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Noem Clouds Location of Family “Ranch”, Exaggerates Risk Posed by 1994 Estate Tax

Kevin Woster reviews Kristi Noem’s easily mocked Galloping Ghost of a Governor ad and finds she’s deceiving voters about the location of her family farm—er, “ranch”:

It features video of Noem on horseback — I assume that’s her favorite horse, Ice Man — galloping across gorgeous green grasslands, often with what appear to be rolling river breaks in the background.

…The timing of “our ranch was saved” and the beautiful visuals leave the impression that she was riding on the one that was saved. She wasn’t. I don’t know where she was, but it wasn’t on the Noem place near Castlewood.

I’ve been there. The Noems have an attractive, modern home on a fetching old farmstead with a nice, East-River-type pasture nearby. Good grass in that pasture when I was there for a profile on Noem late in 2010. But nothing there said “ranch” to me. She used to call it a farm, and sometimes a ranch, but lately has settled on ranch.

I guess it fits better with the image she wants to project these days.

What I can tell you for sure is there’s nothing around Noem’s place like the sweeping grasslands in the ad. I’d like to know where it was filmed. So I sent an email to Noem’s campaign staff. I received the same response that I got earlier when I sent the campaign an email asking who made the ad. None.

I’m beginning to think outreaches from me to the campaign this cycle will be underappreciated [Kevin Woster, “Hold on to Your Hat for a Wild Ride in Governor’s Race,” SDPB, 2022.08.04].

Team Noem will likely appreciate even less Woster’s reminder that Noem’s hoary old story that her family almost lost their farm because of estate tax is a bigger deception than her creative visuals:

The idea that the Noem family “nearly lost our livelihood,” as the ad says, after her father’s death is certainly disputable.

During her years in Congress, Noem used the tragedy as an example of how the inheritance tax could harm farm families and others. She has said on a number of occasions that the inheritance tax, which she preferred to call the “death tax,” threatened the survival of the Arnold-Noem family farming operation.

In truth, the main threat came through a failure to update her dad’s will.

A number of reporters in the state and beyond looked at that issue, discussing it with tax experts and estate-planning professionals. Their conclusion was that the tax posed an additional difficulty at a difficult time, but was hardly one that threatened the family operation.

One of the reporters who wrote about this issue is Christopher Vondracek. His story for Courthouse News Service, which was referred to me by SDPB reporter Seth Tupper, was perhaps the most thorough and understandable that I saw. And it formed the basis for my understanding of the issue.

When Ron Arnold died in 1994, he had an estate worth more than $2 million, primarily in land, livestock and grain supplies. But like most farmers, especially younger ones, he also had debt on most of that estate. And because he hadn’t updated his will, his family faced $169,000 in federal taxes, money that didn’t need to be owed to Uncle Sam.

Had the right update been made to Arnold’s will after 1981 changes to the law that provided surviving spouses with a tax exemption, the estate could have passed on to Arnold’s wife Corrine, without any tax liability.

Instead, the family did have to deal with that $169,000 in owed federal taxes. But it didn’t hurt that Arnold had a life-insurance package that paid his wife $1.2 million. So even with existing debt and the new tax burden, they had plenty of options that didn’t have to include selling land to pay off the taxes.

It certainly made things more complicated. And they had to work harder to get right with the federal government. But it’s unlikely the family livelihood was ever seriously jeopardized [Woster, 2022.08.05].

You can review the story of the Noem/Arnold family’s estate tax, life insurance windfall, and Ronald Arnold’s will in my December 2017 posts:

40 Comments

  1. brent r mcmillan 2022-08-05

    PLEASE GO TO; INEQUALITY.ORG , December 26,2017
    Rep Kristi Noem’s Defense of Her Estate Tax Deceptions: A Textbook Example of Political Evasion.

  2. mike from iowa 2022-08-05

    Noem Nothing gave a speech last week to some outfit or another where she repeated her tax story and told her audience it took the family 10 years to pay it off. Noem can’t seem to help lying over and over again, just like drumpf.

  3. larry kurtz 2022-08-05

    Bill Clinton was POTUS during this so the Arnolds had an easy scapegoat, right?

    But,

    Noem’s dive into the family operation led to posts agricultural boards – her first steps into politics. She served on the South Dakota Soybean Association board. In 1997, then-Sen. Tom Daschle nominated her to serve on the state board of the Farm Service Agency. That led to an appointment to the board from President Clinton. Noem isn’t sure how her name got to Daschle for the FSA appointment. It came when the board was being expanded from three members to five. Regardless, Noem was a Republican serving among Democrats. “I don’t know why or how she got on that board,” said Mike O’Connor, a former Democratic lawmaker who served as the executive director of the state FSA.

  4. O 2022-08-05

    Never let the facts get in the way of making a political point.

  5. jim 2022-08-05

    “the family did have to deal with that $169,000 in owed federal taxes. But it didn’t hurt that Arnold had a life-insurance package that paid his wife $1.2 million”

    Many of us didn’t inherit millions. Didn’t inherit anything. But we still had to pay taxes after the death of our parents. Income taxes. Ten or twenty percent.

    No grief refund or anything. I wish I had her problem.

  6. Arlo Blundt 2022-08-05

    Governor Noem occupies the Office of Governor but has not exhibited any talent for or interest in, actually governing. She’s been striving to become a Republican “national figure” since the day she was elected. The office of Governor holds no attraction for her. She is just passing through.

  7. RST Tribal Member 2022-08-05

    The Noem telling white lies, big lies any fib is getting her attention and is defining her person, profession and ambition. She is on the track to be something in the Republican Party in the coming future.

    Lying or misdirecting is a common trait among the inept inbred Republicans representing South Dakota. For instance, RINO Thune wants South Dakota voters to believe he supports them especially the vets. But his voting record of late is like he lives in Kentucky or at least his head is situation pretty far up the backside of the Senator from that state.

    Rounds is wondering around avoiding reporters and mics as he was soundly politically spanked by 45 when he went off script concerning the 2020 election.

    Dusty has proven to be the PUC rep in the US House always looking for pipe to put in the ground or meeting with people who want pipes in the ground. He will take the election again unless he slips up and upsets 45 as he skips to the voting booth.

    The part time public official full time campaigner lady governor is out along the Missouri flats trying to get that just right image of a hardworking free spirited women. I heard these kind of ladies were common in Deadwood back in the 1800s to the 1980s until the feds, without the help of the Bill and Mark, put them out of business. Back then the ‘soiled doves’ or ‘sportin’ women worked their trade with pride and lies kinda like what’s her name who is in Pierre or TX, or FL, or NV or wherever the next republican speaking engagement takes her has been doing.

    Goodness her campaign theme song should be Johnny Cash’s I’ve Been Everywhere!

  8. 96Tears 2022-08-05

    Note to Woster: What does it say about a person’s most basic character if she lies about her own father’s death just to make her look like some kind of victim and hero of her own story? How can that possibly be reasonable?

    Those of us who’ve lost parents we loved and respected can’t imagine how anyone could betray the memory of her father to produce a political prop based on lies. Yet, Noem used this lie to introduce herself to voters in her first congressional race against Rep. Stephanie Herseth Sandlin. Now, 12 years later, she’s spewing the same lies to get re-elected Governor in our state and nationally to run for president in 2024.

    Lying about her dad’s death for a cheap applause line is one heck of a first impression. The only good part of it is it explains the rest of her lies and her lifelong disregard for laws and ethics to a T.

  9. John 2022-08-05

    A SD newspaper had a clip of a 2 /12 year old who represented the 7th generation on a Meade County ranch that was homesteaded pre-statehood.
    Have not heard of that family or others similarly situated whining and crying about the federal estate tax.
    My family, similarly, established a Brown County farm, well before statehood and still operates it. No one complained about the federal estate tax.
    Again, it appears that Noem is operating from far right field, in the absence of any reliable evidence.

  10. grudznick 2022-08-05

    We should not make fun of anybody’s father passing away.

  11. larry kurtz 2022-08-05

    Good eye, 96: Munchausen by doxy….

  12. jakc 2022-08-05

    I always feel sorry for people who only seem to hsve inherited money from their parents. My inheritance couldn’t be taxed and I wouldn’t trade it for money

  13. O 2022-08-05

    Do away with the estate tax; tax all inheritances as income. Problems solved.

  14. grudznick 2022-08-05

    That’s why we need trusts here in South Dakota.

  15. Caroline 2022-08-05

    I have a wee bit of knowledge about FSA from the Daschle/Noem years. It was my understanding at the time that Daschle appointed her in an effort to appear bi- partisan. I had close acquaintances who attended meetings with her. It was quite apparent that she didn’t have a clue. The good thing was that she rarely opened her mouth.

  16. Caroline 2022-08-05

    October 24,2010 Larry Kurtz wrote an interesting article on the blog “Interested Party” about Noem and her FSA involvement.

  17. 96Tears 2022-08-05

    Caroline, you are exactly correct about Noem back when she sat on the FSA board. There were questions about her misuse of the credit card assigned to her while serving on that board. It falls in line with her other abuses of the state airplane, the harassment of Sherry Bren to give political favors to her daughter, the misuse and arrogance of the highway patrol during her presidential campaign ego trips, the half million dollar fence around the governor’s mansion, the exclusive TV studio for her presidential ego trip in the state capitol, the luxury rugs, the luxury sauna, etc. etc. etc. Noem is out of control.

    She’s a classic narcissist and sociopath. And she is lazy and easily distracted. A real sleaze bag and total fake. That’s on her good days.

    But why throw your own dad under the bus to create a cheap political applause line? That’s a whole new level of sick in the head.

  18. MaryD 2022-08-06

    I just pushed the invisible “like” button for 96 tears for listing all of Noem’s abuses to South Dakota. And, especially for making her dad and family look like a bunch of know-nothings and she had to take the reins to save the family farm. gag. I was totally disgusted the first time I heard her say that. Now she is exploiting her mother in the latest ad to gather votes. At least her mother does appear to be normal and doesn’t look like part of her knowledge lacking family.

  19. Whitless 2022-08-06

    For people who own enough assets to trigger federal estate tax, the purchase of life insurance is a common estate planning tactic to cover estate taxes. Noem’s father was wise to purchase a million plus dollar life insurance policy because less than 20% of the life insurance proceeds could have covered the federal estate tax. When Noem’s father died, South Dakota’s inheritance tax was still in existence. If her dad left assets, such as farmland, to anyone other than his wife, there also may have been state inheritance tax to pay. For example, if dad left several acres to Kristi, a then struggling college student, she or the family may have chosen to pay the state inheritance tax by taking out a loan. On the other hand, there should have been sufficient life insurance proceeds to also cover any state inheritance tax if mom was willing to give or loan life insurance proceeds for that purpose. Given Noem’s pattern of not letting facts get in the way of her apocryphal life story, it is likely that the actual truth about preserving the family farm is far different than her portrayal.

  20. leslie 2022-08-06

    “We” grdz?

    Us secret billionaires? $400 B now, is it?

  21. sx123 2022-08-06

    Rarely are there ranches east of the river. West river has ranches, east river has farms.

  22. larry kurtz 2022-08-06

    Thank you, Caroline.

    Yes, twenty two years ago there was still hope South Dakota Democrats wouldn’t shoot themselves in both feet then stumble off into the weeds and bleed to death but then that happened right after Kevin Weiland found found that darned gun and blew it all up.

  23. grudznick 2022-08-06

    Why do you fellows worry so much about where Ms. Noem rides her pony? I say, as long as it it outdoors, she should have at it. Better than if she rode those dumb ATV things that wreck the whole environment worse than any Borehole or other digging might.

  24. Donald Pay 2022-08-06

    Grudz, you know as well as I do that ranchers are pretty particular about what you call a ranch. They especially don’t want what elitists pay for “hobby ranches” affecting their property taxes. They also look down on people who plow up good grazing land to have it blow away. When I lived up in North Dakota for almost a year there were snirt (snow and dirt) blizzards, partly due to badly managed farms and partly due to badly managed coal mines. There are some grasslands and some proper ranchers on land east of the river. I don’t believe Noem is on such land, but good for the Arnold-Noem outfit if they have restored some land to native prairie.

  25. grudznick 2022-08-06

    Mr. Pay, Conservatives with Common Sense are pretty particular about whom you call conservatives. Please no longer refer to those in my state’s legislatures who are insaner than most as “conservatives.”

  26. Arlo Blundt 2022-08-06

    Grudz…you can’t wish the bloom off the rose…Steve Bannon, Roger Stone, the incredible Rudy, and General (has taken the fifth amendment over 200 times) Flynn all call themselves Conservatives. Lou Gromer and Lorin Biebert identify themselves as Conservatives as does the Gaetz fellow. Donald Trump has claimed to be a Conservative in the past though there is no evidence that he is a Conservative. He is demonstratively a Fascist.The gal from Georgia now says she’s a “Christian Nationalist”, whatever that might be.

  27. Jake 2022-08-06

    Noem’s family on the old home place (brothers I often wonder how they appreciate her including them in their lies and B.S.) sure did learn quickly how to “farm” the government to the tune of over 4 million dollars in just a short time. Profitable relief from that very government their sister is belittling and degrading with every mouthful of words she utters.
    And, on the subject Grudz, your self-anointed Conservatives? With Common Sense are always some of the first in line at the federal payout window with their hands out for the dollars sent by the “blue states” (liberal Democratic states ya know, grudz) who subsidize your CWCS at their biscuit and gravy con-fabs; where they ‘tsk tsk’ about how all those whining about needing healthcare, better wages and housing should just shut up and pull themselves up the hard way- the way that they did!

  28. Jake 2022-08-06

    Arlo, she gets her ‘Christian Nationalist’ lingo-not from using her brain, but by copycatting the u darling of the conservatives: the fascist, Nazi embracing leader of Hungary who is speaking to the rabid bunch of conservative Republicans at CPAC in Texas this weekend. Who would have ever thought conservative/Republicans would embrace someone like him?
    Dick Cheney and Liz would go to the North pole rather than sit in an audience in front of that Hitler-esque individual.
    By the way, does anyone here know the whereabouts of our governess this weekend? Is she and our Highway Patrol security force at the big GOP shindig in Texas? (she’s a hard b-tch dog to keep under the porch!)

  29. larry kurtz 2022-08-06

    I’m not familiar with the layout of Racota Valley Ranch but there are some beautiful nearby rolling meadows like in the video around Webster, Big Stone City and Gary, right? There used to be an annual music event in a glade near Strandburg that was downright gorgeous.

  30. larry kurtz 2022-08-06

    When I was East River for my mom’s funeral in 2013 I drove the gravel road that goes straight north past our old place all the way to Gary. There are people who argue Waubay is the real source of the Mississippi River.

  31. larry kurtz 2022-08-06

    FWIW: Woster is a great storyteller and the family did provide a photo of Ron Arnold in a black cowboy hat for his obituary so if he called his spread a ranch we’re just mean for saying he’s a liar.

  32. grudznick 2022-08-06

    My good friend Lar is right. He is often mostly right.

  33. YeaBut 2022-08-06

    Some added details to Larry’s comments.

    To see rolling hills in the Big Stone City area, you need to drive west about 20 miles to the Coteau des Prairie Hills which people in that area quite often refer to as the Summit or Sisseton Hills. This is where there is a great deal of pasture.

    These hills originate in SE ND and run through NE SD.

    According to Dr. Wendell Duffield, a geologist, a strong argument can be made that Mississippi’s origin is near Veblen, SD at the roots of the Little Minnesota River.

    The Little Minnesota River flows into Big Stone Lake. The outlet for Big Stone lake is the beginning of the Minnesota River.

    According to Duffield, the Minnesota River Valley is wider and deeper than the Mississippi River Valley before the two merge.

    Duffield is a Browns Valley, MN.

    Here’s the link to Duffield’s story:

    https://m.startribune.com/could-the-mississippi-river-actually-begin-in-south-dakota/387864512/

    The fiftieth anniversary of the first Boot Hill festival near Strandburg is this year.

    The Watertown PO recently ran a story about it.

    Here’s the link:

    https://www.thepublicopinion.com/story/entertainment/2022/06/12/boot-hill-festival-celebrates-50th-year-music-and-memories/7527658001/

  34. Elizabeth Z 2022-08-07

    Jake: Can we leave the misogyny under the porch too?

  35. larry kurtz 2022-08-07

    Thank you so much for that affirmation and update!

  36. Cory Allen Heidelberger Post author | 2022-08-07

    It would be nice if we could keep Kristi on the porch, or in her office, doing her job.

  37. Cory Allen Heidelberger Post author | 2022-08-07

    Grudz, every deception matters. As Woster points out, the talk of her family’s “ranch” is overlaid with imagery of land that is clearly not the Arnold/Noem farm in Hamlin County. Authenticity matters. If you’re going to talk about your home, show your home. Noem doesn’t do that in this ad; instead, she shows the imagery she has cooked up to make herself into something she is not.

  38. Denny 2022-08-07

    Well the $4.3 million in crop subsidies to Racota Ranch should have helped avoid, “nearly losing our livlihood.”

  39. Richard Schriever 2022-08-14

    grudz, if she claimed native heritage – or wore black-face – would that mean nada to you too? It’s a put on – eminence strut.

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