Billions in Gov. Noem's budget unsettled as time winds down on South Dakota legislative session

Joe Sneve
Sioux Falls Argus Leader
Chris Karr and Kristi Noem

A contingent of budget hawks are standing in the way of nearly a billion dollars’ worth of projects in Gov. Kristi Noem’s proposed budget as time for negotiations with a bitterly fractured Legislature runs out.

And that’s got lawmakers and the governor accusing one another of putting politics before governing.

It's also raising doubts about their ability to find compromise on a multi-billion-dollar general budget and potentially hundreds of millions of one-time spending projects before they wrap up this year’s lawmaking session next week.

“I’m concerned about us meeting that deadline,” said Sen. Reynold Nesiba, D-Sioux Falls, a member of the Legislature’s Joint Appropriations Committee, which stopped meeting in February as stark divisions between the Senate and House became clear. “Right now, Senate Appropriations are meeting upstairs. … It’s not clear to me what’s going on on the House side.”  

An influential minority of House Republicans that includes the GOP's eight appropriators on the chamber's budget-setting committee are equally suspect of their Senate counterparts, accusing them of not accepting the outcome of a fair and open Legislative process. 

More:Gov. Kristi Noem calls committee 'dysfunctional' before workforce housing bill rejected again

That's at least partly to blame on an unprecedented amount of revenues to the state fueled by federal stimulus that brought nearly $4 billion in special funding requests with them to South Dakota’s 97th winter lawmaking session.

But with four days  left on the Legislative calendar, talks between budget-setting committees in the House and Senate remain gridlocked, while about $950 million of the governor’s ambitions hang in the balance, according to an Argus Leader analysis of bill filings with the Legislative Research Council.

Among the special projects caught in the crossfire of a state House that’s been much more resistant to Noem’s budget requests than its counterpart at the Capitol, is $600 million for water and sewer infrastructure grants and $200 million for a workforce housing initiative. A $30 million cybersecurity campus in Sioux Falls and a $5 million shooting range in Rapid City are also in jeopardy after the House Appropriation Committee this week refused to give the projects their stamp of approval.

More:DSU's planned cyber campus in Sioux Falls hits snag as funding bill gutted in Legislature

The projects have support of the Senate and a majority in the House, but thus far have been unable to overcome the often fatal House Appropriations Committee.

And with a two-thirds requirement to pass one-time spending bills, about 25 likeminded representatives in the House have had the numbers to block spending initiatives they see as growing government, involving it in private industry beyond the norm in South Dakota or not an effective use of funds.

"Most of these bills are the governor's bills, and they just want to rubber stamp it,” said Rep. Chris Karr, the chairman of the House Appropriations Committee. "But is there somewhere in between that we can agree? That's what we're trying to figure out." 

While he and his fellow committee members contend they’re simply vetting projects and proposals and making the recommendations they see fit, the propensity to say no to appropriations that have support from so many others at the Capitol is ruffling feathers.

Noem called the committee “dysfunctional” Thursday during her weekly briefing with the news media. And Republicans and Democrats alike in the Senate who support the bulk of what’s in the governor’s budget characterize House appropriators as obstructionists unwilling to govern.

More:South Dakota's next budget will be $92 million more than Gov. Kristi Noem anticipated in budget address

“It gets very frustrating to know there are people who will say no to everything. Here’s an opportunity where we have money to do visionary things for South Dakota, to prop our state up for generations to come,” House Minority Leader Jamie Smith, D-Sioux Falls, said. “We’re not going to do that if we don’t figure it out.”

Karr said when it comes to workforce housing and some of the other one-time funding projects that were rejected by the committee — those initiatives still got floor debates anyway — the legislative process has been figured out. They failed, yet attempts to use procedural maneuvers to revive the workforce housing and other stalled initiatives the governor wants are ongoing, he said.

"We expressed concerns about how the dollars are being used," Karr said. "We are trying to provide oversight on the best use of taxpayer dollars."

That two committee members, Reps. Taffy Howard, R-Rapid City, and Steve Haugaard, R-Sioux Falls, are seeking statewide offices and have acrimonious history with the governor has the committee accused of playing politics.

"At no point did a member of the public or private industry oppose these bills, which makes it clear they are wanted and needed by South Dakotans," Sen. Casey Crabtree, R-Madiosn, said, specific to the workforce housing initiative and the planned cyber-security campus for Dakota State University. "The small group that opposes will need to decide if they represent the people of their district or if they are going to sacrifice these initiatives to help Haugaard's campaign against our governor."

Noem and Haugaard are set to face off in South Dakota's June primary.

Constitutionally, the Legislature has until Veto Day on March 28 to pass a budget through both chambers, though its been more than a decade since lawmakers needed the two-week break between regular session to iron out final details.

And the only time since statehood that a Legislature gaveled out of Veto Day without a budget was in 1927 when it took a veto, a Supreme Court case and a special session before lawmakers got a deal done that summer.

As tense as negotiations are 95 years later, few expect it to come to that this year. “We will have our budget and have it finished by the end of next week,” Assistant Senate Majority Leader Michael Diedrich, R-Rapid City, said.