FEBRUARY 20, 2024:
(SDBA)- Despite its previous defeat, Senate Bill 208 has risen from the legislative graveyard, this time as a measure intended to provide more oversight of the Governor’s Office of Economic Development’s ‘Future Funds.’
The bill initially faced narrow rejection earlier this month. It originated as a measure to cut funding to the Future Fund by a tenth of a percent.
Though SB 208 was defeated in its initial form, lawmakers lamenting over the lack of legislative oversight for Future Funds prompted the bill to be ‘hoghoused,’ and moved for the second time in the Senate Commerce and Energy Committee Tuesday (Feb. 20, 2024).
As it is written now, the legislation would require GOED to furnish quarterly reports for the Joint Committee on Appropriations detailing Future Fund expenditures. In addition to whom the expenditure was given and what the amount was, the amended bill would mandate the disclosure of the purpose of the expenses, the metric used to measure its economic impact, and the number of jobs saved or created, if any.
Criticism of the ‘Future Fund’s’ unfettered use stems from a report by South Dakota Searchlight, which details how Gov. Kristi Noem’s administration has used the funds unconventionally compared to past governor’s administrations – on things like rodeos and the ‘Freedom Works Here’ ad campaign.
Despite initial opposition from entities who have used the funds for decades, like the South Dakota Chamber of Commerce, the amended bill passed through committee without any opposition testimony and only one vote against it.
“This is a good attempt to respond to a concern that is out there,” said Sen. Lee Schoenbeck of Watertown. He made the initial motion to push the bill to the Senate floor.
By Austin Goss, South Dakota Broadcasters Association.
FEBRUARY 9, 2024:
By Austin Goss, South Dakota Broadcasters Association.
(SDBA)– A legislative hearing convened (Feb. 8, 2024) with the intention of discussing cuts to the state’s “Future Fund” quickly evolved into a harsh critique of the current administration’s handling of the fund’s resources.
By one vote, lawmakers defeated a proposal aimed at reducing the fund’s allocation by one-tenth of a percent. The bill, Senate Bill 208 sponsored by Rep. Chris Karr and Sen. Ryan Maher, sought to divert less money to the Employer’s Investment in South Dakota’s Future Fund, established by Gov. Mark Mickelson in 1987 for the purpose of bolstering economic development in the state.
Julie Johnson, the Secretary of Labor when the fund was established in 1987, testified that the intent of the fund was always to have broad application to “economic development” in the state.
“I remember distinctly when we agreed on what the name of the fund should be,” Johnson testified Thursday. “It has been an amazing gift… I am proud of what it has done for South Dakota.”
Following her testimony, numerous business organizations voiced opposition to the proposed reduction, praising the fund’s role in facilitating economic development in the state.
Sen. Ryan Maher, though, was prepared for the opposition testimony. He brought a similar bill in 2017.
“Half the fun of introducing this bill is getting to watch the parade of opponents come forward… Their message is always the same, don’t take our pork away from us,” Maher said. “This doesn’t change any projects from the past.”
Committee members in particular scrutinized Governor Kristi Noem’s administration’s expenditure of the funds, highlighting a $2.5 million dollar allocation for a rodeo in Sioux Falls last year.
Senate President Pro Tempore Lee Schoenbeck was one of several committee members that grilled the Governor’s Office of Economic Development for its oversight of the funds.
“You talk about a shift in legislative power that has been given away, the last figures show $24 million in a fund that the Legislature has no oversight over,” Schoenbeck said. “That is a huge shift in the appropriations authority of the citizens of South Dakota… All that money is being spent on rodeos and s**t that they won’t even post the contracts for.”
Despite vigorous debate, Committee Chair David Wheeler’s deciding vote led to the bill’s postponement, effectively ending its progression. However, both proponents and opponents expressed openness to future discussions regarding oversight of the Future Fund.
Rep. Chris Karr expressed disappointment at the missed opportunity for a tax cut but remained hopeful for future conversations on the matter.
“We missed an opportunity to provide a five million dollar tax cut for businesses and employees that would not have made a significant change in the intent of the Future Funds,” Karr said after the hearing. “This should have been a slam dunk issue.”
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