This interview originally aired on "In the Moment" on SDPB Radio.
South Dakota Gov. Kristi Noem may be on her way to Washington, but she still has priorities for South Dakota's next session.
Our Dakota Political Junkies look at last week's budget address, next year's session and the legacy Noem will leave behind.
Seth Tupper is editor-in-chief of South Dakota Searchlight.
Brad "Murdoc" Jurgensen is co-host of the Dakota Town Hall podcast.
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The following transcript was auto-generated and edited for clarity.
Lori Walsh:
Let's start with some of the priorities that we heard Governor Kristi Noem lay out in her state budget address, which we believe, at this point, may be her final state budget address to South Dakota.
Seth, what stood out for you in that address, in that conversation she had with lawmakers?
Seth Tupper:
Well, just the fact that with sales taxes being less than projected, sales tax collections, which she didn't really dwell on, but we learned from other sources before the speech really, as she described it, some tough choices had to be made.
And what really stood out to me was what choices were made. She's proposing tens of millions of dollars in cuts to several different state agencies. Department of Social Services and Department of Human Services seem to be the most hardest hit, but several other places as well, including SDPB as you're well aware.
Lori Walsh:
You can say it, we're covering the story. You can say it. Yes. That would be a pretty hard hit to SDPB. We're aware.
Seth Tupper:
A very hard hit. And so choosing to cut in some areas, but then at the same time announcing she wants to spend— and I should say 1.25% increase for education and state employees and health care providers, which is less than inflation. But then other areas she wants to do new spending. She wants to give $4 million to start education savings accounts to help kids go to private school or alternative schools or homeschooling. And she wants to continue to fund a prison with $180 million to continue building up that fund.
So I think that's going to be a major thing during the session is, okay, if we're dealing with a limited pot of money, which is a new situation, a different situation from the last few years when we had tons of extra federal cash and surpluses from the stimulus funds and pandemic relief and that kind of thing, if we're dealing with a limited pot of money, it's all about choices and are these the right choices that we want to make as a state?
Lori Walsh:
Seth, what's the power of saying we're going to fund that prison up front versus spreading it out over several years? Why is that so important to her fiscally?
Seth Tupper:
Well, yeah, and this is really interesting because obviously it's just like if you're going to buy a house, you can finance it and you can pay 5% interest on a loan for 30 years and you end up paying a lot of interest over those 30 years. It'd be the same thing with the prison times 20 or whatever with a project that's going to be $800 million. So you save a ton of interest over the course of if you had to bond for that or borrow the money.
But at the same time, we always hear our state leaders brag about our AAA bond rating. And well, what's that for? It's to save money when you borrow money. If you never borrow money, I'm not sure what the benefit of the AAA bond rating is. That's supposed to be the benefit of it.
So I wonder, and I assume maybe there'll be some argument this session about, gosh, we've already put away a huge chunk of the money for that prison. Maybe you could borrow the rest of it and with your AAA bond rating, have a great interest rate and avoid some of the cuts this session that you would have to make if you just took that whole 180 million and dumped it into the fund right now.
Lori Walsh:
Yeah. All right, so we're going to talk about education savings accounts here in a minute and property taxes or taxes in general, but Murdoc, what stood out to you, before we dig deeper into some of those topics, from the budget address?
Brad "Murdoc" Jurgensen:
The public broadcasting cut, that was the theatrical move of the budget, I guess. And it's maybe inside baseball because all of us in the media talk about the media things a little, but to me, it's school vouchers as the headline. And then the sub headline is, "And oh yeah, public broadcasting." It was just so identifiably unique out of the whole budget to me.
Lori Walsh:
And did you see a plan for what public broadcasting does and what those kind of cuts would actually be eliminating? There wasn't a lot of intention to it other than she said we need to come down to a national average, which she identified. So in other words, we're paying too much for this. We could be doing less. But beyond that, have you seen any plan?
Brad "Murdoc" Jurgensen:
No.
Lori Walsh:
For what happens next?
Brad "Murdoc" Jurgensen:
No, I mean it was headline-driven and it worked.
Lori Walsh:
We're talking about it.
Brad "Murdoc" Jurgensen:
That makes sense, right? Does that make sense?
Lori Walsh:
Yeah. We're talking about it. Seth, did that stand out to you at all when you heard that? Were you surprised?
Seth Tupper:
I was not surprised because I had gotten some tips about it, obviously, that maybe this was coming. So I didn't know. We had heard, as I'm sure a lot of people in our industry had that maybe this proposed cut was coming. When President-elect Trump announced that he had picked Governor Noem to be his Homeland Security Secretary, I did wonder, okay, is this going to take her focus off picking budget fights and will she just let things be and move on?
So I was a little surprised that she still decided, you know what? I'm going to pick a few fights in the budget here on my way out the door with only two months, probably, left in office. I was surprised at that, but on the other hand expected it as well.
Lori Walsh:
Did you hear any reportable reasons for it?
Seth Tupper:
For the SDPB cut specifically? No. Full disclosure, people who are listening may not know, I used to work at SDPB. And the governor has made past statements where she has accused both NPR, SDPB and PBS of what she thinks is leaning left. And so I have to assume that she has some ideological motivations for that. She didn't say that in her speech and she hasn't said really anything that I've seen since then. But those past statements by her are out there.
Lori Walsh:
Yeah. Murdoc, did you think that was a political statement?
Brad "Murdoc" Jurgensen:
"Where in the World is Carmen Sandiego?" is such a hotbed of liberalism? It follows the national trend. You got to throw a bone to the Trumpy meat, I guess, is the oversimplification of it, but it seems like public broadcasting across the board is going to be one of them things.
Lori Walsh:
Well, we will talk a lot more on this show, obviously, as we cover the story about what that cut would mean for public broadcasting. You'll be hearing that on Thursday and Friday. But I want to return to the education savings account, Seth, and tell me a little bit again about the plan to fund those beyond SDPB.
Let's get to the meat of what those ESAs would do and where the money would come from, and would they have the result of benefiting education or undercutting public education? What are you hearing?
Seth Tupper:
To underline something with Governor Noem. We don't know a ton about it because unlike past governors who maybe would've put out some embargoed information before the budget speech and maybe had a press conference after the budget speech and answered questions about it. All we know is what she said during the speech and what it says in her budget documents. So we don't have a ton of information, but what we do know is that she's proposing $4 million.
Lori Walsh:
For how much?
Seth Tupper:
$4 million for the program in total for education savings accounts. And about $3,000 per student for what apparently you'd have to be lower-income to qualify, but those details are fuzzy as far as I can tell. And families could use that money to help send their kids to private school or to put them in an alternative education setting like homeschooling or a micro school or whatever.
And so she's claiming that this is school choice and this is something that people want and people should have the freedom to send their kids to the place where it's best for them.
And she's claiming that this does not eat into public education funds. That argument is pretty tough to swallow, I think for anybody who thinks about it. If you've got money labeled as education and you're moving $4 million of it over here, it's pretty hard to say that's not coming out of public education funding, especially when you're proposing only a 1.25% increase in funding for public education in the coming year.
So you have folks on one side of the argument who want what they call school choice and want this kind of arrangement who say, "This is about freedom, this is about educating our kids the way we want."
You have people on the other side of the argument saying, "This undercuts public schools and undercuts public education funding and it roads away at that foundation."
Brad "Murdoc" Jurgensen:
There's the other side of that argument too, where there's legislative appetite to take that $4 million and turn it into $35 million. And so that's not a set-in-stone number right now either. There's some legislative appetite to want to make that 10 times bigger.
Lori Walsh:
And to be clear, South Dakotans do have the freedom to homeschool their kids.
Brad "Murdoc" Jurgensen:
Yes.
Lori Walsh:
There isn't a stipend for it. This is not a policy change saying you can homeschool or unschool if you choose because those laws are set pretty freely. People have a lot of options. And there are a lot of scholarships, including funded by tax rebate for private schools and faith-based schools, Catholic schools.
So those options are there, but this would be a way to financially support people in getting curriculum and finding ways to get their kids. So it's attaching a dollar sign to it. Do I understand that correctly?
Brad "Murdoc" Jurgensen:
That's what I take from it.
Seth Tupper:
Yeah, exactly.
Brad "Murdoc" Jurgensen:
And then where the financing gets a little more confusing is so there's X amount of kids then not in the public schooling, and then therefore their funding gets reduced.
And while we're having that conversation, don't forget there's this whole other property tax.
Lori Walsh:
Yeah, let's pivot to that because the property tax also would impact education funding. How so, Murdoc?
Brad "Murdoc" Jurgensen:
I guess we're jumping a lot of topics, but there's a new property tax plan out there put out by Representative Venhuizen and Randy, is it Randy Deibert from the Senate? Okay. Seth is so good at this. He'll correct us if I'm wrong here, but sales tax goes to 5%.
Lori Walsh:
He'll correct you if you're wrong.
Brad "Murdoc" Jurgensen:
Yes, that's what I mean. Sorry.
Lori Walsh:
Who's this us?
Brad "Murdoc" Jurgensen:
Yeah. What's this us nonsense? Seth, you've been used to correcting me. So sales tax would go to 5% that would generate 200 and is it 80 million? That would then offset some property tax increases over time.
Lori Walsh:
Okay. Seth, property tax is really important to Representative Tony Venhuizen as well. So help us understand, you just reported on this, the nuances of the property tax legislation, which we're seeing really define the early days of session already.
Seth Tupper:
Well, this is so fascinating because I've been really interested in this over the past few sessions because in the past few sessions, legislators have been so fixated on sales taxes. In part because Governor Noem and her last re-election campaign proposed eliminating the sales tax on groceries. And we all know that led us into this multi-year fight where the legislature rejected that plan and instead reduced the sales tax temporarily from 4.5% to 4.2% at the state level. And then we voted on "should we get rid of sales tax on groceries?" and voters rejected that. And here we are after all those years.
But meanwhile, the thing that I always hear from people and that legislators say they hear from people and that you see legislators run on is property taxes.
Brad "Murdoc" Jurgensen:
Tried and true.
Seth Tupper:
And yet they haven't really ever done anything about property taxes for the last several years. So there seems to be a growing feeling. And this was Tony Venhuizen said this when he announced his intent to do this bill the other day that, "This is the year finally to do something about this." So it just come to a head apparently.
It is fascinating from that regard. I think there were 14 incumbents who lost. There were various reasons for that, but one of the reasons was a lot of people ran on reducing property taxes. I saw billboards about it out here in Rapid City. Some candidates made that essential part of their campaign.
So there's a lot of political will to get something done, but what fascinates me is the batting around of the sales tax, just all the stuff we've been through the last few years. But in 2016, the sales tax was 4%. The state raised it to 4.5% supposedly to pay teachers. Teachers now are 49th in the nation in average pay. And then we came back in 2022, right?
Brad "Murdoc" Jurgensen:
2022. Yep.
Seth Tupper:
Lowered it to 4.2%, and now we're talking about raising it to 5%.
Brad "Murdoc" Jurgensen:
Imagine that phrase. Imagine walking into the legislative body and peer and saying, "Guys, 5%." You'd have gotten tarred and feathered in 2016.
Seth Tupper:
Yeah.
Brad "Murdoc" Jurgensen:
You might get tarred and feathered still in 2025.
Seth Tupper:
Yeah. And I think for schools, and there were some comments about this from the school lobby folks who say what you will about property taxes, it's pretty stable. It's either going to stay pretty stable or go up slightly, maybe not as much as they would like their property tax revenues. But I think some of the school folks are a little nervous about being more dependent on a sales tax if they're going to change sales tax policy every two years and it's going to be unpredictable.
Lori Walsh:
Right. How does this impact the conversation about the sunset of the sales tax reduction, Seth?
Seth Tupper:
Well, this proposal would essentially just shove that all aside and raise the tax to 5%. So that is still out there.
When they lowered it to 4.2, they set it to sunset in 2027. So if they do nothing, the tax will go back up to 4.5% in a few years. So it's just a crazy complicated, the numbers going all over the place in the last few years.
Lori Walsh:
Right. And who benefits and who doesn't? That's always the, only homeowners will benefit from a property tax reduction. People who are food insecure benefit from a food tax reduction. But many wealthy people who are capable of paying a food tax, they're going to get reduced too.
So this is all also about who wins and who loses in taxes, Murdoc. And I'm curious to know what you guys think about who has the political capital to get it done and are there consequences to it? Because this is super complicated and we saw what happened in the primaries, Murdoc. And there were consequences for the pipeline legislation, and there were consequences for not dealing with property taxes. So this is politically important as well.
Brad "Murdoc" Jurgensen:
My answer is no one has the capital. And are there consequences? This is the choppiest sea legislators ever had coming into Pierre in the history and maybe since the territorial legislature.
Lori Walsh:
How come?
Brad "Murdoc" Jurgensen:
There are a lot of people who have never done this before. There are a lot of candidates that won on the campaign of fire and brimstone, and we're going to bring it back to the good old days and the establishment's taking your whatever. You got to go prove it then. So there's a lot of legislators coming in trying to show how good they are, trying to impress everybody.
Seth Tupper:
And on top of all that, we might switch governors in the middle of the session.
Brad "Murdoc" Jurgensen:
Then there's an administrative switch. And then the national scene, I don't know how directly it affects our local state Legislature that Syria's fallen, but the ladder's rickety right now.
Lori Walsh:
Yeah. Yeah. The ladder's rickety. You mentioned Governor Kristi Noem and maybe a new governor, Lieutenant Governor Larry Rhoden. Well, presumably, again, we don't know for sure, but all signs point to Kristi Noem getting approved and appointed as Director of Homeland Security or Secretary. And that leaves a transition and a moment to reflect on her legacy a little bit.
Seth, you've been covering her for a long time. I'm thinking back to the Tax Cuts and Jobs Act when she was standing behind President Donald Trump and she was in Congress. And then there was buzz that she would be Ag secretary, and she was instead governor and wanted to stay here for the people of South Dakota, that some of the early opportunities that we had to see her attached to Donald Trump.
And what are some of the early things that you think people will remember about her legacy as governor? Anything pre-pandemic particularly?
Seth Tupper:
Anything pre-pandemic? "Meth, we're on it."
Brad "Murdoc" Jurgensen:
And you forget all about that, right?
Seth Tupper:
That's the first thing that comes to mind pre-pandemic, because we forget that consumed her administration. It was a national controversy.
Lori Walsh:
For people who don't know, this was national controversy over an ad campaign that was supposed to reduce meth usage. And the tagline was, "Meth, we're on it." Meaning, "Hey, as a community, we're on this problem. We're tackling this problem." But the optics were just meth, we are on it. And it just didn't land essentially.
Seth Tupper:
And the pandemic came along and that we all forgot about that.
Brad "Murdoc" Jurgensen:
Right.
Lori Walsh:
I still see the bumper stickers. I still see the bumper stickers that say, "New governor, we're on it."
Brad "Murdoc" Jurgensen:
I argue about this still. Everyone, she was batting a thousand until Cricket. "Meth, we're on it" is funny and it ages bad, but you still see the bumper stickers.
Seth Tupper:
Well, you could argue she's still batting a thousand because she's going to be in the Trump administration, which is where she wanted to be.
But my point was that when I think of her legacy, she is somebody who was great at bringing attention to herself and to South Dakota. And whether that was good or bad attention is something that will be debated for a long time and will continue to be debated. In some instances, it was good, some it was bad.
Some people feel differently, but she was fantastic at things like that. The "meth, we're on it" campaign. Getting President Trump to come to Mount Rushmore. Bringing national attention to South Dakota when she did things differently during the pandemic than some other governors did. Creating controversies on social media that put her in the national spotlight and on and on and on.
And that to me was the dominant theme of her time as governor was being a master of manipulating the public conversation and bringing attention to herself and to the state in ways both good and bad probably.
Lori Walsh:
Yeah.
Brad "Murdoc" Jurgensen:
I think you could write either narrative. It could age either way.
Lori Walsh:
It's going to age both ways, right?
Brad "Murdoc" Jurgensen:
Yes, that's a good way to put it, isn't it? Depending on your camp, it's already pre-aged.
Lori Walsh:
Right. I remember I was in Hawaii, which is a long ways away from South Dakota, and we were in the hotel and they had an art display up. And I stopped and talked to the artist and she said, "Where are you from?" And I said, "South Dakota." And she said, "I love your governor."
Brad "Murdoc" Jurgensen:
Universally.
Lori Walsh:
And I said, "What is it that you love about her? What inspires you?" And she said, "She is so strong. Her strength just inspires me." And that resonated. And that was probably 2021.
And Seth, you write about "should." And the word should that I remember you reporting on at the time. And you've reminded us about that. Say more because in one camp you'll hear people around the country who really believed that South Dakota had done things right. And admire Kristi Noem for her strength in that. And then you point at this little word called should and say, "It was a very delicate communication dance that she was doing."
Tell us more about that for people who have forgotten.
Seth Tupper:
Well, the backstory on this, I got invited by the Washington Post to contribute to a compilation of short opinion pieces about Trump's cabinet picks. And they just reached out to some people who've covered Governor Noem, and they said, "Do you have a vignette or something that really illustrates who she is and her personality and whatever?"
And I thought immediately to this episode from the pandemic, that to me is just seared into my memory. It happened while I was at SDPB, a reporter, I was sitting here in the Rapid City studio. She was having a pandemic press conference. And I had dialed into it. And so it had reporters from all over the state. And she was putting out an executive order, and we all thought, okay, here it is. Here's these are the orders, how we're going to handle this pandemic, and there's going to be clarity and there's going to be what we're supposed to do.
The executive order was, "You should do this, you should do that." Should, should, should, should. And then her press conference, "Should, should, should, should."
And I was just mystified and aggravated because it was like, this is a crisis. We need clear communication. What is she saying?
And I asked her in that press conference, "What do you mean? Is it something that, are you ordering people to do something? You're giving suggestions?" And she would not clarify it. And I really didn't know what was going on or what the strategy was or if there was a strategy at that time.
And then of course, as the pandemic wore on, she was able to capitalize on the fact that she didn't technically order anybody to do anything, and say that she took a different approach. And that has catapulted her to where she is today. That was what drew national attention to her. That was what gave her the standing to attract.
Brad "Murdoc" Jurgensen:
It also had huge South Dakota implications too. The Sturgis Rally happened to that year.
Seth Tupper:
Right?
Brad "Murdoc" Jurgensen:
A quarter million people showed up. I was there. And if that block of people would've picked the new leader, she would've been universal leader for life.
Seth Tupper:
Yeah.
Lori Walsh:
Yeah. And then Murdoc, go back to what you're saying again about the book and Cricket because she was doing really strong and getting everything she wanted. And then that book really threatened to derail her.
Brad "Murdoc" Jurgensen:
You think about the gender law on the ballot was part of her initiative. If she was going to get the opportunity to run for vice president, that was going to elevate her up. And then that book thing, whether or not she was ultimately going to be picked or not, or if it was just good theater. That book thing really took her out of the national spotlight for a while. Noem is wildly popular when people come to the Hills or when you're out in the country. It's still a huge majority who are very big on her. But you can notice the decrease after the whole book thing.
Seth Tupper:
This just underscores where we were before with the good and bad attention. As you mentioned, for a lot of years, wherever you travel in the country, somebody would say, "South Dakota, you're the one with that governor, she's great." But lately I also get, "Isn't she the one that shot the dog?"
Brad "Murdoc" Jurgensen:
Yes. There's the dog.
Seth Tupper:
It's attention. It's good and bad. And she's a lightning rod. And that's how I'll always remember her.
Lori Walsh:
It could keep her from presidential ambitions, but it's not going to keep her from being, most likely, the head of Homeland Security.
Brad "Murdoc" Jurgensen:
Doesn't look like it.
Lori Walsh:
But she maybe could have been vice president. We will never know how these things play out. But we do know that politics is a dirty business.
Seth Tupper:
Yeah. And when you think about her media tour for the book and how brutal that got, she could be in for a repeat of that during the Senate confirmation hearing.
Brad "Murdoc" Jurgensen:
I suppose it comes up again, right? Just the Democrats?
Seth Tupper:
Oh yeah.
Lori Walsh:
Everything comes up again. Everything comes up again. Everything that we have reported, everything that other people have reported, every time she's in front of the camera, all these things come up again because these are questions that people who are running for office have to answer and are given the opportunity to clarify. And they're held accountable to their words and to their actions.
Brad "Murdoc" Jurgensen:
To your point though, Lori, from earlier, there are two sides of this. And it has pre-aged, so you already think one way, most people, not everybody, already have aged this topic on their own, which is a weird way to look at it.
Lori Walsh:
And here on SDPB, you get to hear both sides with non-biased political reporting and analysis from our Dakota Political Junkies.
Brad "Murdoc" Jurgensen:
At least for a little while.
Lori Walsh:
We will leave it there.
Brad "Murdoc" Jurgensen:
Sorry.
Lori Walsh:
We feel very confident in the story we have to tell, Murdoc, and the support that we are getting from listeners and state legislators, I think we'll be here for a while. And we thank you for joining us.
Don't just all go to Dakota Town Hall yet. There's room for both of us.
Brad "Murdoc" Jurgensen:
I think you guys will be here for a long time.
Lori Walsh:
All right.
Brad "Murdoc" Jurgensen:
We're here for it.
Lori Walsh:
Thanks guys. We'll see you next time.
Brad "Murdoc" Jurgensen:
Thanks.
Seth Tupper:
Thank you.
