Last updated on 2014.12.09
- Senator Larry Tidemann, Chair
- Senator Phyllis Heineman
- Senator Jean Hunhoff
- Senator Blake Curd
- Senator Larry Lucas
- Representative Dan Dryden, Vice Chair
- Representative Melissa Magstadt
- Representative Justin Cronin
- Representative Mark Mickelson
- Representative Susan Wismer
These ten South Dakota legislators, the current members of the Government Operations and Audit Committee (GOAC), are responsible for a farcical travesty of legislative inquiry and public accountability. These ten legislators have foisted on South Dakotans the insult masquerading as a report fulfilling their duty to investigate the Governor's Office of Economic Development and South Dakota's troubled EB-5 visa investment program.
Lied to by former governor and now Senator-Elect Mike Rounds, bamboozled by lawbreaking EB-5 profiteer Joop Bollen, and spun by the shifting story of Attorney General Marty Jackley, these ten legislators have shrugged and endorsed the cowardly, sandy-headed fall-guy narrative that dead and defenseless Richard Benda was the source of all ills in the GOED/EB-5 scandal. GOAC essentially rewrote the campaign propaganda that the South Dakota Republican Party sent to tamp down concerns about EB-5 in October.
The report rubber-stamps the audits and reforms discussed last winter, before GOAC received its legislative charge to investigate GOED and EB-5. It accepts without challenge the Swiss-cheese stories told by Rounds and Bollen. The only new work products produced by GOAC itself are two pieces of legislation that would tighten conflict-of-interest restrictions on state employees and make those restrictions last for one year after an employee leaves the state payroll. Even in proposing those modest reforms (the sort of no-duh rules that we should be embarrassed that we don't already have), GOAC focuses solely on Benda's alleged crimes and completely ignores Bollen's conflict-of-interest violations that cost the state millions.
GOAC makes its stonewalling stupidity clearest on page 5 of its report. Making hay of Richard Benda's diversion of $550,000 from Future Fund Grant #1434 (a grant Mike Rounds signed for Northern Beef Packers, with Benda pressing, knowing that Benda was going to be involved with the beef plant when he left Pierre, which facts trouble GOAC not one whit), GOAC mentions that it asked Bollen about how that chunk of the grant got converted into Benda's hefty pay as NBP's EB-5 loan monitor.
When asked about the $550,000 loan monitoring fee collected by Richard Benda from NBP, Mr. Bollen stated that he had no specific knowledge of Richard Benda collecting the loan monitoring fee [GOAC final report, 2014.11.28, p. 5].
This reading of Bollen's comments is incorrect and inconsistent with GOAC's own bogus conclusions. In his arrogant and cynical written response to GOAC after the election (oh, did I mention conveniently delayed?), Bollen said he set up the loan monitor job for Benda [page 9]. Bollen said Benda worked for Bollen's EB-5 management company, SDRC Inc. [Question 15, p. 13]. When GOAC asked Bollen how SDRC Inc. compensated Benda, Bollen said "Mr. Benda was paid pursuant to the terms of a contract for loan monitoring the NBP project, which was required under the loan with NBP. The terms of the contract contain private business information" [Question 8, p. 12]. Bollen's response that he had "no specific knowledge" of "how and why... Benda [was] involved in collecting the loan monitoring fee" [Question 20, p. 14] was at best legalistic if not patently absurd: he created the loan monitor job, hired Benda, and knew the terms of the contract well enough to choose to hide them from GOAC.
Bollen knows exactly how and why Benda collected his hundreds of thousands of dollars. He hid that information, and GOAC went "Ro-de-do-de-do, we don't need to know!"
To top off their obtusity, Tidemann and friends ignore Bollen's dismissal of their whole Benda-as-fall-guy thesis. Bollen cites NBP lawyer Rory King's argument, floated to Bob Mercer a year ago, that the loan-monitoring fees were perfectly legitimate. Senator Tidemann, when you simultaneously cite a source to support your thesis then ignore that source's rebuttal of your thesis, you come out looking like monkeys.
I hate to include the Democrats on this committee, Rep. Susan Wismer and Senator Larry Lucas, in the monkey pile. Rep. Wismer did expose GOAC's stonewalling and bring the EB-5 issue back to life last summer. Senator Lucas brought forth most of the substantive questions about Benda, Bollen, Rounds, and other players in the EB-5 scam, but he also strangely and incorrectly declared Senator Tidemann's conduct of the GOAC hearings "fair and non-partisan." Senator Lucas says he's considering filing a minority report, although why he and Rep. Wismer haven't already written that report and demanded its inclusion on the record is beyond me.
But this shame falls on all ten members of the Government Operations and Audit Committee, on all of a Legislature that accepts Chairman Tidemann's conclusion that "no further action was necessary," and on all of South Dakota, for electing such gutless, incurious, and feckless legislators.
Update 06:15 CST: Senator Lucas tells AP that minority report will happen, along with a call for a special prosecutor and further GOAC investigation. But he also says "it’s our due diligence as state officials to make sure we have covered all our bases in the matter" and that "Right now I’d say we’re about on third base." Third base? I don't know what puritans Larry's been making out with, but in my backseat, GOAC hasn't even gotten to first.