I yield the floor to Zach Crago, who yields the executive directorship of the South Dakota Democratic Party to the next willing and able madman.

Crago is leaving South Dakota for graduate school... but not without offering a valuable review of the work he thinks the SDDP has done during his watch. Here's Crago's exit report, plus a real trooper's exhortation to action.

Zach Crago, SDDP executive director until January 1

Zach Crago, SDDP executive director until January 1

Dear South Dakota Democrats,

As I’ve long planned, I’m resigning as Executive Director of the South Dakota Democratic Party at the end of this calendar year with good news to share about the state of the State Party that you all deserve to hear.

But let’s get right to the point on everyone’s mind - the 2014 elections were painful for Democrats. Nationally, Republicans padded their majority in the US House of Representatives, and the GOP swept nearly every single competitive Senate race to capture the US Senate majority. It wasn’t much better here in South Dakota either. We lost Senator Tim Johnson’s US Senate seat and all other statewide races. And while we gained one seat in the State Senate, we lost five seats in the State House.

Some are saying the South Dakota Democratic Party is broken, but fact of the matter is nothing could be further from the truth. While the Party exists to win elections, we must also be good stewards who protect our Party’s viability beyond any single election cycle. Despite a dismal election here and across the country, the South Dakota Democratic Party has made enormous progress this election cycle in fundraising, field organizing, and our future leadership to build a party that lasts.

The South Dakota Democratic Party has a mixed past when it comes to raising money. We’ve raked in cash with powerful federal office holders & strong state party leaders and held literally hundreds of thousands of dollars in debt after elections gone bad. The boom and bust cycle made it impossible to retain top quality staff, attract new talent, or inspire confidence in prospective candidates and volunteers.

Chair Deb Knecht and I decided we were going to escape the broken boom and bust cycle when we took charge in July of 2013. At that time, the South Dakota Democratic Party was raising $1963 a month from the Founders Club, the monthly sustaining donor program George McGovern started in the 1950s - barely enough to cover rent, phones, and office supplies every month. Today with the support of over 160 Democrats, the South Dakota Democratic Party raises $6360 a monthfrom Founders Club members like you. With the DNC’s additional $5,000 a month State Partnership Program contribution, our ongoing revenue matches our ongoing expenses nearly dollar for dollar for three full time staff.

And guess what? When the ongoing expenses are covered by ongoing revenue, it’s a lot easier to raise one-time money for targeted programs too. In fact, the South Dakota Democratic Party raised $458,959 in one time contributions this year from revamped events like our “Tribute to Tim” McGovern Day Dinner with over 725 people and over a dozen house parties, a new monthly mail program, an aggressive email operation, and regular call time from our state party chair and staff among other successful fundraising initiatives.

When you’re raising that kind of money, you can spend it on field organizing that makes a difference. The South Dakota Democratic Party wasted no time in 2013 when we partnered with our friends in organized labor to sponsor an initiated measure to raise the minimum wage. In 60 short days, we hired 1 Field Director and 10 organizers, recruited over 500 petition circulators, and submitted 25,681 signatures from registered voters to put our initiated measure on the ballot. With $330,000 supporting the IM 18 campaign, 55% of South Dakota voters said Yes on 18, giving 62,000 South Dakotans a raise. In an otherwise rough election, YOU can be proud that the South Dakota Democratic Party championed this issue for working families across the state.

We made big investments in the field to help candidates win up and down the ballot too. The South Dakota Democratic Party hosted 7 webinars and 41 one on ones to train our candidates. We rewarded candidates who knocked doors and raised money with 32 rounds of free mail. We created the first ever YELL Fellows program with 21 young Democrats who were paid staff paired with 21 legislative candidates with half the expense covered by the Majority Project and half by the candidates. We hammered away at the Mike Rounds EB5 citizenship-for-sale scheme through 12 press conferences that among other things generated over 12,500 articles on Mike Rounds and the EB5 scandal. With the additional scrutiny, Mike Rounds dropped to a 4 point lead in the polls in early October.

We also made big five figure investments in our Get Out The Vote program. With Democratic County Party GOTV offices across the state, volunteers like you made approximately 31,000 calls. Our GOTV headquarters in Sioux Falls incorporated predictive dialers and canvasses to make 313,764 calls. Add to that a special targeted effort to reach Democrats with a low to mid likelihood of voting, and the South Dakota Democratic Party made over 573,000 phone calls across the state! Strong candidates with proper trainings and a focus on turnout allowed us to gain a seat in the State Senate - one of only 14 legislative chambers in the entire country in which Democrats gained seats.

At the same time we were ramping up our fundraising for big investments in field organizing, we were thinking about the future too. The question I heard most often as Legislative Director and then Executive Director is how do we get more young people involved in the Party? We tried answering that question. In 2013, the South Dakota Democratic Party started the first ever Young Elected Legislative Leaders retreat in Pierre for high school Democrats who draft bills, debate legislators, and decide issues on the state senate floor. 28 students participated in 2013, and the program was so successful among students 48 high schoolers participated in 2014. Know what they told us in a survey afterwards? They didn’t want to stop after the weekend. They wanted to find more ways to make a difference right now. So we answered their call too, and we formed the aforementioned YELL Fellows program where our 21 YELL Fellows knocked thousands of doorsand made thousands of phone calls for legislative candidates. And after the election was all said and done, we left $60,000 in the bank to continue building a better future right away.

To be sure, our efforts didn’t translate to the ballot box this year. But just because we didn’t see electoral gains from our efforts in a tough year doesn’t mean we stop raising money, recruiting volunteers, or bringing more young people into the Party for the next election cycle. It means we need to continue this work - and do more! We have to evaluate our efforts, adapt, and iterate - and once the statewide voterfile is released by the Secretary of State, the Party plans to model results against our targeted programs to see if our investments made an impact. Most importantly, we need to continue to add more value for the Party. We need to raise more money, rebuild county parties, recruit more candidates, and register more voters to win elections going forward.

Here’s the tough part: We can’t do this without you. Do you want a staff person dedicated to Democratic turnout? Be a Founders Club member with a monthly contribution of any amount that fits your budget. There’s no reason why the South Dakota Democratic Party can’t double our Founders Club program and with it double our number of full time staff for Democratic turnout, candidate recruitment, voter outreach, or rapid response communications.

Do you want to help build our county parties? Be a county party officer in your county. You can be appointed in vacant counties, or you can run for a filled county party office in April. The South Dakota Democratic Party is about to embark on an aggressive training program for county officers across the state so you have the tools to raise money, recruit local candidates and register voters in your county.

Do you want to bring more young people into the Party? Invest in the rapidly growing Young Elected Legislative Leaders program, where we are already training the next generation of South Dakota’s Democratic leaders.

Do you want to help in other ways? Let us know how you want to keep building the South Dakota Democratic Party.

Yes, I’m resigning my role as Executive Director, but the truth is I didn’t do this work alone. Not even close. State party leaders before me paid off all our remaining debt. Chair Deb Knecht called Democrats across the state to triple our Founders Club program. Volunteers like you gave your time to put minimum wage on the ballot. Donors like you funded a host of projects including the Young Elected Legislative Leaders program. County party officers like you guided us through thick and thin. And our unparalleled Field Director Ryan Rolfs & Finance Director Zach Nistler worked way too many hours for way too little pay to put the pieces of the puzzle together.

With the continued support of Democrats like you, truthseekers like Cory Heidelberger here at MadvilleTimes.com, and great new leaders like State Party Chair-elect Ann Tornberg and Vice Chair-elect Joe Lowe, the South Dakota Democratic Party’s best days are ahead. Thank you for giving me the opportunity to work with you over the last four years. I look forward to volunteering my time, talent, and treasure right beside you going forward.
Zach Crago, Executive Director, South Dakota Democratic Party
[letter, 2014.12.19]

We didn't win elections, but we did a lot of things that will help us win future elections. All applicants for Crago's job (submit résumés to SDDP!) should read this letter and come to the interview with a critique of this assessment and an action plan for capitalizing on Crago's work.

Crago will continue to advise the party part-time after January 1 to help pass his knowledge on to the next exec. Good luck with the transition, Zach, and with the next big adventure!

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Time to set up some protest camps in East River! The Public Utilities Commission has received the formal application from Houston-based Dakota Access to build a Bakken oil pipeline across eastern South Dakota. To kick off the permitting process, the PUC will hit the road, hosting four public meetings January 21 and 22 to give Dakota Access officials a chance to explain their project and take questions from those of us who will host their environmental hazard:

  • Bowdle, school gym, Wednesday, January 21, noon to 3 p.m.
  • Redfield, school auditorium, January 21, 6 p.m. to 9 p.m.
  • Iroquois, school gym, Thursday, January 22, 10:30 a.m. to 1:30 p.m.
  • Sioux Falls, Ramkota Roosevelt Room, January 22, 5:30 p.m. to 8:30 p.m.

Bob Mercer reports that South Dakotans unpersuaded by the company's pitch will have until February 513 to file with the PUC as official intervenors in the hearing. The PUC will set a date for the evidentiary hearing and rule on the pipeline application by December 14, 2015.*

Correction 14:41 CST: The original post got the intervenor filing and final decision dates wrong. I have corrected those dates and apologize for messing them up in the first place!

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My eager readers have numerous questions about the new Build Dakota Scholarship, the $50-million joint venture between the state and usury-baron-cum-philanthropist T. Denny Sanford to offer 300 full-ride scholarships to get vo-tech students to stay and work in South Dakota. Who's eligible? For how much? In which job fields? And can the state hammer out the details in time for high school seniors to apply this spring?

The state is trying to answer those questions. The South Dakota Department of Education sent me the following FAQ sheet yesterday afternoon:

  1. WHAT IS THE BUILD DAKOTA SCHOLARSHIP PROGRAM?
    A new scholarship program created through a $50 million dollar investment funded by a $25 million donation from T. Denny Sanford and a $25 million contribution from the South Dakota Future Fund.
  2. WHAT PROGRAMS OF STUDY QUALIFY FOR THE SCHOLARSHIP?
    The scholarship administration board will determine the eligible technical institute programs each year. For the 2015-16, information will be released with the scholarship application in February 2015.
  3. WHAT COSTS ARE COVERED BY THE SCHOLARSHIP?
    The scholarships will support tuition, fees, books and other required program expenses in the eligible, South Dakota technical institute programs.
  4. IS THERE A CAP ON THE AMOUNT OF THE SCHOLARSHIP AWARD?
    The scholarship covers tuition, fees and other required program expenses for Build Dakota scholars. For the 2014-15 school year, full-time students make the following investments for a technical institute education:

    • AAS Programs: Full program expenses range from approximately $16,000 to $19,750 (median $17,875) over the 2-year program. Included in the estimated expenses are tuition and fees, technology, tools and books required to complete the program.
    • Diploma Programs: Full program expenses range from approximately $9,000 to $12,000 (median $10,500) for the 1-year program.
  5. CAN OUT-OF-STATE STUDENTS APPLY?
    Yes, they can. Both South Dakota students and out-of-state students are eligible for the scholarships.
  6. WHO IS ELIGIBLE FOR THE SCHOLARSHIP?
    The Build Dakota Scholarship program will begin with newly enrolled students in Fall 2015.
  7. WHAT IS THE FUTURE FUND?
    The state’s investment in Build Dakota comes from the Future Fund. Following the recession of the early 1980s, the Future Fund was developed by Governor Mickelson to invest in South Dakota’s workforce and build its economy. The Future Fund supports the workforce development and technical assistance programs which help train employees, retrain employees during layoffs and support business recruitment, economic development initiatives, and research and entrepreneurial activities.
  8. WHAT HAPPENS TO THE CRITICAL NEEDS WORKFORCE SCHOLARSHIP?
    The Critical Needs Workforce Scholarship will be phased out as funds are allocated to the Build Dakota scholarship program [South Dakota Department of Education, FAQ sheet, e-mailed to Madville Times, 2014.12.18].

Item 4 confounds my calculations on the scholarship/purchasing-power payoffs. I based my calculations on the high end of a KELO report pegging vo-tech costs at $12K to $15K. DOE is saying the Build Dakota Scholarships could pay $9K to $12K for one-year programs and $16K to nearly $20K for two-year programs. Plus, a friend in government suggests revising my calculations to regional price parity data, which this friend contends are more accurate than my long-preferred C2ER cost-of-living data. Looks like a weekend of more spreadsheets....

Item 2 says the details on eligible programs will be hammered out by February, when the state will release the scholarship application form. Item 8 may provide a clue as to which job fields Build Dakota will target. The current Critical Needs Workforce Scholarship puts a measly $500K toward vo-tech scholarships of up to $5K. Build Dakota will replace that program with scholarships worth, in the case of two-year programs, up to four times that amount. The Critical Needs Workforce Scholarship currently targets these degrees and job fields:

LAKE AREA TECHNICAL INSTITUTE MITCHELL TECHNICAL INSTITUTE
• Energy Operations – AAS
• Energy Technology – AAS
• Precision Machining – AAS
• Precision Machining eDegree – AAS
• Robotics eDegree – AAS
• Architectural Design & Building Construction – AAS
• Automation Controls/SCADA – AAS
• Electrical Utilities and Substation Technology – AAS
• Electrical Construction & Maintenance – AAS/Diploma
• Farm Power Technology – AAS
• Heating & Cooling Technology – AAS/Diploma
• Industrial Controls – Certificate
• Industrial Maintenance Technology – Diploma
• Information Systems Technology – AAS/Diploma
• Precision Technology Specialist – AAS/Diploma
• Telecommunications – AAS
• Welding & Manufacturing Technology – AAS/Diploma
SOUTHEAST TECHNICAL INSTITUTE WESTERN DAKOTA TECH
• Automotive Technician – AAS/Diploma
• CIS/Systems Administration – AAS
• Civil Engineering Technology – AAS
• Computer Network Security – AAS
• Computer Programming – AAS
• Computer Science – AAS/Diploma
• Diesel Technology – AAS/Diploma
• Electronics Technology – AAS/Diploma
• Land Surveying Science Technology – AAS
• Mechanical Engineering Technology – AAS
• Mechatronics – AAS
• Plumbing – Diploma
• Welding – Diploma
• Computer Aided Drafting – AAS/Diploma
• Computer Science – AAS/Diploma
• Electrical Trades – AAS
• HVAC Technology – Diploma
• HVAC/R Technology – AAS
• Network Administration & Security – AAS/Diploma
• Precision Machining – AAS/Diploma
• Transportation Technology – AAS
• Welding – AAS/Diploma

Expect Build Dakota to target a very similar list of degrees and jobs.

DOE's original Build Dakota info sheet offers eligibility criteria, and financial need is included:

  • Interest in the high-need workforce areas
  • U.S. citizen or U.S. national
  • Applicants need not be South Dakota residents
  • Financial need
  • Demonstrated aptitude through one or more of the following:
    • The National Career Readiness Certificate (NCRC) or other industry-recognized certifications in the career area
    • Technical, dual or concurrent credit courses taken in the career interest area
    • Career & Technical Education coursework completed in the career interest area
    • Work-based learning experiences, internships or work experience in the career interest area [Department of Education, Build Dakota Scholarship information sheet, downloaded 2014.12.18]

Low-income students may get some preference, but I wonder how high we will or should prioritize financial need? If this is a workforce-building plan, should we choose recipients based on talent first, then break ties on financial need? Or is this an opportunity to build skills among low-income students who may not otherwise have the chance to get a good technical education?

Again, this is all a work in progress. The Legislature will likely want to get its hand on the tiller, too... although with the money all coming from Sanford's private fortune and the Governor's own Future Fund, is any Legislative action needed? Whoever gets involved, watch for the final details by February.

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Oh, fuss and feathers! We got all hot and bothered here on the blog about the Rapid City Police Department's denial of a permit to American Indian activists who want to stage a protest against police brutality during the Lakota Nation Invitational. But Rapid City Police Chief Karl Jegeris was serious when he said he was working with organizers to accommodate their First Amendment rights. The protest is on for this afternoon!

Rapid City Police Chief Karl Jegeris has authorized a special event permit for this march and rally from 1 to 3 p.m., Friday, Dec. 19, in Memorial Park, Legacy Commons and the Promenade.

“I am thankful that we came to an agreement to address the public safety concerns,” Jegeris said.

The Rapid City Police Department will be present during the event to ensure the public safety of all residents and visitors ["Rapid City Police Chief Approves Protest Rally for Friday," KOTA-TV, 2014.12.18].

Kevin Woster explains that a big part of Chief Jegeris's initial rejection of the permit was timing:

Protesters had wanted to have the protest rally and March from 3 p.m. to 5 p.m. Friday. They would have marched from the east parking lot of the civic center south a few blocks to Main Street, then west on Main for three blocks to Mount Rushmore. From there they were to march back to the west parking lot of the civic center.

Those are some of the busiest streets in Rapid City, especially when there’s an event at the civic center and Rapid City Central – just across the street – is releasing students for the day.

Add in approaching darkness and the protest plan was an unacceptable danger to LNI attendee, Central students, the general public and protesters and the police, Jegeris said.

“The time frame would be just about dark and getting dark,” he said. “And there’s just so many safety considerations that I just have to put safety first” [Kevin Woster, "RC Chief Approves Permit After Initial Rejection," KELOLand.com, 2014.12.18].

See? Chief Jegeris is no brute; he's actually helping the protesters shine more daylight on their message.

So Larry, still want to move LNI out of Rapid City?

44 comments

The Build Dakota Scholarship program created by Governor Dennis Daugaard and billionaire T. Denny Sanford promises 300 vo-tech students a year a free two-year education in return for three years of work in South Dakota.

KELO says vo-tech programs in South Dakota run between $12,000 and $15,000. The top end of that range puts the up-front dollar value of the Build Dakota scholarship on par with the Critical Teaching Needs Scholarship, created in 2013, which pays the last two years of tuition and fees for willing teacher candidates. However, the vo-tech students are getting a better deal: the teachers must promise to work in South Dakota for five years.

As we know, students accepting the Critical Needs Teaching Scholarship are trading $15K in tuition costs for $65K in sacrificed purchasing power available for working outside of South Dakota. Will Build Dakota Scholarship takers come out any better financially?

That math is uncertain: Governor Dennis Daugaard has not announced yet which job fields he will target with the new scholarship, so we don't know which wage data to compare. But let's take some guesses.

We'll focus on wages in South Dakota and the six adjoining states. Let's look first at median wages, the halfway point for wages in various fields. Here are the median wages for all occupations:

All Occupations
State Annual Median Salary Per-capita state taxation Salary in pocket after state tax Cost of living (2014 Q3) Adjusted post-tax salary power Additional purchasing power from working here instead of SD
IA $32,380 $3,740 $28,640 92.8 $30,862 $4,884
MN $37,390 $4,858 $32,532 101.2 $32,146 $6,168
MT $30,770 $3,137 $27,633 102.1 $27,065 $1,086
ND $35,640 $4,057 $31,583 101.7 $31,055 $5,077
NE $31,840 $3,991 $27,849 97.7 $28,505 $2,526
SD $29,420 $3,052 $26,368 101.5 $25,978 $0
WY $36,990 $3,500 $33,490 94.4 $35,477 $9,498

South Dakota has the lowest median wage in the region. We have the lowest state and local tax burden, but our cost of living (by the most recent available data, 2014 Q3) is higher than the national average and even three ticks higher than Minnesota's. Our median adjusted post-tax purchasing power is four digits less than our neighbors'—4% less than Montana's, 24% less than Minnesota's, and 37% less than Wyoming's.

But hold on: that's all jobs, from bailiff and dishwasher up to nurse anaesthetist and CEO. Our vo-tech grads are aiming for a specific subset of jobs.

Let's look at the general category BLS calls "Production Occupations," where we should find a higher proportion of vo-tech grads:

Production Occupations
State Annual Median Salary Per-capita state taxation Salary in pocket after state tax Cost of living (2014 Q3) Adjusted post-tax salary power Additional purchasing power from working here instead of SD
IA $31,550 $3,740 $27,810 92.8 $29,968 $4,186
MN $33,730 $4,858 $28,872 101.2 $28,530 $2,748
MT $30,970 $3,137 $27,833 102.1 $27,261 $1,479
ND $33,830 $4,057 $29,773 101.7 $29,275 $3,494
NE $30,230 $3,991 $26,239 97.7 $26,857 $1,075
SD $29,220 $3,052 $26,168 101.5 $25,781 $0
WY $44,270 $3,500 $40,770 94.4 $43,189 $17,407

Oops! Median pay is actually a little worse in this field, except in Wyoming, where median pay and post-tax adjusted purchasing power jumps to a $17K advantage over South Dakota'

Let's get specific. Within "Production Occupations," our governor talks a lot about welders:

Welders, Cutters, Solderers, and Brazers
State Annual Median Salary Per-capita state taxation Salary in pocket after state tax Cost of living (2014 Q3) Adjusted post-tax salary power Additional purchasing power from working here instead of SD
IA $34,570 $3,740 $30,830 92.8 $33,222 $4,820
MN $38,760 $4,858 $33,902 101.2 $33,500 $5,098
MT $33,750 $3,137 $30,613 102.1 $29,983 $1,581
ND $43,010 $4,057 $38,953 101.7 $38,302 $9,900
NE $34,340 $3,991 $30,349 97.7 $31,063 $2,661
SD $31,880 $3,052 $28,828 101.5 $28,402 $0
WY $46,120 $3,500 $42,620 94.4 $45,148 $16,746
Welding, Soldering, and Brazing Machine Setters, Operators, and Tenders
State Annual Median Salary Per-capita state taxation Salary in pocket after state tax Cost of living (2014 Q3) Adjusted post-tax salary power Additional purchasing power from working here instead of SD
IA $36,890 $3,740 $33,150 92.8 $35,722 $4,729
MN $36,000 $4,858 $31,142 101.2 $30,773 -$220
MT $36,140 $3,137 $33,003 102.1 $32,324 $1,331
ND $37,760 $4,057 $33,703 101.7 $33,140 $2,147
NE $37,960 $3,991 $33,969 97.7 $34,769 $3,776
SD $34,510 $3,052 $31,458 101.5 $30,993 $0
WY $50,360 $3,500 $46,860 94.4 $49,640 $18,647

In these two job areas, the only place South Dakota beats on post-tax purchasing power is Minnesota, for welding, soldering, and brazing machine setters, operators, and tenders, and there our advantage is just $220, about 0.7%, or the cost of gas and a motel room to go see the Vikings play. Welders, cutters, solderers, and brazers come out over $5K better a year in Minnesota than in South Dakota.

But hold on again: these figures are median figures, the 50th-percential salary. Half the welders make more, half make less. We're trying to calculate the outlook for fresh-faced vo-tech grads. Welders probably need to work a while before they can prove they deserve more pay than half of their colleagues. We should thus look at salaries in the lower end of each field.

The Bureau of Labor Statistics has data on the certain percentile salaries in each occupation and each state (and you think your daily math is hard?). So let's try this: assume a new vo-tech grad jumps into a new job and, for a starting wage, gets the 10th-percentile salary (10% of workers make less, 90% make more). This kid's from South Dakota, and she would have qualified for a Build Dakota free-ride, so she's smart and good at her job. Second year, the boss raises her pay to the 25th-percentile. Third year, she gets another raise, to the median salary. On that pay trajectory, how do things look for our prospective welders?

Welders, Cutters, Solderers, and Brazers
State Annual 10th-percentile salary Annual 25th-percentile salary Annual 50th-percentile (median) salary Sum
IA $25,670 $29,460 $34,570 $89,700
MN $26,970 $32,410 $38,760 $98,140
MT $23,350 $27,510 $33,750 $84,610
ND $30,820 $35,240 $43,010 $109,070
NE $25,110 $28,870 $34,340 $88,320
SD $25,290 $27,750 $31,880 $84,920
WY $30,720 $37,530 $46,120 $114,370
Welding, Soldering, and Brazing Machine Setters, Operators, and Tenders
State Annual 10th-percentile salary Annual 25th-percentile salary Annual 50th-percentile (median) salary Sum
IA $27,400 $32,370 $36,890 $96,660
MN $25,290 $29,260 $36,000 $90,550
MT $24,790 $31,460 $36,140 $92,390
ND $26,830 $31,910 $37,760 $96,500
NE $24,050 $31,280 $37,960 $93,290
SD $27,220 $31,240 $34,510 $92,970
WY $33,990 $41,400 $50,360 $125,750

With that fourth column, adding a year at the 10th percentile, a year at the 25th, and a year at the 50th (the median), we're getting closer to the real picture our vo-tech prospects face as they try to figure out whether taking the Build Dakota Scholarship is worth committing to work in South Dakota for three years. Let's plug those three-year income sums into our spreadsheet, subtract three years' tax burden, factor in cost of living, and see what happens:

Welders, Cutters, Solderers, and Brazers
State 3-yr income 10th-25th-50th 3-yr state/local tax burden Salary in pocket after state tax Cost of living (2014 Q3) Adjusted post-tax salary power Additional purchasing power from working here instead of SD
IA $89,700 $11,220 $78,480 92.8 $84,569 $9,925
MN $98,140 $14,574 $83,566 101.2 $82,575 $7,931
MT $84,610 $9,411 $75,199 102.1 $73,652 -$992
ND $109,070 $12,171 $96,899 101.7 $95,279 $20,635
NE $88,320 $11,973 $76,347 97.7 $78,144 $3,500
SD $84,920 $9,156 $75,764 101.5 $74,644 $0
WY $114,370 $10,500 $103,870 94.4 $110,032 $35,387
Welding, Soldering, and Brazing Machine Setters, Operators, and Tenders
State 3-yr income 10th-25th-50th 3-yr state/local tax burden Salary in pocket after state tax Cost of living (2014 Q3) Adjusted post-tax salary power Additional purchasing power from working here instead of SD
IA $96,660 $11,220 $85,440 92.8 $92,069 $9,494
MN $90,550 $14,574 $75,976 101.2 $75,075 -$7,500
MT $92,390 $9,411 $82,979 102.1 $81,272 -$1,303
ND $96,500 $12,171 $84,329 101.7 $82,919 $344
NE $93,290 $11,973 $81,317 97.7 $83,231 $656
SD $92,970 $9,156 $83,814 101.5 $82,575 $0
WY $125,750 $10,500 $115,250 94.4 $122,087 $39,511

Clearly, Wyoming beats us all for welding wages. A welder who stays in South Dakota instead of moving to Wyoming gives up over $35,000 in purchasing power over three years. A welding machine operator making the same choice gives up over $39,000. Choose South Dakota over Minnesota, and the welder loses over $7,900, but the welding machine operator gains $7,500.

But where the rubber hits the road—or where the vo-tech student doesn't!—is the scholarship question. Denny D. and Denny S. are offering you sharp welders (come on, after all this talk, you're going to include welders in the scholarship, right, guys?) $15,000 in tuition savings. If those welders don't take the scholarship because they want to work out of state, they have to earn back the $15,000 they spent on school.

Only the Wyoming and North Dakota welders and the Wyoming welding machine operators make more than $15,000 above the typical wages in South Dakota. The Build Dakota Scholarship will be worth it for a lot of welding candidates.

Let's try another job field. Our benefactor Mr. Sanford is all about health care, so let's assume we'll promote some health tech jobs. How will radiologic technologists do?

Radiologic Technologists
State 3-yr income 10th-25th-50th 3-yr state/local tax burden Salary in pocket after state tax Cost of living (2014 Q3) Adjusted post-tax salary power Additional purchasing power from working here instead of SD
IA $116,610 $11,220 $105,390 92.8 $113,567 $14,184
MN $143,620 $14,574 $129,046 101.2 $127,516 $28,133
MT $121,360 $9,411 $111,949 102.1 $109,646 $10,263
ND $112,720 $12,171 $100,549 101.7 $98,868 -$515
NE $118,630 $11,973 $106,657 97.7 $109,168 $9,785
SD $110,030 $9,156 $100,874 101.5 $99,383 $0
WY $132,090 $10,500 $121,590 94.4 $128,803 $29,420

Again, assuming a $15,000 scholarship value, the potential Build Dakota Scholarship recipient thinking about leaving South Dakota to work in radiology for Montana, North Dakota, or Nebraska will want to think again. Future radiologists eying Minnesota or Wyoming will tell Dennis, "No deal!" Radiological aspirants looking at Iowa will have a tougher choice: for them, Build South Dakota and three years locked into South Dakota offers them less than a thousand-dollar net advantage.

How about bus and truck mechanics and diesel engine specialists?

Bus and Truck Mechanics and Diesel Engine Specialists
State 3-yr income 10th-25th-50th 3-yr state/local tax burden Salary in pocket after state tax Cost of living (2014 Q3) Adjusted post-tax salary power Additional purchasing power from working here instead of SD
IA $87,200 $11,220 $75,980 92.8 $81,875 -$5,311
MN $106,830 $14,574 $92,256 101.2 $91,162 $3,976
MT $90,440 $9,411 $81,029 102.1 $79,362 -$7,824
ND $110,530 $12,171 $98,359 101.7 $96,715 $9,529
NE $83,210 $11,973 $71,237 97.7 $72,914 -$14,272
SD $97,650 $9,156 $88,494 101.5 $87,186 $0
WY $120,030 $10,500 $109,530 94.4 $116,028 $28,841

Even without Build Dakota, if you're into diesel engines, you lose money leaving South Dakota for Iowa, Montana, or Nebraska. The four-figure puchasing-power gains promised by Minnesota and North Dakota don't beat the $15,000 value of our new vo-tech scholarship. But once again, Wyoming is the land of opportunity. Skip the scholarship, head for Sheridan, and in three years, you'll have earned back your tuition and cleared another nearly $14,000 over what you would have made back in Aberdeen.

I'd compare wind turbine service technicians, but South Dakota apparently doesn't have enough jobs in that field for BLS to count. (Hmm.... Governor Daugaard, you and the PUC could do something about that, couldn't you?) Job opportunities in that field are numerous enough to count in Wyoming, Iowa, Minnesota, and North Dakota, where the median annual salary for fixing wind turbines is $55,550.

Whatever the exact numbers above, the Build Dakota Scholarship makes working in South Dakota for the first three years of one's technical career more appealing. Possible future earnings in welding or radiology or diesel mechanicry in another state don't matter to the young person who can't get those jobs because she doesn't have the cash right now to go to vo-tech. Plus, with their "stay in South Dakota" requirements, our scholarship plans "get our hooks" into young workers early: in those first three years, they'll accumulate connections and obligations that will incline some fraction of them to stay, despite the greater earning potential available in many fields in most other states.

And therein lies the sneaky and arguably irresponsible part of these scholarship plans. The state is not investing in a long-term plan to raise wages (which would raise economic activity, which would raise tax revenues, which would raise the amount and quality of public goods...). The state is using its resources and Denny Sanford's resources to rope young people into working for less competitive wages. The state and Sanford are going to great lengths (and putting up real money is the greatest length our state government can go to) to keep their business pals from solving their own workforce shortages with the obvious free-market solution of offering bigger paychecks.

Vo-tech students, do your own math for your own field, and tell us whether the Build Dakota Scholarship will sway your decision to stay and work in South Dakota. Fellow South Dakotans, let's ask ourselves whether we do more to address a workforce shortage by lowering workers' entry costs or raising workers' ongoing wages.

Main data sources:

  1. Cost of living: 2014 Q3 C2ER data from MERIC: http://www.missourieconomy.org/indicators/cost_of_living/index.stm
  2. State + local tax burden: SD GOED: http://sdreadytowork.com/South-Dakota-Advantages/50-State-Comparison.aspx
  3. Wages: Bureau of Labor Statistics State Occupational Employment and Wage Estimates, May 2013: http://www.bls.gov/oes/current/oessrcst.htm

Final Thought: The state has an obligation to educate citizens. Business has an obligation to train workers. Would Adam Smith agree?

15 comments
Kurt Evans speaking at the South Dakota Libertarian Convention, Sioux Falls, SD, August 9, 2014. Photo by Ken Santema.

Kurt Evans speaking at the South Dakota Libertarian Convention, Sioux Falls, SD, August 9, 2014. Photo by Ken Santema.

Kurt Evans plans to run for U.S. Senate in 2016. Evans will seek office as an Independent. He is the first candidate to declare for any of South Dakota's three statewide offices in 2016 (U.S. Senate, U.S. House, and Chris Nelson's seat on the Public Utilities Commission). Evans will run for the seat currently occupied by Senator John Thune, the GOP's number-three man in the upper chamber.

Evans is running because of his concerns about privacy and civil liberties. Evans says the intelligence community has been unconstitutionally seizing our telephone and Internet data. Evans predicts he would be "less inclined than Senator Thune to accept the intelligence community's self-justifying propaganda at face value."

On the economy, Evans is less worried about fiscal policy and more worried about monetary policy and the dastardly Fed: according to Evans, the Federal Reserve is inflating the money supply, which will lead to hyperinflation and the destruction of the dollar... unless Senator Evans can stop them.

On foreign policy, Evans opposes "meddling in the affairs of other nations, especially in the Middle East."

These positions support Evans's self-description as a "reasonably consistent pro-life libertarian," but notice he's not capitalizing that l. Evans says he will run as an Independent. He ran unsuccessfully for state auditor under the Liberatarian banner this year ("unsuccessful Libertarian"—that's redundant, right?). South Dakota Libertarians lost their official party status this year after failing to field a gubernatorial candidate. Evans is hanging onto his libertarian philosophy, but he says he has left the Libertarian organization "mainly due to a lack of honest communication by the members of the state party's executive committee." (Communication may be complicated by the fact that, prior to the November election, one of the five SDLP board members appears to have returned to his permanent home in Texas. Following the election, the party chair also left the state, for Colorado.)

Evans ran for Senate as a Libertarian in 2002 against Thune and incumbent Tim Johnson. He ended his campaign in late October, but his name remained on the ballot, and he drew 3,070 votes, six times the slim 532-vote margin of victory by which Thune failed to beat Johnson.

Evans thinks he can poll much better in 2016, based on the lessons of the 2014 Senate race. By Evans's read, this year's run by Larry Pressler showed that Independent candidates can at least poll in the double digits (Pressler broke 17%, far from a win, but better than any recent non-major-party Senate candidate in South Dakota). Evans reads a different lesson in the more typically low-polling (3%) Independent bid by Gordon Howie: "announcing after another non-major-party candidate has already entered the race creates a significant disadvantage."

Like Pressler, Evans will need to craft pitches that will appeal across party lines. Evans says he can win Republican votes with most of his domestic policy. He will pitch his foreign policy and positions on civil liberties to Democrats. He hopes his overall approach to politics will appeal to Independents. "Under most circumstances, though," says Evans, "I try to avoid thinking of people in groups."

Evans sees ill in grouping and labeling people. But even he can slip. As he gets ready to run, Evans acknowledges his own fallibility and asks our forgiveness:

I believe it's wrong to use pejorative labels that devalue and dehumanize other people, but last month I referred to Pat Powers as a 'Mary-worshipping douchebag' in an anonymous comment at South Dakota War College. I apologize to my fellow participants in South Dakota's political blogosphere for that very bad decision [Kurt Evans, e-mail to Madville Times, 2014.12.17].

Evans recognizes the value of respectful, intelligent, issue-oriented conversation, and he's willing to apologize when he slips from that standard. Let's hope he holds to that standard as he works to build a Senate campaign that he can sustain through November 8, 2016.

25 comments

The new Sanford-funded Build Dakota vo-tech scholarship program includes some gravy for Lawrence & Schiller. Out of $25 million from T. Denny Sanford and $25 million from the Governor's Future Fund, the state will spend 0.5%*, $250,000, on marketing the scholarships and the jobs they target.

Now hold on: the state is going to offer free vo-tech programs to 300 students a year for the first five years, then 50 more a year. That's free education. Free pretty much markets itself. The reps from Southeast, Lake Area, Mitchell, and Western Dakota don't need a TV campaign; they just keep doing their high school visits and add one line to their pitch: "By the way, it's free." Boom—marketing done!

We won't need to market the jobs any more than the scholarships. Those first 300 scholarshipped vo-tech graduates will be required to work in South Dakota for three years or pay back the money. They won't need an ad campaign to point them to their required payback.

Maybe the marketing budget is just a gift to the state's favored ad agency Lawrence & Schiller, a Christmas congratulations for their great work on the safe-driving campaign. Now what can we do to get Mitchell Tech on The Daily Show?

First draft, Sanford Build Dakota Vo-Tech Scholarship ad

First draft, Sanford Build Dakota Vo-Tech Scholarship ad (Background from Mitchell Tech website; text by Madville Times Marketing Division)

P.S.: The South Dakota Department of Education already lists the Build Dakota vo-tech scholarship on its website. I'll bet that marketing didn't cost $250,000.

*Correction 16:09 CST: The original version of the story mistakenly listed the marketing budget as 2% of the planned $50 million. I regret the error and will remind my next math class to always check their work.

49 comments

Arizona/South Dakota billionaire T. Denny Sanford is using $25 million of his usury-gotten fortune to keep South Dakota state government from coming up with more of its own money to address workforce development. How very nice.

I suppose it's impolite to pester an elderly benefactor about the literal content of statements made in a fit of boosterism. But permit me to look at a few words from the gift horse's mouth, uttered yesterday at the rollout of the new Build Dakota vo-tech scholarship plan:

"I'm proud of everything that South Dakota stands for," Sanford said. "Productivity, a great health system and South Dakota Works. And it works in a good way. Not only do people work harder and have a better work ethic, but the system works. We've got a system unequal to anything else I've seen. We've got to get the people here to do it."

..."Go forward, South Dakota; let's get it done," Sanford said. "I know you will because everything we do here works" [Jodi Schwan, "Sanford, State Pledge $50 Million for Workforce Needs," that Sioux Falls paper, 2014.12.17].

Everything we do here works... that statement makes it hard to explain why we need this scholarship program in the first place. What happened to the New South Dakotans program that was Governor Daugaard's first big swing at workforce recruitment? Oh yeah: it didn't work. And if everything we have here works, why do we have a teacher shortage? And a road-repair shortage?

But we South Dakotans still work harder than everyone else, right? We have a better work ethic, right?

  1. A Bureau of Labor Statistics report from 2010 says that in 2008, South Dakota ranked 47th for average weekly hours and 51st for average hourly earnings in private industry.
  2. From 1977 to 2000, 25 states had higher annual labor-productivity growth than South Dakota. Our labor-productivity growth improved from 2000 to 2004, thanks to our riding out the 2001 recession a little better than the rest of the country, but 13 states still beat us on that metric in that period.
  3. This is a crude figure, but if you divide our gross state product by our population in 2013, you find that South Dakota ranks 22nd for economic output per person (see full chart below). However hard they are working, folks in 21 other states are generating more wealth per person than South Dakotans. The only neighboring state producing less wealth per person is Montana, which ranks 42nd in GSP per capita.
  4. Working harder isn't exactly a sign of progress. How hard do you think Mr. Sanford is working right now? American workers put in more hours than their European counterparts but report less life satisfaction.

I suppose the state's official position should be that Denny Sanford can say the sky is blue and Elvis is President, as long as he keeps the money coming. Denny Sanford can build our hospitals and schools and workforce... but let's not let him fabricate our facts.

State 2013 GSP $ Millions Population (2013) GSP/pop GSP/pop rank
Alabama 180,727 4,833,722 $37,388.79 47
Alaska 51,542 735,132 $70,112.58 2
Arizona 261,924 6,626,624 $39,526.01 41
Arkansas 115,745 2,959,373 $39,111.33 43
California 2,050,693 38,332,521 $53,497.47 13
Colorado 273,721 5,268,367 $51,955.57 18
Connecticut 233,996 3,596,080 $65,069.74 5
Delaware 58,028 925,749 $62,682.22 7
District of Columbia 105,465 646,449 $163,145.12 1
Florida 750,511 19,552,860 $38,383.69 46
Georgia 424,606 9,992,167 $42,493.89 37
Hawaii 70,110 1,404,054 $49,933.98 20
Idaho 57,029 1,612,136 $35,374.81 50
Illinois 671,407 12,882,135 $52,119.23 17
Indiana 294,212 6,570,902 $44,774.98 31
Iowa 150,512 3,090,416 $48,702.83 21
Kansas 132,153 2,893,957 $45,665.16 28
Kentucky 170,667 4,395,295 $38,829.48 44
Louisiana 222,008 4,625,470 $47,996.85 24
Maine 51,163 1,328,302 $38,517.60 45
Maryland 322,234 5,928,814 $54,350.50 11
Massachusetts 420,748 6,692,824 $62,865.54 6
Michigan 408,218 9,895,622 $41,252.38 39
Minnesota 289,125 5,420,380 $53,340.36 14
Mississippi 96,979 2,991,207 $32,421.36 51
Missouri 258,135 6,044,171 $42,708.09 35
Montana 39,846 1,015,165 $39,250.76 42
Nebraska 98,250 1,868,516 $52,581.83 15
Nevada 123,903 2,790,136 $44,407.51 33
New Hampshire 64,118 1,323,459 $48,447.29 23
New Jersey 509,067 8,899,339 $57,202.79 9
New Mexico 84,310 2,085,287 $40,430.89 40
New York 1,226,619 19,651,127 $62,419.78 8
North Carolina 439,672 9,848,060 $44,645.54 32
North Dakota 49,772 723,393 $68,803.54 3
Ohio 526,196 11,570,808 $45,476.17 29
Oklahoma 164,303 3,850,568 $42,669.81 36
Oregon 211,241 3,930,065 $53,750.00 12
Pennsylvania 603,872 12,773,801 $47,274.26 26
Rhode Island 49,962 1,051,511 $47,514.48 25
South Carolina 172,176 4,774,839 $36,059.02 49
South Dakota 41,142 844,877 $48,695.85 22
Tennessee 269,602 6,495,978 $41,502.91 38
Texas 1,387,598 26,448,193 $52,464.76 16
Utah 131,017 2,900,872 $45,164.70 30
Vermont 27,723 626,630 $44,241.42 34
Virginia 426,423 8,260,405 $51,622.53 19
Washington 381,017 6,971,406 $54,654.25 10
West Virginia 68,541 1,854,304 $36,963.19 48
Wisconsin 264,126 5,742,713 $45,993.24 27
Wyoming 39,538 582,658 $67,857.99 4
15 comments

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