs of the workforce, and not the needs of the few businesses at the top, you can provide a boost for all strata of society.
In South Dakota, people often have to go out of state to find jobs that can take advantage of their qualifications. South Dakota exports a lot of highly qualified people. Taxpayers pay to educate them, and then they leave to take jobs in other states, rather than fill a position that could go to someone else with less skills. If that person decides to take an in-state job at a lower level of skill than they are qualified for, rather than the job out of state, it shortchanges the overqualified person, and it takes a job from someone who could lift themselves out of poverty by taking a job they are suited for. Skill mismatch is a much greater generator of poverty than more jobs at full employment.
South Dakota Voices Comment: Kathy, thank you for the great questions. There are people in the legislature that know there is an oversight issue and have been trying to correct the problem. They tried in 2024 and again in 2025. Also, there are many people who are asking questions about why we have the tax.
Email comment from KH: "How do they figure this money from the businesses is helping our state as this is really costing the tax payers twice or an i not understanding it right???and how are the monies decided to be distributed, who all is a part of this process, just the governor??? Not legislature??"
This looks like it was used as Noem’s personal piggy bank to drop patronage on compliant legislators
“The moneys are completely controlled by the Governor, without any citizen or legislative oversight.”
Anything of this sort, using tax payer dollars (regardless of how collected), screams waste, fraud, and abuse. Anytime taxpayer dollars are involved, there should be a system of checks and balances. This needs to end. Taxation of this sort is theft.
Wonder why these Chambers of "commerce" (lol) need so much welfare assistance? Doesn't sound very American.
Interesting term. Welfare is a handout without doing production, so I guess that would be an appropriate term.
Perhaps it should be treated like an emergency/rainy day fund and subject to the legislature with governor's approval like regular appropriations. We need to press our state legislators to take it away from the governor's sole discretion, and it needs some kind of controls so that it's not easy to access, a two thirds majority?
Interesting suggestion. How do you feel about the employer being taxed and then passing that cost on to the citizens (indirectly taxing the citizens)?
I think it's OK as long as the fund can apply to the full budget when there's a real need (meaning that it can include benefiting the people directly or keeping their direct taxes low).
This fund is absolutely absurd. It’s a slush fund and there’s not no other way to describe it. In my business, we pay thousands of dollars every year to that unemployment fund when we have not had a single claim In over a decade. Why should one person without oversight, be able to spend millions of dollars of taxpayer funds on pet projects for their friends. Our economy today, also is well enough diverse clearly with the I29 corridor growth that the intention of this fund is not needed anymore. If the legislature wanted to save up some 50 million in a reserve account for a rough year like Covid, from the general fund, I would support that fully. But not for politicians to toss it around wherever they’d like. We could have used some of that money in Brown County for a newer, larger, regional jail, far more than real estate developers in Sioux Falls need it.
Interesting about the jail. We are hearing rumblings that the whole corrections system may be smoke and mirrors and that a lot of the people in our facilities may be from out of state (people are suggesting this is a major issue because Kellie Wasko is refusing to disclose the numbers). What are you hearing in Brown County?
I’m not involved so much to know what the state is up to, but in Brown County are space is tight even after expansions made in the last 10 years. We wanted to take an empty commercial building and convert it into a regional jail but we did not have the funding. Other counties, I would have used it for their prisoners would not chalk up any dough and the state legislators balked at it. Perhaps that they could’ve given us 2-5 million like they did to promote tourism or to private contractors in SF we could have helped this whole corner of the state with jail space.
Do you have any out of state prisoners?
I’m not exactly sure. I’m not privy to that information.
There is a place for an economic development function in state government, but what it should it do and how should it operate has to be subject to some checks and balances and much greater transparency and public input. You can go through state statutes for many departments and agencies in state government and find some language that makes economic development a part of their mission. I have a problem with this when the agency is a regulator of the same enterprises that it is tasked to promote. It is a horrible conflict of interest.
Governors Janklow and Mickelson added to the problem by centralizing the economic development functions of state government. Janklow was a control freak, a one-man economic development department. What he thought was economic development was supposed to happen, no matter what. So, we got Citibank, but we also almost got a nuclear waste dump and bad water projects. We did get the Twin Cities sewage ash, but not the sewage ash to gold magic machine. Out of that came extremely bad publicity in the Wall Street Journal.
Whiile Janklow used bluff and subterfuge Mickelson developed the Future Fund, a kinder, gentler way to weigh in on pet projects. I don't have a problem with the workforce development aspect of the Fund, but some funding decisions are flat out distributions to favored industries, pet projects, favored lobbying groups or favored political donors.
The whole economic development infrastructure of state government needs reform. It has needed it since the late 1980s.
Thank you for bringing up the issue of conflict of interest.
Taxes are illegal. Full Stop!
Thank you for this well-presented piece. There’s so much “tax-web” spinning to create billion dollar boondoggles, but this article lays it out well to the reader. What can be done? Shooting range seems to be prime example. The Holders of the Checkbook (SD House Legislators) said no. Thumbing nose, it happened anyway. I’m smelling the same with the prison we were told “was going to happen”.
This definitely needs to be taken away from the governorship! No one person should have that kind of power over that amount of money! Kristi showed us what abuse of it looks like!
I don’t like the idea of a slush fund for a governor to do whatever they want. It gives them money to reward their big donors with projects that voters may not want (like the shooting range). There needs to be some sort of oversight
I'm not sure why you wouldn't want economic development even with full employment. People in South Dakota generally are employed at jobs they are overqualified for. If you can grow certain industries in the state that provide jobs at a level with their qualifications you will generally have higher paid workers who will then buy more goods and services from others, providing an economic benefit to everyone.
When you have massive development, without the workers to support it, all you get is corporations coming in with free land to build on then they bring in foreign workers, and build products that we don’t use. They are just using our infrastructure and welfare programs for their profit. Government sponsored Development should only help The taxpayers that are funding it. They bring workers that Do not have the hard-working values that we do.
Well, sure, you have to plan economic development to match your workforce, but you also have to consider that this ain't the 1950s, where people lived in one neighborhood their whole lives and no "foreigners" lived here. In fact I wonder with that attitude how South Dakota even got settled. State boundaries mean nothing. Capital and labor move. They'll move in. Or they'll move out. South Dakota's children move the hell out. As long as you're stuck in the 1950s, they'll keep on moving away.
Perhaps I am missing something. I know plenty of people with very good educational backgrounds that are here in South Dakota (degrees from Harvard, Stanford, etc., if that is the criteria you are suggesting). I know one 25 year old who left a big tech state and city (fancy brand name education) and moved to South Dakota for opportunity. Are you suggesting the only good jobs are from big multi-national corporations that take taxpayer handouts? Many people are here because of opportunity and it isn’t Microsoft or Apple. In fact, most I have met left places with those companies because they have no desire to be in a place with that type of corporate welfare and the social problems it creates. Could part of the problem be that we think that there is only one type of good job? If so, what exactly is that?
Sure, but the number and variety of such jobs is much higher in other places. There are also a lot more start-ups, and sources of funding for such companies in other places. There is no place that is more into corporate welfare than South Dakota.
Sadly, economic development at full employment pushes people into poverty. Most people believe this is bad for the people who are pushing into poverty and for society in general. How do you feel about pushing people into poverty (the mechanism is described in several other posts)?
Badly planned economic development, at full employment or below it, can push people into poverty. If you plan economic development to match the needs of the workforce, and not the needs of the few businesses at the top, you can provide a boost for all strata of society.
In South Dakota, people often have to go out of state to find jobs that can take advantage of their qualifications. South Dakota exports a lot of highly qualified people. Taxpayers pay to educate them, and then they leave to take jobs in other states, rather than fill a position that could go to someone else with less skills. If that person decides to take an in-state job at a lower level of skill than they are qualified for, rather than the job out of state, it shortchanges the overqualified person, and it takes a job from someone who could lift themselves out of poverty by taking a job they are suited for. Skill mismatch is a much greater generator of poverty than more jobs at full employment.