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Brookings vs. Bison: Who Should Get Priority in Economic Development Aid?

Under the authority of this year's Senate Bill 235, Governor Dennis Daugaard handed out another $1.8 million this month to various communities and businesses around the state for economic development. These funds follow a quarter million handed out to 3M in Brookings and $600K to Marmen Energy in Brandon.

Last spring, I noted that South Dakota's economic development efforts seem to flow toward communities that are doing pretty well on their own, perhaps at the expense of smaller communities losing talent and dollars to their bigger neighbors. One could argue that Governor Daugaard is continuing that pattern with his SB 235 money. In these two rounds of funding, over 50% of the money has gone to Brookings County. The biggest single recipient is the new and well-heeled Novita LLC, which gets $771K to build a plant in Brookings County to make distillers meal and grain oil.

But Governor Daugaard is spreading the wealth to more rural areas. Infrastructure money is going to Sturgis and Alexandria. More economic dollars are going to Belle Fourche, the Southern Black Hills, Bison, and Sisseton. As we see with the example of Alexandria, a small investment can make a big difference, arguably a bigger difference than those same dollars would make in a big growing community like Brookings or Brandon.

Money follows money. The Governor likely receives more pitches from bigger investors for bigger projects in bigger towns. But those big investors are in the big towns because those communities already have lots of advantages to attract their dollars and dreams.

So the question remains: given the market advantages towns like Brookings and Brandon already have, should the state's economic development programs give priority to smaller communities like Bison and Alexandria?


  1. Rick 2013.09.28

    Good question, Cory. It speaks exactly to the purpose of taxes being used to incentivize economic growth. What kind of South Dakota do we want the state to become? And what are the political payoffs returning to the people who shell out our taxes to wealthy corporations? If a $1 million handout or low interest loan to a large corporation helps to produce a $10,000 campaign donation to the governor's re-election, who's the big loser here? Or how about the bundling practices of pacs and the Governor's Club to double or triple the payback to receiving the handout?

    I've never been comfortable with handouts coming from Pierre. The money goes to the safe bets. The money trails of handout recipients who become big hitter donors create more disappointments. And in the end, it feels the state's economy is only running in place with no direction known.

    The thing George S. Mickelson did best was to involve a very wide circle of people, even invited Democrats, to create a vision when he revolutionized an economic development/jobs creation program. None of his successors have bothered to stick out their necks to set a new course.

    Dennis, stick out your neck. It's time for a new vision. Widen the circle. Not everybody needs to agree with you on 100 percent of your political views. But if you want to be viewed as a visionary governor, PROVE IT.

  2. Tasi Livemont 2013.09.28

    Sad thing is it isn't always a 'sure bet.'

    And with no claw backs this type of corporate welfare is more damaging to those pulling up their communities by their bootstraps or trying to.

    Brookings is doing well now but not always. I say money follows decent Downtowns. And that is always the work of the locals. Though some grants for building and street improvements would be money better spent I believe.

  3. Cranky Old Dude 2013.09.28

    Money flows to votes. The more votes you have in an area, the more money you get.
    These things leave me a bit conflicted: nice that somebody somewhere appears to be getting ahead but where did the money actually come from? Are we just sucking out of the populace's pockets to deposit it in some corporate pocket? Is this actually Economic Development or just Redistribution of Wealth at the mercantile level?
    This is why some of us don't trust government being allowed to muck around in the economy in the first place.

  4. Douglas Wiken 2013.09.28

    Taxpayers should be getting stock in all these ventures that get grants. It is a form of forced capital accumulation; but those contributing should have ownership. If it flies, the actual taxpayers also benefit. If it crashes, nothing has changed, taxpayers are screwed as usual.

  5. Michael Black 2013.09.28

    I thought you were against government handouts for development?

  6. Owen Reitzel 2013.09.28

    A grant for a city, in Alexandria's case for water and sewer, goes for the benefit of all. Besides the factory that's going up now there could be more industry coming in thus helping the city creating jobs and revenue, That infrastructure is going to stay in the ground and not leave.
    Give that money to a corporation and in 5 or so years that money the might leave along with the money given too them. I know I worked for such a company.

  7. peermudd 2013.09.28

    Rick, I would agree somewhat, but I would not consider the previous bets in an Aberdeen beef plant or a Spearfish, motorcycle conversion company as safe.

  8. interested party 2013.09.29

    Red state collapse on parade. Brookings County should secede and join Minnesota.

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