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Frequent Feeders: AIII/GEAR UP Dollars Bought Restaurant Meals Every Other Day

Stacy Phelps ate out a lot on GEAR UP’s dime. So suggest the exhibits attached to Attorney General Marty Jackley’s notice filed this week in State v. Phelps, one of three felony cases he’s prosecuting in the Mid-Central/GEAR UP scandal.

Consider Exhibit 2, which shows aggregate totals spent at dozens of restaurants and stores by Phelps using money from his American Indian Institute for Innovation, the corporate entity Phelps and Mid-Central business manager Scott Westerhuis appear to have set up to conceal their use of public dollars for personal use. Here’s that exhibit in edited one-page form:

AIII expenses (edited form), Exhibit 2, Notice of Intent to Introduce 404(b) and Res Gestae Evidence, State v. Phelps, Case #11CRI16-000102, filed 2016.06.27.
AIII expenses (edited form), Exhibit 2, Notice of Intent to Introduce 404(b) and Res Gestae Evidence, State v. Phelps, Case #11CRI16-000102, filed 2016.06.27 [click to embiggen!].
Squint at the maddeningly fine print showing just the restaurant expenses (left column, plus lighter pasted block at bottom right), and you’ll see $87,647.15 in dining expenses accumulated in 812 visits over four years (October 2011 through September 2015). Phelps spent $108 every other day taking people out to eat or ordering take-out for staff and GEAR UP students.

Even if we strike the four largest line-item expenses for what appear to be food for students at the GEAR UP summer program (Dave and Busters, Golden Corral, Little Caesar’s, and Subway), we are still have over $45,500 spent on 712 dinings out. That’s an average of $64 dollars spent on 49% of the days in the period covered by the listed expenses.

The expense summaries submitted to the court by A.G. Jackley do not indicate how many of those dining out on AIII/GEAR UP dollars were current or former state officials.


  1. daleb 2016-07-03

    Typical Jackley. Investigate and prosecute someone for something unrelated to the actual corruption or bigger crime, instead focusing on something small time like eating out too much. The fix is in Phelps will be acquitted.

    When the state actually wants to stick it to someone you will see them dramatically overcharge someone. You would have seen the throw about 20 felony counts and 50 misdemeanor counts of varying degrees.

  2. grudznick 2016-07-03

    It is only speculation, Mr. H, that this fellow was feeding lunches or breakfasts to the accounting staff at the Education Department. There is no proof or allegation that I have heard.

  3. Roger Elgersma 2016-07-03

    The Native kids lose and everyone is talking about taxpayer money.

  4. Mr Sol 2016-07-03

    Fogo de Chao – excellent taste Mr. Phelps!

  5. mose11 2016-07-03

    When will our attorney general prosecute no slap on the hands Marty get it done.Can any one tell me if the Dept of Education is being looked into why didnt they check this earlier who heads this dept.

  6. caheidelberger Post author | 2016-07-03

    Grudz, where have you heard such speculation?

    Roger, the proper use of the money should be our primary concern. But for those legislators and voters who may not be thinking about Indian kids, we have to get them interested in the story with hooks they understand, like diversion of their tax dollars.

    Mose, I wish I knew! We can only hope.

  7. mike from iowa 2016-07-03

    In this crime drama there are no Jackley allies or mentors to protect so these people are fair game.

    Prosecution for corruption might go way up the food chain and we can’t have that- imho.

  8. leslie 2016-07-03

    perhaps Bosworth is a similar prosecution too, to achieve some diversion from and seeming closure about the truth for jackley/daugaard to cover up the stench of fraud. two young attractive naïve up-and-comers, taking short cuts. who were their mentors?

    (punctuation machine generated)

  9. grudznick 2016-07-03

    It is only speculation, Mr. H, but it seems to make sense. Talley’s is on that list and obviously everybody would go there for breakfast but why does the list stop at the letter “T”.

    I see the Golden Buffalo Casino is on this list. I have heard they have steaks but I am surprised the kids from the program would want to go to a casino. Let us hope people were not letting little kids play the craps and 21s.

    It is, regardless, a very impressive list.

  10. caheidelberger Post author | 2016-07-03

    Not likely, Leslie. Jackley had plenty of other less expensive distractions available. Bosworth posed no threat on her own to the GOP establishment. Plus, prosecuting her simply affirmed a public position South Dakota’s top liberal blogger had taken. No net gain for GOP to balance out the cost.

  11. grudznick 2016-07-03

    Mr. H is right, Ms. leslie. Young Dr. Bos is very attractive indeed but that is now why she got in trouble. It was Mr. H who took her down. I don’t see how she relates at all to the excessive dining at fancy places here.

  12. Donald Pay 2016-07-03

    OK. I might think this is overdoing it, and students may have been cheated out of money that should have been going to them. However, I would suggest the possibility that we are seeing a difference in culture here. I worked for an Indian organization one summer. One of the things I noticed was that when board members or others working with us came to Rapid City, the organization would take people out for lunch or dinner to conduct business. I thought it was excessive. In my white way of thinking you could just do business in the office and have people go their merry way. I came to realize that feeding folks was part of the cultural norm among Native Americans.

  13. grudznick 2016-07-03

    I don’t think the money was to go to the kids, Mr. Pay, it was to run a program to teach them or help prepare them to be successful in college. They should have just handed out checks to the kids though.

    But that is a lot of feeding folks. A lot of feeding folks indeed. I wonder if Mr. Phelps can show how much he put in his belly vs. how much went into these Indian kids’ bellies or the bellies of other fatcat administrator types.

  14. mike from iowa 2016-07-04

    According to earlier released docs Phelps enjoyed many a dinner far away from the confines of South Dakota.

  15. Mark Winegar 2016-07-04

    $87,647.15 spent for food but not one cent for scholarships.

  16. mose11 2016-07-05

    So where is the secretary of Education on this.

  17. Jenny 2016-07-05

    Phelps and everyone else at Gear Up need to thank the South Dakota taxpayers for the gravy train. I guess it was fun for them while it lasted. Rounds, Melody Shoupp and Daugaard especially deserve extra thanks for the easy money and letting it go on for as long as it did.

  18. Lora Hubbel 2017-10-30

    disgusting…but not criminal. It should be criminal but they violated no statutes. South Dakota is one of a few states that has an “honor system” for Non-profits. This represents lazy policy at best and collusion at worst. Time to get rid of the RINO establishment…which includes plenty of Democrat “friends” .

  19. Cory Allen Heidelberger Post author | 2017-10-30

    Lora, thanks for researching! I agree that the meal spending outlined above represents more waste and corruption in the GEAR UP program. I agree that our “honor system”—our assumption that all South Dakotans are pure as the driven snow and thus don’t need to labor under regulations and supervision—leads to corruption.

    But let me quibble with your last sentence. I know it makes some Republicans on your side feel better to think they’re still fighting liberal Democrats, but I don’t see any “Democratic friends” helping this corruption along. Please name me members of the South Dakota Democratic power structure—no, not your Ledermans and Soholts and Rhodens who once upon a time were registered Dems or who don’t score highly enough on your CFL scorecards, but professing, practicing, right-now Democrats—whom you can implicate as playing a major role in the GEAR UP scandal. I’ve seen no such list. Absent such names, the unpleasant (for your side) fact remains that your #1 target, the #1 source of corruption in South Dakota, is the mainstream Republican party of Bill Janklow, Mike Rounds, Dennis Daugaard, and Marty Jackley. Those corrupt GOP mainstreamers have wrought this corruption with little if any help from politically active Democrats.

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