Rep. Steve Hickey brings us the Statesman-Prepper bill of 2015. House Bill 1086 would create the Economic Contingencies Work Group to study how the state would respond to what Rep. Hickey has called the "Long Economic Winter." Gently revising a summer-study proposal he pitched last year, Rep. Hickey asks the state to consider how it would confront an extended national economic crisis severe enough to cripple the federal government, disrupt the food and energy distribution networks, and drive us to local self-sufficiency and bartering.

Appropriately, the work group would have thirteen members.

The bill doesn't mention plague or war (O, Jericho, sweet Jericho!), but you know the millennialists who were disappointed at the Y2K non-event are thinking what fun it will be to write the discussion of any of the Four Horsemen onto the Legislature's agenda. I'll admit, the discussion could be a profound exercise in political and economic science. How well could South Dakota survive on its own? Would we be willing to nationalize (wait: what is the word for when a state government takes over private property and economic activity? state-alize?) farm land and farm equipment to ensure that enough beef, grain, and vegetables are grown to feed every citizen? Would we order our Guard troops to raid North Dakota and Wyoming for oil and coal, or would we take a safer defensive posture, convert all of our vehicles to run on electricity and ethanol, commandeer the dams on the Missouri River, and draft engineers and linemen to reconfigure the grid to provide electricity to sustain our state?

Thirteen Legislators of the Apocalypse could have a riotous summer thinking up disaster scenarios and plans for maintaining law, order, and tolerably good wine in the worst of times. Heck, I support governmental action to prepare for asteroid collisions (whew! survived another one—wait, two, Skipper and Little Buddy, Monday night!), and the last five thousand years have brought us more collapses of economies and empires than asteroid collisions. So go ahead, South Dakota Legislature, let's spend the summer talking about Rep. Hickey's Long Economic Winter... and amend the bill to include fewer legislators and more writers, futurists, and other creative types who can really probe the possibilities!

Related Reading: Maybe reading some alternative history would be useful bedtime reading for students of the Long Economic Winter. 1983: Doomsday is an alternate-history wiki-narrative created by multiple users imagining world history spun off from a nuclear war in 1983. In that timeline, the Lakota take West River; East River unites with the eastern part of North Dakota to form one state and moves the capital to Aberdeen.

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Freshman Rep. Alex Jensen (R-12/Sioux Falls) seems to think it would be a good idea to repeal some laws dealing with county officials. House Bill 1081, Rep. Jensen's first bill in the hopper, would make three changes to state law:

  1. Repeal the mileage reimbursement that state law currently requires counties to pay to all county officials except for sheriffs.
  2. Take away the power of county commissioners to procure a copy of the field notes of the original field survey of the county and order a big map be drawn therefrom.
  3. Erase the duty of the county commission to visit the county jail once a year during a regular meeting.

I invite discussion of possible reasons to make these changes. Over breakfast, I can think of no good ones.

  1. We should pay county officials for the travel expenses they incur doing our public business. SDCL 7-7-24 makes sure we don't short our public servants.
  2. I like those big county maps! They help me pass the time when I'm waiting for Deb to get off the phone. SDCL 7-8-22 does mandate anything; it just says that if the commission wants a map, it can get one.
  3. I don't think anyone county jailers are running the Gulag Rura Penthe, but it doesn't hurt to have one little bit of oversight. We put people in cages; we should have an obligation to look at those cages, at least once a year, to make sure we're o.k. with the condition of those cages and the offenders therein.

Repealing mileage reimbursement, map rules, and jail oversight didn't figure among candidate Jensen's priorities during the 2014 campaign. Jensen said he'd work on health care, education, and business-friendliness; HB 1081, his only bill so far, appears to do nothing about those issues. But I guess the party leadership has to keep its trainees busy with something.

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Members of the Government Operations and Audit Committee have brought forward two bills that appear to target the gross conflicts of interest in South Dakota's EB-5 visa investment program. GOAC only glancingly acknowledged these violations of state law and policy and blamed what little it acknowledged on the dead Richard Benda while ignoring the violations committed by the very much alive and enriched EB-5 czar Joop Bollen.

One bill would make things better. One bill would make things worse. Guess which one GOAC members appear to prefer?

House Bill 1023 was the first Benda-Bollen bill submitted by Rep. G. Mark Mickelson (R-13/Sioux Falls) and six other 2014 GOAC members who returned to Pierre this session. It amends SDCL 5-18A-17 to extend an existing conflict-of-interest prohibition on state contracts (which already bans the kind of goofy contract Bollen signed with himself in January 2008) to cover state officials and employees for one year after they leave office (which would have banned Richard Benda's golden parachute with Bollen's state-contracted EB-5 management company SDRC Inc.). HB 1023 is short, simple, and sensible.

Rep. Mickelson threw his second Benda-Bollen bill, House Bill 1064, into the hopper just today. It has the same seven sponsors, plus Senator Deb Peters (R-9/Hartford). HB 1064 repeals the statute that HB 1023 amends, indicating this later Benda-Bollen bill is meant to replace the first. HB 1064 amends and expands SDCL 3-16 to ban self-dealing contracts as well as define exactly what kinds of "interests" the state will consider conflicts.

But check out the power Section 5 gives to the Governor and other executives to make exceptions:

A governing body may authorize an officer or employee whose responsibilities include approving, reviewing, or negotiating a contract on behalf of a state agency or supervising any employee who has these responsibilities to be a party to or derive direct benefits from a contract if:

  1. The governing body has reviewed the essential terms of the transaction or contract and the state officer's or employee's role in the contract or transaction; and
  2. The transaction and the terms of the contract are fair, reasonable, not contrary to the public interest, and fully disclosed in writing to the governing body.

The authorization, which may not be unreasonably withheld by the governing body, shall be in writing. The governing body may adopt a written plan to manage any perceived, potential, or real conflicts of interest associated with the state officer's or employee's role in a contract or transaction.

Any authorization given pursuant to this section is a public record. Each authorization shall be filed with the commissioner of the Bureau of Human Resources, who shall compile the authorizations and present them annually for review by the Government Operations and Audit Committee [House Bill 1064, Section 5, as published 2015.01.20].

House Bill 1064 defines conflicts of interest, extends the prohibitions against them, then grants the Governor, the Attorney General, and other Pierre potentates the power to pish-posh those prohibitions.

As an anti-bonus, Section 3 says the one-year post-employment extension only applies to contracts that would benefit the state official or employee in question to the tune of $100K or more. In other words, use your state job to write yourself a private contract that kicks in after you leave Pierre, and as long as you limit your pay to $99,999.99, you're in the clear.

Making sure we look out for our friends, Section 4 further dilutes the conflict-of-interest prohibitions by exempting state officers and employees whose ownership interest in a contracting entity is only 5% or less and by narrowing the definition of "direct benefit":

A state officer or employee does not derive a direct benefit from a contract based solely on the value associated with the officer's or employee's investments or holdings, or the investments or holdings of other adults with whom the state officer or employee lives and commingles assets, in an entity that is a party to the contract provided the officer or employee does not meet the requirement contained in subdivision (1) of this section [HB 1064, Section 4].

Call this the Skjonsberg Provision: last October, Lee Fang of The Nation discovered that Rob Skjonsberg, manager of the Rounds for Senate campaign, had cast a vote on the state Board of Economic Development to invest state dollars in Novita LLC, a company in which his investment company Lake Sharpe Investments had an interest. Skjonsberg said there was only a perception of conflict of interest, and state officials backed him up, saying Skjonsberg did not have a direct interest in Novita LLC. But the above passage of HB 1064 seems crafted to make explicit the fact that no, really, high rollers on the Board of Economic Development can keep voting money to projects in their indirect portfolios.

Both bills have been referred to ouse Judiciary, which Rep. Mickelson chairs. We'll see if he uses his position there to withdraw the simpler, stricter HB 1023 and promote the diluted, exemption-riddled HB 1064.

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Need help figuring out your 2014 federal tax return? Don't count on the Internal Revenue Service. The National Taxpayer Advocate's latest report to Congress says the IRS lacks the staff and funding to serve taxpayers:

  1. The IRS will be able to answer only 50% of the 100 million calls it will receive from taxpayers this fiscal year.
  2. Callers will often wait 30 minutes to speak to an IRS rep.
  3. In 2004, the IRS answered 87% of its calls, with an average hold time of 2.5 minutes.
  4. Last year, the IRS dropped tax prep service "for hundreds of thousands of low income, elderly, and disabled taxpayers who sought assistance."
  5. Voluntary and timely tax payment provides 98% of the federal government's revenue. Providing good customer service collects revenue far more efficiently than enforcement actions against taxpayers who don't file correctly or at all.
  6. Since FY2010, Congress has reduced the IRS budget 9.9% in straight dollars and 17.7% in inflation-adjusted dollars.
  7. Since FY2010, budget cuts have caused the IRS to cut workforce by 12.3%.
  8. Since FY2010, the IRS has cut its training budget by 87%. In a complicated field where rules and procedures change every year, the amount available to spend on training for each employee (FTE) has dropped in five years from $1,774 to $339.
  9. The IRS managed to answer a bit more its mail on time last year than the year before, but it still failed to process 51% of adjustments (i.e., "You owe us" or "We owe you") correspondence in its standard 45-day timeframe.

That lack of customer service is just one of multiple serious problems the National Taxpayer Advocate's office identifies at the IRS. We could ask for no better example of how smart government sometimes means bigger government: if we want more taxpayers to get answers to tax questions in less time, we need more staff with more training on more phones.

But Senator John Thune appears to prefer self-destructive failure:

Republicans who now control Congress and who led the effort to reduce the IRS budget don't seem too concerned about the agencies woes. It goes back to GOP charges that the agency targeted conservative groups seeking tax exempt status for extra scrutiny.

Republican Sen. John Thune of South Dakota: "I don't think that based on the IRS' record over the last couple of years that there's a whole lot of sympathy for the complaints that they're now making about not having enough funding. Obviously they have a job to do, it's an important job we want to make sure they have the resources to do that job to collect the taxes but wasting resources targeting conservative groups and other things like that is obviously something that we would take great issue with" [Brian Naylor, "IRS Budget Cuts May Make for an Unpleasant Tax Filing Season," NPR: Morning Edition, 2015.01.20].

The Cincinnati IRS office oversteps its bounds, and Senator Thune decides to strangle the entire IRS and leave taxpayers at sea. That makes about as much sense as a teacher reacting to one student scribbling on a desk by taking away everyone's writing utensils and then flunking the kids for not finishing their penmanship assignments. It's almost as if Senator Thune doesn't want us to submit our homework—er, taxes (ah ha! so that's his game!).

The Internal Revenue Service is not some partisan enemy. It is an essential arm of government, without which the ship of state sinks. Senator Thune and Congress can impose the necessary oversight on the IRS and still provide the resources to help tens of millions of taxpayers file their taxes correctly and on time.

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Republicans most likely went looking for a constitutional excuse to can Kathy Tyler because of her outspoken criticism of the EB-5 scandal brought to us by the Rounds-Daugaard regime. But Republicans probably also don't like the former Milbank legislator's criticism of  the current administration's only noteworthy education initiative, the Build Dakota Scholarship for vo-tech students:

Why should we as a state fund a student’s entire post-secondary education so that he or she can get a job for a private company? Yes, there is the three year, stay in South Dakota caveat, but is it a state’s job to train workers for private companies? I don’t think so. We don’t pay to train state employees and we certainly don’t offer scholarship programs to them. And I won’t even start on the teacher shortage [Kathy Tyler, "Build Dakota Scholarship," Kathy's Corner, 2015.01.05].

Tyler raises a good question for our legislators to debate: is this subsidy for workforce training really within the proper role of state government. The Build Dakota Scholarship serves to support the low-wage system that is the root cause of the workforce problem. It targets education that does not offer the highest chances for full-time employment. As Tyler suggests, it seems a bit drop-in-the-buckety compared to other pressing education and workforce needs in the state.

Tyler also catches a whiff of partisan selectivity in Republican support for this scholarship plan:

The Build Dakota Scholarship applies to certain programs at certain technical institutions. These programs train students in high-need workforce areas. There will be 300 full ride scholarships for five years and then 50 per year. The full ride scholarship is open to resident and non-resident students. I have to smile at that. Last year, I sponsored a bill to allow out-of-state students who attend South Dakota high schools to be eligible for the $1000 per year Opportunity Scholarship given to top high school seniors. It didn’t pass. It must have been the letter behind my name [Tyler, 2015.01.15].

Tyler refers to her 2014 House Bill 1078. This partial scholarship would have had to have recruited several hundred high-achieving non-resident students to cost as much as the full-ride Build Dakota Scholarship. Tyler pushed her bill through three votes before the full Senate finally killed it. Every vote against the bill was Republican.

Reaching for my lemonade squeezer, I notice that, in this blog post written before session started, Tyler noted that she would have to stay mum on political issues once she took her position as a state employee. The good side, then, of Speaker Wink kicking Tyler out of the House Dems' caucus secretary job is that we can hear more of her observations and analysis on Legislative matters like the Build Dakota Scholarship. Keep speaking up, Kathy!

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Sixteen groups applied last November for workforce development grants from the South Dakota Workforce Initiative. The Workforce Development Council rejected just two of those applications: Madison's and Sioux Falls's.

I'm willing to bet that the council rejected Madison's just because it was Darin Namken pitching new online banners with slogans and logos as underwhelming as the old ones his people came up with. Madison's application was just pork to pay Namken's people $5,000 to fiddle with search engines and post vacuous comments to social media. The application says Madison has a housing shortage, a problem the proposed marketing program does nothing to fix, but then goes on to say that Madison already has successful programs in place to recruit workers. I skim the application and see no compelling case to hand Namken's company more free public dollars.

Madison's plan was weak, but at least they offered a plan. Sioux Falls got rejected, apparently because they wanted state money to pay for thinking about a plan. Forward Sioux Falls applied for $56,433 to pay a third of the cost for having consultants help them develop a workforce development plan. (What? People can get paid six figures just for sitting around helping people think? I do that job in the classroom all the time, and I never get six figures for a gig! I need to rebrand: I'm not a teacher; I'm a brainforce development consultant.)

And let's get real: Sioux Falls needs the least assistance developing its workforce. Almost every other town in this state loses workers to Sioux Falls, because Sioux Falls, in the South Dakota scheme of things, has almost everything. Their application and their own woe-is-us reaction to the state's rejection in today's paper state that Sioux Falls has growing and diverse industries. Its population is growing at nearly twice the state rate. The city offers more opportunities, more people, and more money. In an environment like that, the workforce pretty much develops itself.

The proper role of government is to help along those worthy projects that aren't happening on their own. Madison already has the tools it needs to Tweet job openings. Sioux Falls already has the economic and cultural attraction to build its workforce. The state can justify focusing its meager workforce development resources elsewhere.

You can peruse the fourteen winning applications here and see how Aberdeen, DeSmet, the Associated General contractors, and eleven other organizations snagged their pieces of government pie.

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The Tax Foundation reminds us that South Dakota continues to stay afloat on red-state moocherism. Our conservative one-party state relies on the federal government for a greater percentage of its general revenues than all but three other states:

Federal-Aid-as-a-Percentage-of-State-Revenue_0

(click to embiggen!)

 

South Dakota got 40.8% of its general fund revenues from Uncle Sam in Fiscal Year 2012. Only Tennessee, Louisiana, and Mississippi got bigger portions of their pie from the feds.

When I reported the Tax Foundation's figures on this topic two years ago, South Dakota was at 45.56%. Governor Dennis Daugaard's proposed FY2016 budget brings that federal percentage down to 38.9%. Gee, Pastor Hickey: it looks like Governor Daugaard is already soft-landing us for that Long Economic Winter! (See Rev. Hickey's September 14–20, 2014, podcasts on the topic.)

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When incoming Secretary of State Shantel Krebs announced she was hiring Brown County GOP chairman Jason Williams to serve as her public information officer, I wondered if she was expanding government to make room for what looked like a little partisan patronage.

Secretary Krebs tells this blog there's no government expansion going on under her watch. Secretary Krebs says that, while she is still bound by law to operate under her predecessor Jason Gant's budget until the end of the fiscal year on June 30, she's already making the office run leaner. Gant's budget included 15.6 full-time equivalents (FTEs). Right now, Secretary Krebs is holding down the fort with 13.5 FTEs. That's not just a temporary lag in bringing new people on board; Secretary Krebs says that's plenty. The Secretary's office has not prepared a budget proposal yet (they have petition reform legislation to write up for tomorrow's pre-filing deadline—stay tuned for a post on that topic over the weekend!), but Secretary Krebs says that instead of continuing the 15.6 FTE allocation found in Governor Daugaard's FY 2016 proposal, she may knock another half FTE off her current staff and budget 13.0 FTE.

Multiple Krebs staff members are thus picking up duties that were spread among others in the Gant office. Secretary Krebs says PIO Williams is no exception. In addition to getting the word out about SOS activities to the public, Williams will handle special projects, like Secretary Krebs's initiative to increase voter turnout. Secretary Krebs says Williams is already studying turnout data, breaking it down by age group, and thinking about which voters to target and how. Expect PIO Williams to be getting out to schools, talking with voters, and looking for answers to our dwindling turnout.

In addition, Williams will track legislation for the Secretary of State's office. He'll be following the progress of the reforms proposed by the Board of Elections. He'll also keep an eye out for new bills from legislators and researching their impact on the office. He'll report on those bills to the boss, the Secretary herself, who will then speak to legislators in committee and in the lobby, as necessary, to protect the interests of fair elections and other functions of the Secretary of State.

Secretary Krebs says Williams and the rest of her staff are putting in overtime and delivering "exceptional" customer service. The Secretary herself seems to be setting the pace. Consider that, in response to a media inquiry from this blog, the Secretary herself texted me at 6:25 a.m. today. She had meetings all day, but she arranged to visit with me on the phone at 6:30 p.m. She said she had 10 minutes; she gave me 19.

I did not keep track of the multiple times I left messages for Secretary Gant and never heard back from him. But so far, Secretary Krebs is batting 1.000 on fielding media requests from the Madville Times. Perhaps the state's chief election officer has bigger fish to fry than speaking to some blogger, but I find my first interaction with the new election chief... satisfactory.

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