EB-5 audit report released

Quick hits from the just-released audit of the Governor’s Office of Economic Development with regards to the EB-5 program:

  • Richard Benda, who oversaw the EB-5 program as economic development secretary and then went to work for the EB-5 program monitoring Northern Beef immediately after leaving office, approved an increase in state aid to Northern Beef Packers after he had already discussed this future work. The report concluded Benda should have been required to disclose his employment plans and recuse himself from anything to do with Northern Beef after that point: “The GOED should have had a policy in place that would have required Secretary Benda to disclose his future employment plans and remove himself from involvement in subsequent matters relating to NBP,” the audit concludes.
  • The state had highly inadequate systems set up to monitor its EB-5 contract with SDRC, Inc. SDRC’s email updates were “inadequate” and didn’t include bank statements to corroborate claims. “Documentation was not adequate to determine whether the DTSD or the GOED was receiving the copies of books, records and reports that were required to be provided.” Expenses were approved by Benda with no supporting documentation. For three years, bank accounts related to SDRC were not included in the state’s annual financial reports.
  • There was a very freewheeling approach to expense vouchers by Benda. In addition to the previously disclosed double-billing of airline tickets, the audit found Benda submitted, and was paid, reimbursements for nearly $15,000 in “translation services.” These six payments were made “in cash” and were handwritten. One was written on the letterhead of a Philippine hotel with four handwritten names. Five said, “pay by cash next trip.” All said the document was the “only invoice available.”

Lt. Gov. Matt Michels, speaking just now, said that even before these shortcomings were identified in the reviews, the cash payments couldn’t have happened under Gov. Dennis Daugaard’s administration.

"I can’t understand how it was happening before," Michels said. He noted that foreign trips under Daugaard have involved the governor and senior staff and been much more formally organized.

What’s in a name?

A few years ago, the South Dakota Senate included two people with identical-sounding last names: Sen. Tom Hansen and Sen. Gary Hanson. When reading the roll call out loud, the Senate secretary would read the last name first: “Hansen-Tom? Hanson-Gary?”

Today, there are also people with the same last name in the Senate. But when the secretary calls for their votes, she says “Chuck Jones? Tom Jones?”

On Friday, I asked Lt. Gov. Matt Michels, who presides over the Senate, about the difference. He said it was his decision, that he felt it sounded more natural to say the first name first.

Now you know.

Enjoy the Super Bowl, everyone.

Tags: Matt Michels

South Dakota’s only hope, and other gubernatorial jokes

Thursday night at the South Dakota Conference on Tourism banquet, both Gov. Dennis Daugaard and Lt. Gov. Matt Michels broke out some comedy routines to entertain the crowd. Here’s some samplings:

Michels, on New Jersey Gov. Chris Christie’s “Bridgegate" scandal, involving alleged punitive closing of access lanes to a bridge by Christie’s aides:

I said, “You know, that would never happen in South Dakota.”

(Quoting someone else) “Really?”

I said, “No, we would drive around the barricades.” 

And then I said, “We wouldn’t send any emails — that could be found.”

Daugaard, talking about the Macy’s parade/Joan Jett controversy:

To avoid further controversy, there’s only really one answer, one performer who can keep both the cattlemen and the music fans happy, and that performer is… Meat Loaf. He’s got hit records, he’s a carnivore, and he’s really, really available.

Michels, on Daugaard’s charity skydive last year:

The governor is always sort of concerned that I’m trying to move up to the number one spot. Okay, I did buy a freezer full of those Dairy Queen Blizzards… just to ensure he would actually jump out of that airplane.

Michels, on being the lieutenant governor:

I wonder, if the governor was indisposed for some reason, what kind of person would we need to have in that big chair leading us?

(Michels flashed a photo of South Dakota’s Teddy Roosevelt mascot character on the screen)

I think we’d need somebody like this, rough and tough, a leader, brimming with vim and vigor, don’t you think? Eyes gleaming with incredible intelligence behind these spectacles, delivering fiery speeches, framed with the manliest of mustaches.

Remind you of anybody?

I’m just saying.

Daugaard, discussing the new trend of “weight-loss vacations”:

You maybe have heard, on the global scale that this new trend, weight-loss vacations. Have you heard this? … These trips combine exercise in scenic locations with healthy eating to help visitors shed pounds.

I understand you can do at least one of those vacations right here in South Dakota.

The Wind Cave Weight Loss Weekend seals visitors underground for several days. They wander in the dark without food or water, until they reach their weight loss goals, or require medical emergency attention.

It’s traditional for the governor to tell a few jokes for the tourism banquet. My favorite of the several I’ve attended was Mike Rounds’ 2010 list of the “Top 10 Changes I’ll Face As A Former Governor.”

Gov. Dennis Daugaard and Lt. Gov. Matt Michels pose with retiring senior adviser Deb Bowman, following a group portrait Tuesday.

Gov. Dennis Daugaard and Lt. Gov. Matt Michels pose with retiring senior adviser Deb Bowman, following a group portrait Tuesday.

Lt. Gov. Matt Michels.

Lt. Gov. Matt Michels.

Tags: Matt Michels

Former lawmaker commits suicide after home searched for child porn

Late Thursday afternoon, word started to spread around the South Dakota Capitol that longtime former lawmaker Gil Koetzle had died.

No one had any specifics, or at least none that they would share. On the floor of the Senate today, Lt. Gov. Matt Michels briefly praised Koetzle.

"With Gil’s passing yesterday, I think we’re all stunned," Michels said. "Gil was a great person, just a super human being."

Other lawmakers expressed similar sentiments around the Capitol.

Now Argus Leader reporter John Hult has information that changes the tenor of the news considerably.

Koetzle, 60, committed suicide Thursday after authorities seized drugs and computers from his home after tracing child pornography to his email account, Hult reports.

We don’t yet have all the information yet, though detectives say that there is no “indication that there was any physical contact with children” by Koetzle.

For a summary of Koetzle as a legislator, read this Mercer piece.

UPDATE: Hult, saving me a bunch of work, talks to veteran lawmakers who served with Koetzle. Everyone was shocked by the news.

“If you’d have asked me to name 1,000 people who had a problem with that, Gil would have been the 1,000th,” said Rep. Bernie Hunhoff.

Read the follow-up here.

The Legislature begins

Today, the previews end and the lawmaking starts.

Well, the lawmaking probably actually only starts in earnest tomorrow. Today two significant things will happen:

  • lawmakers will elect their official leaders, such as Speaker of the House and President Pro Tempore of the Senate. These decisions have been made in advance, but the Speaker vote in particular could be interesting. Brian Gosch will almost certainly be the next Speaker, but will dissident Republicans speak or vote against him in what’s usually a litmus test of party-line support?
  • Gov. Dennis Daugaard will give his State of the State address, laying out the condition of the state and setting out some priorities. Spoiler: There will be a lot of comparisons to neighboring states, and South Dakota will come out ahead. Read a preview here, and learn more about his policy centerpiece, the criminal justice initiative, here.

Also, each day in the session, I’ll be recording a video interview with a lawmaker, lobbyist or official, talking about an issue of the day. (Perhaps by the 38th video I’ll finally be semi-comfortable in front of the cameras.) The first, a legislative preview with Lt. Gov. Matt Michels, is available to watch here.

The 12th Amendment at work. South Dakota’s electors for Republican Mitt Romney, Lt. Gov. Matt Michels, Gov. Dennis Daugaard and Attorney General Marty Jackley, officially cast South Dakota’s three electoral votes for Romney on Monday. Romney won South Dakota but lost the overall presidential election. (This happened yesterday, but I was on vacation, so.) Photo by Kelsey Webb of Daugaard’s office.

The 12th Amendment at work. South Dakota’s electors for Republican Mitt Romney, Lt. Gov. Matt Michels, Gov. Dennis Daugaard and Attorney General Marty Jackley, officially cast South Dakota’s three electoral votes for Romney on Monday. Romney won South Dakota but lost the overall presidential election. (This happened yesterday, but I was on vacation, so.) Photo by Kelsey Webb of Daugaard’s office.

Gov. Dennis Daugaard and Lt. Gov. Matt Michels at the podium as Daugaard prepares to begin his annual budget address in Pierre.

Gov. Dennis Daugaard and Lt. Gov. Matt Michels at the podium as Daugaard prepares to begin his annual budget address in Pierre.

A brief sports interlude; or, eating crow

Last night, at the Union County Republican Party’s Lincoln Day Dinner (where the focus was on Mike Rounds’ news), I chatted a little bit with Lt. Gov. Matt Michels, who came over from his home in Yankton. We talked about the 2011 Missouri River floods — and I also engaged in a little sports trash talk about the just-about-to-start game between his Green Bay Packers and my Chicago Bears.

The results of the first week of play, where the Packers lost to the 49ers and the Bears clicked on all cylinders against the Colts, made me think the Bears were in a good position. As it turned out, the first week’s lessons were mostly that the 49ers are really good and the Colts are really bad, rather than anything about the quality of the Bears and Packers. The Bears kept it close with the victorious Pack, as they always seem to do, but never led, never got it together, and made a ton of mistakes on their way to a loss.

So, Mr. Lieutenant Governor: you, and the Packers, win this one.

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