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Lucas Would Outlaw 2009 SDRC Inc. Contract; Bollen 2008 Deal Already Illegal

Senator Larry Lucas (D-26/Pickstown) smells conflict of interest in the Mike Rounds–Joop Bollen relationship. Recall that Joop Bollen quit his state job running EB-5 investment for the Governor's Office of Economic Development on December 21, 2009, then signed a no-bid five-year contract with Rounds's GOED to run EB-5 investment for the state through his private company SDRC Inc. the next day.

Senator Lucas has proposed an amendment to state law on conflict of interest that would make such a swift revolving-door deal illegal. SDCL 5-18A-17 currently prohibits any "state officer or employee who approves, awards, or administers a contract involving the expenditure of public funds or the sale or lease of property" (like Joop Bollen, from 1994 to December 21, 2009) from having "an interest in a contract that is within the scope of the officer's or employee's official duties." Lucas would extend that prohibition to remain in effect for one year after the interested party leaves state employment. The Government Operations and Audit Committee will discuss this proposed amendment on Wednesday morning, September 24, as part of its discussion of the EB-5 program.

The GOED–SDRC Inc. contract came one day after Joop Bollen quit his state job. It thus did not violate the statute Senator Lucas suggests amending.

But remember: the state gave Bollen's SDRC Inc. one earlier no-bid contract. On January 15, 2008, Joop Bollen, in his state job as director of the South Dakota International Business Institute, signed a contract giving SDRC Inc., the company he incorporated just five days earlier, authority to manage EB-5 activities for the state. That contract, issued by a state employee to a private company that state employee owned, violated state conflict-of-interest law as written.

The Lucas amendment deserves discussion. But Bollen-SDRC Inc. contract of 2008 deserves prosecution.


  1. larry kurtz 2014.09.19

    A forensic audit of the Future Funds slush pool would open some eyes.

  2. 96Tears 2014.09.19

    This is smart. Good governance is the best politics, and if you see a problem, find a solid, fair solution. Larry Lucas should find more solutions to this mess created and nurtured by D. Daugaard and M. Rounds.

  3. Roger Cornelius 2014.09.19

    What are and would be would the consequences for breaking these laws?
    These are some of the reforms needed to curb corruption, but they have to have some sharp teeth.

  4. 96Tears 2014.09.19

    Democrats should take the bit and run with a strong reform package as the first move in an attempt to negotiate with Republican legislators to make sure these kinds of legal and ethical abuses do not happen again. They should put together model legislation to end abuse and to get South Dakota out of its worst in the nation status of Most Corrupt State Government.

  5. Roger Cornelius 2014.09.19

    96 Tears,
    From time to time I have been advocating just that kind of ethical reform, of course Sibson will insert here that we tried that IM10 a few years ago and it failed. That failure should not preempt us from demanding our legislators from trying again.
    The best place for reform to start is from voters that are sick and tired of what Republicans have been doing in Pierre for the past 40 years.
    Should the legislature ever take up reform, there has to be severe consequences for defrauding our government, our state government will not provide meaningful oversight of themselves, maybe it is time citizens demand it.

  6. rollin potter 2014.09.19

    96tears, who is the ghost writer for the Lucas amendment??
    AS the district 26 rep. and sen. he was a complete ZERO!!!!

  7. lesliengland 2014.09.19

    we shall see at the September 24 legislative committee meeting.

  8. 96Tears 2014.09.19

    Entering public service doesn't mean grab a plate and serve yourself from the public's resources. That's a winning message Lucas and others can use.

    Lucas is on the GOAC and I'm sure the writing for the pre-filed bill came out of LRC, so rollin, there should be no disputing the origin of the writing. It's going to be difficult to shepherd this through the GOAC hearing and the 2015 legislature without a bigger, more inclusive message that many reforms are far overdue.

    The meatloaf on legs we know as Jason Gant got to the Secretary of State's office because he allegedly led the effort to make state records open and more transparent. The AP and the media were part of that political showboat and the result was appallingly meager. Yet the press crowed about victory. Now we see they hardly scratched the surface.

    I'm assuming Daugaard will get re-elected along with the rest of the GOP clowns who clutter our State Capitol. They want any more discussion of EB-5 to end on Nov. 5th. They will point to their elections to vindicate their perversity. This is an opportunity.

    Democrats in the legislature will still have openings to push for a majority in 2016 and win big in 2018 if they play a smart, disciplined yet hard-hitting offense to clean up the illegal and unethical behavior in Pierre. They will be up against all the moneyed lobbyists and the GOP office holders. There will be all kinds of distractions in Pierre and the patsies at home. Some of their own caucus might be bought off or would use the chance to grind axes. The press will be watching for any weaknesses and will pick them apart when they get a chance.

    They should be inspired by the clarity and courage that Susan Wismer has demonstrated. Nobody expected the quiet accountant from Britton to speak to power, but she did so very effectively. If there is a road forward for Democrats, it's this one. There are many examples from the GOP administrations to show how the public trust got violated. They should tell the stories and offer clear, effective solutions ... and never stop reaching out to Republicans to join them in cleaning up the nation's most corrupt state government.

  9. Jane Smith 2014.09.21

    Yes, that self serving state employee who robbed the state of money, opportunity, at the same time transferring liabilities to the state, needs to be prosecuted big time.
    He made off min with $360,000/year. Special math for Grandpa Don-$30,000 in fees x 12 eb5 applicants per year. At min that all we've got...

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