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Lazy Noem Wastes $6M in Coronavirus Aid to Outsource Easy Grant Management Job

$6 million could hire 120 more teachers to help ease the strain on our overworked teachers amidst the pandemic. Instead, Governor Kristi Noem is spending $6 million of coronavirus relief cash to ease the strain on her own team to pay a handful of consultants hundreds of dollars an hour to manage her small-business relief handouts:

…state officials are rushing to spend the money by the end-of-the-year deadline.

They’ve set aside $400 million for grants to businesses, $40 million for nonprofits and $10 million for business startups. The maximum grant is $100,000.

Applications opened Tuesday. They’ll stay open 10 days, through Oct. 23. The state hired a global consulting company, Guidehouse, to manage the process (including additional grants to healthcare providers) and will pay the company up to $6 million. Fury said that money will also come from the CARES Act [Seth Tupper, “Race Is On to Dole Out $450 Million to South Dakota Businesses and Nonprofits,” SDPB, 2020.10.14].

Guidehouse, an international firm with three offices in South Dakota (old Navigant offices, I think, acquired in an October 2019 merger) has whipped up an online application website for businesses seeking these grants. They’ll review the apps and calculate the disbursals. And their consultants will get paid up to $390 an hour to do the work we hired Noem and the Executive Branch to do:

State of South Dakota, consulting contract with Guidehouse, signed 2020.10.09, p. 1.
State of South Dakota, consulting contract with Guidehouse, signed 2020.10.09, p. 1.
State of South Dakota, consulting contract with Guidehouse, signed 2020.10.09, p. 2.
State of South Dakota, consulting contract with Guidehouse, signed 2020.10.09, p. 2.

For perspective, the lowest person on the Guidehouse totem poll in this contract is getting the equivalent of $100K a year. The “Engagement Partner” (and that sounds like consultant-speak for the person who will do the least actual work) is getting the equivalent of $780K a year.

I find it hard to believe that there are not people already on staff in the state’s Bureau of Information Technology, Bureau of Finance and Management, Department of Labor and Regulation, and the Governor’s Office of Economic Development who could not do the same work on salaries we’re already paying that are far less than Guidehouse’s great dollop out of the coronavirus relief fund.

Review the parameters of the small business relief program that the Legislature rubber-stamped last week. It took me about a paragraph to explain it. It would take a programmer in BIT maybe an hour to whip up the online application form necessary to capture the required data from businesses. It would take me five minutes to load that data into a spreadsheet and calculate whether an applicant qualifies and how much each one gets. It would take DLR or BFM a day to print and mail the checks or transfer the cash electronically.

Heck, Governor Noem herself could probably oversee this project and do half the work, if she just skipped a few campaign rallies and opened her laptop.

This whole project could be done in house, quite possibly without any extra staff and just a smidge of overtime, leaving most of $6 million to go toward real coroanvirus relief. Instead, our hands-off absentee Governor is letting opportunistic consultants cash in on her laziness and divert coronavirus relief funds to pure corporate profit.

21 Comments

  1. Jason 2020-10-17

    The consultant-industrial complex is a powerful force in the neoliberal capitalist system. Self-proclaimed conservatives like Noem and Rounds show their true colors when they set-up these crony capitalist arrangements. Thanks for calling attention to this issue Cory.

  2. Donald Pay 2020-10-17

    Ridiculous wasting of money. The real reason consultants are used so liberally is the kickbacks accruing to the campaigns of the politicians. State employees don’t kick back money to political campaigns, but the big shots at these consulting companies do. It’s a way to funnel tax money to their political campaigns.

  3. John 2020-10-17

    The South Dakota legislature once again shows its irrelevance via its abject ignoring any oversight on the executive’s spending and cronyism.

  4. Buckobear 2020-10-17

    I imagine that members of the noname crime family will be working for the “consultants.”

  5. jerry 2020-10-17

    There is no South Dakota legislature, might as well have monkey’s tossing feces as they would get more done.

    GNOem corrupts even the feces. Fact is, we need the 6 million for healthcare providers.

    “SIOUX FALLS, S.D. (AP) — A surge of coronavirus cases in Wisconsin and the Dakotas is forcing a scramble for hospital beds and raising political tensions, as the Upper Midwest and Plains emerge as one of the nation’s most troubling hot spots.

    The three states now lead all others in new cases per capita, after months in which many politicians and residents rejected mask requirements while downplaying the risks of the disease that has now killed over 210,000 Americans.

    “It’s an emotional roller coaster,” said Melissa Resch, a nurse at Wisconsin’s Aspirus Wausau Hospital, which is working to add beds and reassign staff to keep up with a rising caseload of virus patients, many gravely ill.” https://apnews.com/article/virus-outbreak-north-dakota-wisconsin-archive-9d53f66db25f04bd9cdc7b6142e950d8

    The Rapid City Journal has an excellent piece on this regarding Wessington Springs and the plight of the sick and dying there. I guess the “legislature” is too damn busy trying to come up with another potty bill to care.

  6. grudznick 2020-10-17

    Indeed, Mr. H. It is known that the BIT can whip up these kind of blogging and web pages in their sleep, so why did the BIT not do this one? However, grudznick must call out your French math on the $50 per hour underlings. You assume the underling pockets that much, nearly $200,000 a year. That is French math. The underling pockets a small fraction of that amount. The fatcat administrators suck off $30 of the $50 every hour, suspects grudznick.

  7. grudznick 2020-10-17

    What if, Mr. H, you did it for $1,000,000 in a few days, as you propose, and then the extra $5,000,000 goes to the top levels of the SLIT (seven indisputable levels of teachers) but only maybe the top 2 levels. We can all agree the really good teachers need more money. You need to email the Governor with your proposal right away. Or did you already?

  8. Curt 2020-10-17

    I missed the “French math” which Grudz “calls out”. The original post references those lowest paid on the ladder receiving “the equivalent of $100,000 per year” – not the $200K Grudz claims. Not sure whether it’s remedial Math or Reading he should seek, but he clearly needs help.

  9. Cory Allen Heidelberger Post author | 2020-10-17

    I’d gladly take on the entire project for $1M. I’d do the job for $500K and give the rest to the best person who runs to replace Noem in 2022.

  10. Mike Livingston 2020-10-17

    I cannot wait for the day when the great pretender in the darkhouse is kicked to the curb and smug butt kissers in the republicant senate are soundly relegated to the minority. The fake righteous indignation turns to hand-wringing, scapegoating, and begging for relevancy.

    Missy Kissy no m will have to reckon with having her dreams of grandeur shattered, and being confronted with her utter failure to provide leadership at a time when it is so desperately needed.

    Mismanagement of funds intended for pandemic relief should be a crime and grounds for a recall based on incompetence.

  11. Donald Pay 2020-10-17

    Mike Livingston points to recalling officials in South Dakota. You can recall certain local officials, but that option is not available for state officials in South Dakota. Unfortunately you are stuck with Covid Kristi for the next two years unless her irresponsibility catches up to her and she dies from the virus.

    The recall is a fairly blunt instrument, even if successful. It’s extremely difficult, as we found out in Wisconsin when we sought to oust Scott Walker.

    The best route to check an executive is to win a house or two of the Legislature.

  12. grudznick 2020-10-17

    Mr. H, have you informed Governor Noem of your kind offer, and would you hire poor grudznick at the $50 an hour level to do your bidding? I would be a great minion at $75 per hour, actually.

  13. Cory Allen Heidelberger Post author | 2020-10-17

    $6M—I wonder if Noem even knows this contract has been issued. I wonder if she will step out and explain why she thinks this contract with Guidehouse is a good use of $6M in coronavirus relief money.

    But I suppose I shouldn’t freak out: Noem can pay for these consultants out of the interest she made by socking CFR money away in the bank instead of helping people in need right away.

  14. Cory Allen Heidelberger Post author | 2020-10-17

    Grudz, would happily pay a team what they are worth, for the value they add to the project.

    Suppose applications for these grants equals the participation we say in the federal Paycheck Protection Program. 22,507 SD orgs received PPP cash earlier this year (O! the constant socialism keeping us afloat!). If that many businesses apply for this round of aid, we’ll be checking 22,500 applications.

    The justification for hiring consultants to do this work may be that no state office has the bandwidth to review that many applications in the time allotted… but I wonder just how many people Guidehouse will deploy for this task and how much time they will spend checking each application. It seems we’d have better oversight if we brought this job in-house.

  15. Debbo 2020-10-17

    I’m wondering when I’ll get over my shock and grief at the number of people lacking morals, compassion, sound reasoning skills and basic human decency? It appears to be a fraction of the population, but 25%+/-, is a lot more than I would have guessed 4 years ago. A LOT MORE.

    They seem to all be members of the GOP and the worst of them are in positions of leadership. Thankfully the majority appears to be feeling grief, anger and unyielding determination to rid our beautiful country of this ugly scourge.

    Holding fiercely to Hope. 🦋 🦋 🦋

  16. Mike Livingston 2020-10-17

    Seventeen days until election day and the pandering is reaching a dizzying crescendo as the goppp is beginning to feel the cracks in their foundation, Ben Sasse has a come to Jesus moment after four years of being an obedient lapdog, then lo and behold, Moscow Mitch and Lindsey trump are ready to come to table for pandemic relief.

    Next thing ya know McSally and all the other endangered republicants will be sprinting to put distance between themselves and toxic trump.

    What? A guy can dream can’t he?

  17. Jenny 2020-10-17

    Donald is exactly right. Noem seems to make odd decisions but this one is just following the money. She will get a nice return from Guidehouse when she runs for reelection
    She could just set mandatory OT for for her IT staff and they would get it done for a lot less money.

  18. grudznick 2020-10-17

    Ms. Jenny is righter than right. A little mandatory overtime for the IT people might just be what it takes to whip them into shape.

  19. Donald Pay 2020-10-18

    Deb Rogers researched the money churn between state government, the Black Hills water development district and consultants during the 1980s. It was quite the lucretive enterprise for a few folks, some of whom later became Republican politicians and agency heads. The research led to Lawrence and Meade counties exiting the water district. That and reforms by the Mickelson administration in how state money was allocated for water projects cleaned up the process a bit.

  20. Jake 2020-10-19

    This shows how exactly, that meritocracy’s are installed and South Dakota is so prime and ripe for. She dallied around holding this money in the bank drawing interest and now has to hurry the process up to get it spent before the deadline in December. Any Republicans reading this should wonder how many times that 6 million would turn over if spent on people in this state.

  21. Dc 2020-10-29

    Hearsay has it the Guide house grant rules leave something to be desired! Only $6 million, get what pay for?? They say submit grants, as rules are in flux!!

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