• Tag Archives state legislature
  • Rep. May, GOP Leaders Make Us Pay for Them to Watch Committee Hearings

    Why did at least ten legislators (Rep. Elizabeth May, Rep. Sue Peterson, Rep. Sam MartyRep. Kristin Conzet, Sen. Terri Haverly, Rep. Steve Livermont, Rep. Chip Campbell, Rep. Julie Frye-Mueller, Rep. Taffy Howard, and Rep. Nancy Rasmussen) who aren’t on the Government Operations and Audit Committee truck all the way out to Pierre Tuesday to watch GOAC’s GEAR UP hearing in person instead of just staying home and listening to the SDPB livestream?

    Because conservative Republican Rep. Elizabeth May got us taxpayers to pay for their trip:

    A new policy took effect last Monday for the 105 members of the Legislature.

    They now are allowed to claim travel expenses for trips to meetings of legislative committees, even though they aren’t members of the committees.

    The idea came from Rep. Elizabeth May, R-Kyle.

    …May said the Internet simulcasts from meetings are OK – but…

    “It’s just not the same as being there in person,” she said. “It makes a difference to be in person, to get the feel of the committee, and the narrative.”

    Liz, as she’s known, considers Mark and Brock “pretty reasonable people.” Her logic was simple.

    “We (state government) pay to go these national conferences, so we should have the funding for anybody to attend at the state level,” she said [Bob Mercer, “Legislature’s Leaders Say ‘Yes’ for Travel Expenses,” Black Hills Pioneer, 2017.09.02].

    Rep. May has things backwards. If anything, we shouldn’t be paying legislators to attend cushy conferences and corporate propaganda fests around the country. Citing those extravagant expenses to justify adding more extravagant perks for legislators epitomizes the entitlement mindset of our elitist Republican legislators.

    The GOAC GEAR UP hearing we paid Rep. May and friends to spectate was all about accountability in use of government dollars. Yet the new May spectator pay is another government handout to political elites with zero accountability. A legislator puts three hundred miles on her car driving to Pierre. She sits in a meeting room for a couple hours, or maybe just pokes her head in. She casts no vote, produces no documents, does no measurable work, but the state writes her a check for $126 for travel. If she leaves early enough and gets home late enough, she can claim $32 for three meals. And if the hearing starts early enough, maybe she even gets us to pay for her motel room in Pierre at the state rate of $70 for the night.

    As Rep. May admits, her new spectator pay is about getting a “feel”, a “narrative.” It’s theater tickets. Sure, the audio livestream doesn’t allow us to see the sweat trickling down Senator Stace Nelson’s neck as he deftly avoids the GOP establishment’s effort to pluck his thorny pursuit of corruption from their bloated side. But tough shiskey. Front-row seats and chats with sweaty colleagues after the hearing are a luxury. We spend tax dollars on SDPB for exactly this purpose, to expand government openness without breaking the bank. Asking for more than that, asking to be paid to drive and watch, is greedy and wasteful.

    Rep. May’s spectator travel reimbursement won swift approval from Speaker G. Mark Mickelson, Senate President Pro-Tem Brock Greenfield, and the Executive Board on Monday. Her request did not appear on the Executive Board agenda or among the meeting documents posted for the public prior to the meeting.

    South Dakota Legislature Executive Board, agenda, 2017.08.28, p. 1, retrieved 2017.09.03.
    South Dakota Legislature Executive Board, agenda, 2017.08.28, p. 1, retrieved 2017.09.03.
    South Dakota Legislature Executive Board, agenda, 2017.08.28, p. 2, retrieved 2017.09.03.
    South Dakota Legislature Executive Board, agenda, 2017.08.28, p. 2, retrieved 2017.09.03.

  • GOAC Members Sutton & Tapio Unsatisfied with State’s Responses to GEAR UP

    The SDGOP spin blog desperately wants you to believe that the state is responding to the GEAR UP/Mid-Central scandal with all due diligence and that anyone making claims to the contrary is only seeking to boost political standing or TV ratings. (If you haven’t been paying attention, the SDGOP spin blog means Republican Senator Stace Nelson and reporter Angela Kennecke.)

    We can predict that the SDGOP spin blog will so sniffle-piffle at Democratic Senator Billie Sutton, who sat through today’s Government Operations and Audit Committee hearing and came away unconvinced that the state has nothing more to answer for for the scandal it made possible in Platte:

    Sen. Billie Sutton
    Sen. Billie Sutton

    It is disturbing to confirm that some state officials had early awareness there were problems with the GEAR-UP program. Taxpayers deserve to know exactly who knew what when and who should be held accountable for each failure.

    I support the full use of this committee’s power to root out this collapse of management that resulted in the misuse of millions of taxpayer money and the tragic loss of life. We cannot fix problems if smokescreens prevent us from knowing what caused the problems in the first place.

    It has become clear that we must get to the bottom of this in order to move forward, fix the system, and prevent another tragedy. South Dakotans deserve better [Senator Billie Sutton, press release, 2017.08.29].

    Sutton’s colleague on GOAC, Republican Senator Neal Tapio, expresses similar dissatisfaction over what he’s heard about GEAR UP and Mid-Central:

    Sen. Neal Tapio

    The state of South Dakota’s position on the matching dollars/$5+million valuation of donated Microsoft software for the GearUp program, as indicated by Sec. Schopp, is “the US Department of Education has signed off on the valuation.”

    The US Department of Education signed off on the matching software value on a conditional basis. After the fire, and claims that it is not possible to prove usage, the USDOE advised the state that barring new information, they will accept the valuation.

    After a legislative audit, it was determined most of the software was never used. South Dakota officials appear to believe it isn’t within their scope of responsibility to notify the US Dept. of Education of the new information.

    I can not stand by and accept the position of the state. I believe withholding information to be fraud.

    I will be making a formal request of the Governor of South Dakota to notify the US Department of Education of a new valuation of the Microsoft software. Donated, yet never utilized and expired software licenses does not have value.

    To understand the position of the state, it might be best to ask this question.

    If I determine a mistake was made on my 2012 tax return that came out in my favor in the amount of $5 million, do I have a legal obligation to amend my tax returns with the proper Federal Authorities, in this case the IRS, to reflect this new information?

    I would hope everyone involved within state government would answer in the affirmative.

    Smokescreens, says Sutton. Fraud, says Tapio. Those are pretty stiff words from Senators from opposite sides of the aisle.

    Sure, Sutton is running for governor, and Tapio is rumored to be running for U.S. House. But with this much strong language coming this quickly after a hearing that the GOP establishment surely wishes would have put GEAR UP to bed, the SDGOP spin blog may have to update its position that GEAR UP/Mid-Central is just political posturing and ratings-seeking.

  • 105 Remote Sellers Pay SD $1.57M Sales Tax over 13 Months

    The Legislature’s Executive Board hears a report on Internet sales tax collected from out-of-state sellers tomorrow, just one day before the South Dakota Supreme Court hears arguments in the lawsuit over the 2016 legislation (Senate Bill 106) that authorized that tax.

    The Department of Revenue’s presentation to the E-Board includes the hotly contested claim that South Dakota loses $50 million each year in uncollected tax on online purchases. The presentation also says that in Fiscal Year 2017, our new Internet sales tax law allowed us to collect not quite 3% of that allegedly lost amount:

    SD Dept. Revenue, "South Dakota Legislation: SB 106 in Action," presentation to Legislative Executive Board, 2017.08.28.
    SD Dept. Revenue, “South Dakota Legislation: SB 106 in Action,” presentation to Legislative Executive Board, 2017.08.28.

    According to the Department of Revenue, that $1.57 million in sales tax ($1.12 for the state, $463K for municipalities) has come from 105 remote online sellers who have obtained active South Dakota sales tax licenses since the passage of 2016 SB 106.


  • Guest Column: Bernie Hunhoff Eulogizes Roger McKellips

    Roger McKellips, the last Democrat to lead a majority in the South Dakota Senate, died this week at the age of 94. The former Alcester banker, eight-term legislator, and 1978 Democratic nominee for governor is being buried today in his home town. One of McKellips’s colleagues, former Yankton legislator Bernie Hunhoff, offers this eulogy:

    Roger McKellips, 1923–2017
    Roger McKellips, 1923–2017

    The McKellips family of Alcester has always exemplified the best of South Dakota. I love the old story of when the family’s bank closed in the Great Depression and they lost everything, and so did a lot of their friends and customers who had money in that bank.

    But Roger’s dad never gave up. He worked day and night, and started selling insurance because there was more money in insurance than banking. We’ve told the story in South Dakota Magazine.

    Finally the McKellips family paid back everyone who had lost money in their bank. Roger was a teenager then but he must have been paying attention because that’s exactly what he was like when I got to know him at the state legislature a half-century later.

    Humility. Selflessness. Determination with patience. And a great devotion to community.

    Roger served in World War II and then returned to run the family bank, and devoted his life to Wilma and their beautiful family, to community and public service.

    I felt very blessed to get to know Roger and Wilma in 1993 when I first went to the state senate. Of course, Roger had been there for years and I was a rookie.

    The years 1993 and 1994 were fascinating in the State Capitol because, after a long spell of total Republican rule, the Democrats had pulled an upset in the 1992 election and took control of the State Senate, 19 to 16.

    Roger McKellips’ Democratic caucus was quite a mix. It looked a lot like South Dakota.

    Some of us were ideological young freshmen who wanted to change the state and change it now.

    Then there were those veteran lawmakers who had been around for a long time and who thought they’d been pretty abused by the Republican leadership. They wanted revenge, a pound of political flesh.

    We had six women among the 19 Democrats – strong women: Pam Nelson, Linda Stensland, Roberta Rasmussen, Rebecca Dunn, JoAnn Morford and
    Sharon Green.

    They felt it was long overdue to start talking about children and health care and schools and things that didn’t always get enough attention in those days.

    There were several Native American senators and they had some issues that they felt had been ignored for too long.

    Add to the mix a few liberal Republicans, Larry Gabriel’s Republican House majority, and the old cowboy Walter Dale Miller who was Lieutenant Governor, and you had quite a cast of characters.

    Walter Dale had been around forever as a legislator and lieutenant governor so he knew all the rules and he’d written many of them.

    Of course, he felt it was his job to help the Republican lawmakers and Governor George Mickelson.

    So there was Roger, caught in the middle of all that at age 70 as Senate Majority Leader. I’m sure he must have wondered many times why he wasn’t home with Wilma, or fishing with the grandkids.

    It started out very wild. An organization that was supposed to be non-partisan held a reception and had a drawing for door prizes provided by Republican elected officials.

    We were all there. Roger’s face got red as they kept awarding the prizes and he started to fidget around – and then he finally jumped to his feet and sought out the leader of the group, a man who might have been a foot taller and a 100 pounds heavier, and he gave him a tongue lashing about the meaning of non-partisanship and how they had just insulted the entire citizen legislature.

    And we freshmen learned right then — that’s why Roger was our leader. He was looking out for us!

    On another occasion, early in session a young legislator tried to pass a bill for a scholarship program and the old-hand Republicans were really blistering him for being frivolous.

    Roger finally got to his feet and gave an impassioned speech about how much we’d spent that year already on new buildings and bridges and such, and he said, “brick and mortar is nice but it’s not as important as the boys and girls of South Dakota.”

    He showed us how to have fun. He kept an all-purpose amendment in his desk drawer on the senate floor that proposed to close the law school in Vermillion and re-direct the $5 million in savings to (fill in the blank). When the loyal opposition would object to the cost of a program he liked, he’d sometimes rise to his feet and tell Walter Dale, “I have an amendment ….”

    I don’t know what he had against the law school. He must have had a skirmish with some lawyer at some point. But he always had that Johnny Carson grin when he did it.

    Looking back, I know the Republicans loved Roger almost as much as we did even though there were times when he’d fight — red-faced and passionate — with Harold Halverson and Jim Dunn and Lyndell Peterson, some of the old lions of the legislature — and you’d think they would never speak to each other again.

    But once the vote was taken and the matter settled, they might go and exchange a few words and share a grin and go on to the next bill, which they might even agree on. Who could stay mad at Roger McKellips for long?

    And if they did agree on a bill, Roger might say, “I commend Senator Halverson, my good friend from the great city of Milbank, for bringing this important matter to our attention ….”

    And then the next bill they might be back at it – passionate and miles apart. He taught us all to not take politics personally; take it one issue at a time, one vote at a time and live to fight another day.

    We had some long days and nights in those two years because Roger and his caucus had the votes to bring things to a halt if we didn’t like the direction. I think the Republicans thought they could wear old Roger down. But he enjoyed every minute of it.

    Roger and Walter Dale both knew the rules of the senate by memory. But for the first time in his legislative career, Roger had the votes to actually challenge the Walter Dale’s rulings over procedural matters — for example, the outcome of voice votes.

    So like an old football coach, Roger would choreograph the agenda and he’d tell us to be ready to challenge the chair. Be sure you’re paying attention and be ready to vote loud and clear, he’d say.

    Walter Dale would rule against him and Roger would challenge the chair and we’d holler out a big AYE to support our leader. Roger loved it every time he challenged and won, which was sometimes several times a day.

    We’d caucus long into the evenings and he never lost his spirit. We covered the clock on the last day — yes, we used to do that — and when we took the coat off the clock and finally adjourned a lot of good things had happened because Roger McKellips kept his rag-tag band of Democrats together and found common ground with George Mickelson the Republican leaders.

    Education, water development, landmark environmental legislation, economic development for small businesses — even a beginning farmer program was passed, Roger loved family farming in South Dakota.

    Sadly Governor Mickelson died weeks later in the plane crash and Roger retired from the legislature the next year. As far as I’m concerned, Pierre has never had a golden age like that since. But many of us who were there will always remember the lessons of life learned under Roger’s leadership.

    Have fun. Don’t be so serious. Love your family and friends, even when you might disagree. Love your community. Love South Dakota and this great country.

    Did anybody ever practice those principles any better than Roger McKellips? I ask you?

    How about if we put it to a voice vote? One last voice vote for Roger.

    All in favor of the motion that Roger McKellips remains a shining example for South Dakota say AYE!

    I’d bet even Walter Dale Miller and Harold Halverson are up there shouting AYE [link added; Bernie Hunhoff, edited text submitted to Dakota Free Press, 2017.08.26].

  • Schoenfish & Co: We Did Our Job Well, But Education Dept Maybe Didn’t

    Schoenfish & Company signNobody from accounting firm Schoenfish & Company accepted the invitation to testify before the Government Operations and Audit Committee next week about its auditing of the scandal-sunk Mid-Central Educational Cooperative. But someone in the Schoenfish office (probably not accountant and legislator Kyle Schoenfish, who has distinguished himself with a defensive reticence and an inability to write coherently) did compose a series of concise and, where necessary for its purposes, evasive responses to the 31 questions GOAC sent to Kyle’s dad and firm chief Randy Schoenfish on August 4. The auditors undercut the Department of Education’s claim of diligent oversight of Mid-Central financial activities. And for good measure, the auditors also tell GOAC to jump in a creek.

    Schoenfish & Company doesn’t tell us much new case-cracking information. Their response to GOAC tells us that “approximately eight different people” have worked on Mid-Central audits for the “approximately 20 years” that the firm reviewed Mid-Central’s finances. The last five audits Schoenfish & Company conducted of Mid-Central before ceding audit responsibility to the Department of Legislative Audit took from 145 hours on FY2010 to 172 hours on FY2014:

    • Fiscal Year 2010: 145 hours
    • FY2011: 149
    • FY2012: 152
    • FY2013: 147
    • FY2014: 172

    Schoenfish & Company notes that Mid-Central was one of “roughly 80 schools, cities, coopes, and other governmental entities around the state” that it has audited. The firm notes with pleasure that “even more governmental entities chose to hire the firm for 2017.”

    The firm reminds GOAC that it issued several adverse opinions to Mid-Central (Schoenfish & Company identified material weaknesses for eight years) and says that “more than just cash was reported as a concern.” The auditing firm says the responses from Mid-Central’s board members, director Dan Guericke, and business manager Scott Westerhuis were typical of responses from other agencies to audits. Apparently there were no “heated” meetings like the one described by Secretary of Education Melody Schopp with Mid-Central staff circa 2012 amidst discussions weaknesses in bookkeeping.

    If the Department of Education had concerns that could provoke a “heated” meeting with Mid-Central, one would think they might be interested in learning more from the auditors who were finding chronic material weaknesses in Mid-Central’s books. However, in its most noteworthy response, Schoenfish & Company says DOE called them once:

    The Department of Education had only one brief conversation with one member of our firm. As we recall, they only asked a couple of simple questions. They never expressed any concerns to us during the many years we performed the audits [Schoenfish & Company, response to GOAC, 2017.08.17, p. 2, Response #7].

    Here Schoenfish & Company makes it sound like the Department of Education didn’t want to let anyone know that it knew that something was amiss at Mid-Central. Bookmark that.

    GOAC asked Schoenfish & Company about the $900,000 gym Mid-Central business manager Scott Westerhuis built at his home with money he stole from GEAR UP and other federal grant moneys handled by Mid-Central. The firm says the gym “was discussed” and was “never acknowledged to be a GEAR UP asset by anyone we spoke to.”

    Schoenfish & Company explains that it asked the Department of Legislative Audit to take over auditing Mid-Central after the spectacular Westerhuis murder-arson-suicide in September 2015 because the investigation was too big for any private firm:

    [DLA] had better access to DCI, Forensics, Fraud Division and the Attorney General’s office. They looked at many of our documents and visited with us. Because of the media attention and various other expectations, the time they spent (not exactly known to us) would have been prohibitive to a private business with regular clients to serve [S&C to GOAC, 2017.08.17, p. 5, Response #23].

    Schoenfish & Company’s evasions include using professional standards to justify not telling us who specifically worked on the audits:

    We use a team approach, with approximately 8 auditors. Profession standards require all auditors under the firm to be competent and unbiased; therefore, an auditor’s individual involvement is immaterial to the scope of an audit as a whole. It is very rare that any one auditor in our firm would do more than twenty five percent of any audit [S&C to GOAC, 2017.08.17, p. 4, Response #19].

    Schoenfish & Company cites the AICPA Code of Professional Conduct to avoid a specific response to GOAC’s question about gifts auditors may have receive from Mid-Central, the DOE, or other state or federal officials. The firm parries questions about misused funds, illegal contracts, and criminal charges by citing pending court cases.

    Despite its reticence on several questions, Schoenfish & Company concludes with some unsolicited advice to GOAC on how to do its job:

    As explained to us by Tim Flannery, the GOAC has several basic purposes. One is to determine if some changes need to be made with any weaknesses with any department. Another is to suggest possible legislation to be brought before the House and Senate. In the future, perhaps the GOAC would better serve the citizens of South Dakota through a combined effort involving the Department of Legislative Audit and several firms that audit government entities in South Dakota in order to address potential weaknesses, legislation or other local government matters [S&C to GOAC, 2017.08.17, p. 7].

    Such advice from a citizen in the witness chair might seem audacious, but hey—isn’t telling the Legislature what to do one of our fundamental rights?

    Schoenfish & Company is sending no one to testify in person next week to avoid putting any individual face on its responses to this legislative inquiry. The firm has provided a corporate response, stating it met its professional obligations in auditing Mid-Central for around twenty years and has the vote of confidence of an increasing number of government customers. And for those of us trying to keep score, Schoenfish & Company has suggested that the Department of Education was not quite as concerned about financial problems at Mid-Central as the Secretary of Education has suggested.

  • I&R Task Force Approves Mostly Bad Reforms, Rejects More Time and Protection for Initiatives

    The Legislature’s interim task force on initiative and referendum met yesterday and, taking no further public input, approved nine of its twenty draft proposals for changing how South Dakota conducts direct democracy.

    Senator Reynold Nesiba lists the proposals that passed, “some of them in significantly amended form,” as Drafts 77, 81, 82, 83, 84, 96, 97, 99, and 100. As currently listed on the LRC website, those proposals would do the following:

    • 77: Take away the ability of petition sponsors to determine their petition size and font size and give that power to the Board of Elections.
    • 81: Take away the power of the majority to amend the state constitution and raise the threshold of passage to 55%.
    • 82: Take away the exemption of initiatives circulating prior to July 1, 2017, from the fiscal-note requirement.
    • 83: Take away linguistic accuracy and the default-No advantage referendum sponsors currently enjoy by changing the ballot to make voting “Yes” mean repeal and voting “No” mean keep a referred law in effect.
    • 84: Take away the arbitrary power of the Code Commission to resolve conflicts between approved ballot measures and instead resolve conflicts by enacting the measure that receives the most affirmative votes.
    • 96: Take away the option of submitting an initiative proposal for LRC review more than 30 months before the general election.
    • 97: Take away up to three months of petition circulation time by allowing LRC to withhold its review of initiative petitions received between December 1 and the adjournment of the regular Legislative Session at the end of March.
    • 99: Take away resources and convenience from ballot question sponsors by requiring the printing and distribution of tens of thousands of copies of the full text of each initiated measure and amendment (in return for the smaller and legally questionable convenience of not printing the full text on the petition).
    • 100: Take away the requirement that ballot question sponsors request a fiscal note and instead let the LRC director automatically produce the fiscal note if the LRC director can identify a fiscal impact from an initiative.

    The only proposal that clearly benefits voters is Draft #84, which puts the resolution of conflicting initiatives entirely in the voters’ hands.

    There is some debatable good in Draft #83, flipping the Yes/No effect of votes on referenda. When I campaigned to block by referendum the youth minimum wage and the Incumbent Protection Plan in 2016, some voters found it confusing that doing what we wanted—stopping the Legislature’s assaults on voters—meant voting No. If voters treat “refer” and “repeal” as synonyms, then it may sound more logical to say, “Support the referendum! Vote No!”

    While I understand proposer Will Mortenson’s logic, Draft #83 actually introduces linguistic inaccuracy into referendum law and onto the ballot. Saying “Vote ‘Yes’ to repeal the Act of the Legislature” incorrectly assumes the Act is valid and must be repealed when in fact the referendum process stops the law from taking effect. There is no law to repeal when voters go to the polls. Draft #83’s “No” language—”Vote ‘No’ to allow the Act of the Legislature to become law”—recognizes that fact. Draft #83 makes a “No” an affirmative act. For every voter this change may help, Draft #83 may confuse another voter. In 2016, voters seemed to have no problem translating their clear distaste for the Legislature’s attack on our minimum wage initiative and on voter rights into 70%+ No votes; there thus seems to be no pressing need to change this ballot language.

    Draft #100 removes a little bureaucracy for ballot sponsors but does nothing to give voters more information or power. Draft #82 provides a one-time change that may actually benefit the sponsors of the recreational marijuana initiative, who would love to present an LRC assessment showing their proposal pumping millions of dollars into South Dakota’s general fund.

    Drafts 77, 81, 96, 97, and 99 are on the whole anti-initiative measures meant to frustrate the ability of citizens to change their laws and constitution. The task force also shot down the two best improvements in the initiative process on their docket: giving sponsors more time to submit petitions (Senator Nesiba’s Draft #87) and protecting approved ballot measures from Legislative repeal (Chair Emily Wanless’s Draft #114).

    The idea of a citizen panel to review ballot measures has been assigned to a subcommittee for further review. The task force will meet one more time, in October, to review that review. A citizen panel could turn into another hindrance to the initiative process, but even if the task force gets that citizen panel concept right, it won’t be enough to reverse the overall negative results the interim task force on initiative and referendum has produced for people power.

  • Former Indian Education Director Campbell Could Elaborate on Schopp GEAR UP Response

    On her first day as Secretary of Education, Melody Schopp asked the director of the Office of Indian Education, LuAnn Werdel, to resign. Werdel unloaded with statements questioning the integrity of those managing the GEAR UP and College Access grants, then backed off from her criticisms the next day. The e-mails made public by the Government Operations and Audit Committee as part of Secretary Schopp’s written response to committee questions thus wakens the case for blaming Secretary Schopp for not acting on the concerns expressed by Werdel in January 2011.

    The timeline for serious concerns about misconduct at Mid-Central thus defaults back to 2012, which Schopp has previously admitted is when her department began tracking “incompetence” in Mid-Central’s financial record-keeping and offering the cooperative “technical support.”

    It apparently took the person Schopp chose to replace Werdel, Roger Campbell, to draw Schopp’s attention to GEAR UP:

    I hired Mr. Campbell in March 2011. The GEAR UP contract with mid Central was signed in March 2012, and GEAR UP became one of the Mr. Campbell’s responsibilities. Mr. Campbell first expressed concerns in spring 2012, one of which was that the business manager was also CFO for AIII.

    At the July 24, 2017, GOAC meeting, I referred to the fact that SD DOE staff had concerns going back to 2012, and I described the increased monitoring activities regarding GEAR UP in response to those concerns [Education Secretary Melody Schopp to GOAC, 2017.08.22, Response #38, pp. 5–6].

    Schopp refers with a surprising lack of detail to a heated meeting involving her, Campbell, other DOE staff, and principals at Mid-Central:

    I specifically recall one in-person meeting with Mr. Guericke, Mr. Westerhuis, Mr. Phelps, myself and SD DOE staff, including Mr. Campbell, which was very heated and included what I considered to be personal attacks on both sides. This back and forth was not only unproductive, but also odd, because Mr. Phelps had suggested Mr. Campbell as a potential candidate for the Indian Education Director position. I likewise felt this was negatively impacting the grant’s purpose [Schopp, 2017.08.22, p. 6].

    Schopp doesn’t put a time on this alarming meeting, but it must have taken place before March 10, 2013, the effective date of Campbell’s resignation from the OIE given in the resignation included in Schopp’s GOAC response. More importantly, Schopp gives no details about who said what. She vaguely mentions emotion and personal attacks but says nothing specific about what facts or policy matters might have provoked such outbursts. She explicitly ties nothing from that undated meeting to her otherwise meticulously timelined account of remedial actions her department began taking to check Mid-Central’s deficiencies in 2012 and 2013.

    Instead, in the next breath, she turns to Campbell’s resignation, says he did good work, and suggests Campbell saw no illegal activity at Mid-Central, so why should she?

    I believe Mr. Campbell had the department’s interests in mind, and his suggestions led to increased oversight and accountability for Mid Central. I have attached a copy of Mr. Campbell’s resignation letter, which does not reference any purported illegal activity [Schopp, 2017.08.22, p. 6].

    Notice that even as she talks him up, Schopp sets Campbell up as a possible firewall/fall guy between her and Mid-Central misconduct. Campbell was recommended for the job by Stacy Phelps, one of the GEAR UP principals now under indictment. GEAR UP was Mr. Campbell’s responsibility. When Campbell gave up that responsibility two years later, Campbell didn’t mention any illegal activity. If Pierre needs a back-up fall guy beyond Phelps, Guericke, and Hubers, Campbell may be the next in line.

    Of course, Campbell’s resignation letter is far from a detailed exit-interview document detailing all that of the institutional knowledge he feels he must pass on to his successor. After stating his intent to leave and addressing pay and leave details, he writes the following general epistle of gratitude and hope:

    It has been my privilege and honor to serve the department as the Director of the Office of Indian Education. I am grateful to have had this opportunity to help improve the educational outcomes of tribal students across the state. I feel that the department has a good foundation with the inclusion of department-wide strategies to address the achievement gap that exists between native and non-native students. It is my hope that the Department of Education will maintain this direction that identifies proven educational delivery that is data driven as well as inclusive of all entities, both public and tribal.

    Again I thank you for this opportunity and I wish the department and its hard working staff all the best as they move forward with your initiatives [Roger Campbell, letter to Melody Schopp, 2013.02.28, included in Schopp to GOAC, Appendix H, 2017.08.22].

    If Schopp can cite this single letter as evidence that she never heard anything about illegal activities at Mid-Central, we could cite this fuzzy prose as a subtle signal that DOE was all talk (“good foundation”) and no action (“opportunity to help improve” is not the same as “improve”) and that it needs a reminder of the principles it should be following (“data driven” and “inclusive of all entities, both public and tribal”).

    And notice that last pronoun: “your initiatives.” GEAR UP, other Indian education programs—they belong to you, Melody. At least that’s another way we could fit Campbell’s letter into the context of what we know and what we’re trying to learn about GEAR UP and Mid-Central.

    But let’s not speculate and over-interpolate our suspicions. Let’s get the facts straight from the horse’s mouth. Given what Schopp presents above, the next person GOAC invites to speak should be Roger Campbell. He has denied past press requests for comment, but the evidence and statements we have now appear to make him the most reliable witness we can ask about who knew what when about GEAR UP and Mid-Central. GOAC should now call Roger Campbell forward to answer the following questions:

    1. When did you first develop concerns about Mid-Central’s management of GEAR UP?
    2. What were those concerns?
    3. When did you share those concerns with other Department of Education staff?
    4. When did you share those concerns with Secretary Schopp?
    5. How did Secretary Schopp respond to your concerns about GEAR UP?
    6. Do you recall the “heated” meeting that Secretary Schopp describes involving herself, you, other DOE staff, and GEAR UP principals?
    7. If so, when and where did that “heated” meeting take place?
    8. Who was present for that “heated” meeting?
    9. Which if any of your concerns about GEAR UP were raised at that “heated” meeting?
    10. Who said what at that “heated” meeting?
    11. What if any specific statements at that meeting would you characterize as “heated”?
    12. What if anything do you feel prompted those “heated” statements?
    13. Did you share Secretary Schopp’s stated opinion that the “heated” meeting was “unproductive” and “odd”?
    14. Did the statements of Phelps, Guericke, and Westerhuis at this “heated” meeting heighten your concerns about the management of GEAR UP?
    15. What if any new opinions or actions did that “heated” meeting prompt you to adopt with respect to GEAR UP?
    16. While we’re at it, how did your wife Corrie Ann Campbell end up working as a facilitator for Mid-Central?

  • Nelson Requests Lengthy GOAC Meeting in Vermillion to Review GEAR UP Evidence

    In the John Wayne Toilet Paper department, Senator Stace Nelson tells his Republican colleague Senator Deb Peters that he will fulfill her request that he provide evidence on what he knows about the GEAR UP/Mid-Central scandal to their Government Operations and Audit Committee next week. However, it’s going to take staff, subpoenas, and several days in Vermillion:

    Sen. Stace Nelson
    Sen. Stace Nelson (R-19/Fulton)

    I will require at least 10 hours time on the GOAC schedule at the Vermillion map, and I will need the assistance in serving witness summons on at least 6 people.

    In that Senator Peter’s letter is an official letter to me as a SD Senator & member of the GOAC, I request the appropriate staffing and support to provide a thorough response for the record.

    Please make an impartial attorney available, two staff members to help prepare, and logistical support and approval for meeting with those persons to compile my official testimonial & documentary response.

    Since it is impossible to transfer the entirety of the research material available to Pierre, we will need to meet in Vermillion for several days to prepare and for the GOAC inquisition on what myself and others know about the corruption Senator Peters is attempting to distract from and run “interference” for [Senator Stace Nelson, e-mail to Department of Legislative Audit et al., 2017.08.23].

    The “Vermillion map” to which Senator Nelson refers is the wall-spanning project Marshall Damgaard’s political science students at USD created in spring 2016 to visualize all of the financial connections in the GEAR UP/Mid-Central scandal.

    Senator Nelson e-mailed this request this morning to Auditor General Marty Guindon, DLA audit manager Tim Flannery, Attorney General Marty Jackley, and Legislative Research Council exec Jason Hancock. Senator Nelson cc’s this e-mail to GOAC chair Peters, GOAC vice-chair Rep. Jean Hunhoff, Senate President Pro Tempore Brock Greenfield, his occasional colleagues in GOP rump rebellion Senator Lance Russell and Rep. Elizabeth May, and members of the press.

    Just to make clear he’s not gladly responding to the request for his testimony, Senator Nelson mans the guns and asks Pro-Tem Greenfield to kick Senator Peters off GOAC:

    Senator Greenfield, I renew my request for you to remove Senator Peters from the GOAC. With her efforts to illegally trade votes to have me removed for my January email asking questions of Rep. Schoenfish’s involvement in GOAC; her recent Op Ed claiming nothing is amiss (before we even got the answers back from preliminary witnesses?!); and now her abuse of her position as chairwoman serving letters on committee members who are not material witnesses in attempt to intimidate and distract from the corruption at hand; she has demonstrated (as astutely pointed out by Representative May) that Sen Peters is NOT running an impartial legislative investigation into this ugly public corruption scandal, but “running interference” for her patron benefactor’s administration.

    Please provide the requested assistance immediately [Nelson to DLA, 2017.08.23].

    One could argue that Senator Peters has simply requested that Senator Nelson present information, and that he could respectfully decline that request with no consequences, as did the four people GOAC invited to testify about GEAR UP next week. Instead, Senator Nelson is treating Senator Peters’s letter as a official request—note his use of the word serving in that last paragraph—and threatening to knock her out of her committee seat before she can knock him out of his Senate seat.

  • GOAC Considers Draft Bill to Block Brinda Kuhn-Style Grant Conflict of Interest

    Aw, Brinda Kuhn! By refusing to come talk to GOAC in Pierre next week, you’re missing your chance to talk about draft legislation that could very well be called “The Brinda Kuhn Grant-Writer Conflict of Interest Act”!

    Item #4 on the Government Operations and Audit Committee’s August 29–30 agenda is one draft bill, printed July 5, that represents GOAC’s sense of a proper legislative response to the monkeyshines revealed by reports on misconduct at the Mid-Central Educational Cooperative. Sections 1 through 4 expand public notice and documentation requirements for audits of school districts, grant sub-recipient monitoring, grant evaluations, and conflicts of interests. Section 5 goes specifically after the self-serving practices that allowed Brinda Kuhn to make over a million dollars off us taxpayers:

    No person who completes or assists with the development of a grant application or request for proposal, in either a paid or unpaid capacity, to receive state funds, including a pass-through grant, may participate in evaluating grant proposals, awarding a grant, drafting or entering into a grant agreement, evaluating grantee performance under a grant agreement, or authorizing payment under a grant agreement for that particular grant or any connected grant [Government Operations and Audit Committee, draft legislation, Section 5, printed 2017.07.05].

    The Department of Legislative Audit found that Brinda Kuhn did exactly that under her allegedly illegally issued contracts with Mid-Central:

    Brinda Kuhn
    Brinda Kuhn

    BC Kuhn Evaluation, LLC was a consulting firm that wrote the original grant applications for the GEAR UP, College Access, and Teacher Quality grants. In the applications, the firm included itself in each of these grants as a partner that would be providing advisory services. In the case of the GEAR UP grant, the firm also provided evaluation services which is a conflict of interest.

    We were informed by Director Guericke that BC Kuhn Evaluation, LLC wrote the original grant applications for the GEAR UP, College Access, and Teacher Quality grants for no charge. He stated that it is a customary practice in education for the grant writer to then write themselves into the grant, as a partner, to be compensated for services performed. This was the case for each of these three grants. We believe this type of arrangement introduces risk as it doesn’t allow for competition in the procurement of services that are provided by the grant writer [Department of Legislative Audit, “Special Review of Mid Central Educational Cooperative,” 2017.05.19, p. 12].

    Come on, Brinda Kuhn! Fly on out to Pierre and tell legislators why letting grant-writers write themselves a nice no-bid deal to participate in and evaluate grant programs.

    Related: Even if the Legislature bans Kuhn and others from writing and evaluating the same grant, Brinda Kuhn can still help other evaluators learn how to evaluate GEAR UP grants. Her February 2012 slideshow describes all sorts of important metrics that GEAR UP grant recipients should be able to show (e.g., percentage of GEAR UP students passing high school math classes, enrolling in college, understanding financial aid), measures that South Dakota’s GEAR UP program struggled to meet.

  • GOAC Asks Stace Nelson to Testify, Setting Trap to Remove Senator from Office?

    Could Caleb Finck replace Stace Nelson as District 19’s Senator in the 2018 Session? Maybe, if this letter from the Government Operations and Audit Committee to Senator Nelson is the trap it smells like.

    GOAC Peters Hunhoff to Nelson 20180818As a candidate and a sitting legislator, Stace Nelson has sounded the alarm over the GEAR UP/Mid-Central scandal and South Dakota corruption in general more loudly than anyone else in Pierre. Many of the written questions sent to invited witnesses Melody Schopp, Tamara Darnall, Randy Schoenfish, and Brinda Kuhn were composed by Senator Nelson. Unable to get regular people to come respond to those questions in person, GOAC chair Senator Deb Peters and and GOAC vice-chair Representative Jean Hunhoff are asking their Republican GOAC colleague Senator Nelson to take that empty witness seat. Peters and Hunhoff are asking Nelson to reveal “the sources of any information you have regarding the investigation of the GEAR UP program,” any evidence he has of criminal activity, and recommendations for legislation responding to what GOAC has learned about GEAR UP.

    Nelson and Peters went to war on Twitter last month after Peters skipped chairing the last GOAC hearing on GEAR UP in favor of going to Washington to testify in favor of state online sales taxes. This request could just be some snark-back from Peters, who insists that her GOP establishment is doing all that is necessary to address GEAR UP and other corruption, against Nelson’s persistent gadflyery.

    But the new president of the National Conference of State Legislatures may be ready to throw some weight around to get Stace Nelson out of her legislative hair once and for all. Consider South Dakota Codified Law 2-6-6:

    Any person who, being present before either house of the Legislature or any committee thereof authorized to summon witnesses, willfully refuses to be sworn or affirmed, or to answer any material and proper question, or to produce upon reasonable notice any material or proper books, papers, or documents in his possession or under his control, is guilty of a Class 2 misdemeanor [SDCL 2-6-6].

    The GOAC chair is asking a GOAC member to present himself before GOAC and answer material and proper questions. The GOAC chair is asking a GOAC member to produce “sources” of information, which could include papers and documents. The GOAC chair has given the GOAC member “reasonable notice,” a good week-plus, to prepare his responses and documents. If the GOAC member takes the witness chair and doesn’t produce, the GOAC member could face a Class 2 misdemeanor charge.

    But 30 days and $500 is small potatoes to what Peters and many in the South Dakota Republican Party might really want. Consider SDCL 2-6-7:

    The conviction of a member of the Legislature of any crime defined in § 2-6-5 or 2-6-6 involves as a consequence, in addition to the punishment prescribed therein, a forfeiture of his office and disqualifies him from ever thereafter holding any public office under this state [SDCL 2-6-7].

    If Senator Nelson fails to answer the above questions to Chairman Peters’s satisfaction, Chairman Peters may invoke SDCL 2-6-6 and SDCL 2-6-7 to disqualify Stace Nelson from his Senate seat and from any future elected office in South Dakota. Governor Daugaard would then be able to appoint a replacement. Governor Daugaard’s logical choice would not be Democrat Russell Graeff, the runner-up in the 2016 general election in District 19, but Republican Caleb Finck, the loyal young GOP establishment minion whom Nelson vanquished in the 2016 primary with some savage personal attacks.

    The South Dakota GOP establishment has never liked Nelson, in part because he makes so much noise about the corruption that their monolithic rule has fostered. At next week’s GOAC hearing, Senator Nelson should tread carefully to ensure the GOP establishment doesn’t use his aggressive anti-corruption rhetoric to judo-throw him right out of the Senate.