Daugaard discusses IM 22, Gear Up, economy in sit down interview

Published: Dec. 25, 2017 at 9:23 PM CST
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In recent years it has been a tradition that on Christmas evening KSFY News spend some time with Governor Dennis Daugaard talking about the past year.

He accepted our invitation again this year for an interview that touched on ethics, the state's ever increasing problem with meth and South Dakota's shaky economy.

We sat down with the governor at his formal office inside the state capitol in Pierre.

Thirteen months ago, South Dakota voters approved Initiated Measure 22, a package of changes meant to make state government more transparent.

Twenty-two was repealed by the legislature with the governor's blessing.

I asked him, over a year later, if he still believes repealing a vote that was the will of the people was the right thing to do and he says.....yes.

"It's really hard for a voter to look at a 30 page bill....30 page initiated measure and draw a conclusion about whether it's good or bad," he said.

The governor says changes for transparency should be the result of the legislative process working, not the result of an initiated measure which the governor says doesn't allow much room for change or modification.

"That doesn't exist in an initiated measure. All you've got is a yes or a no," he said. "You can't amend it. You can't shorten it. You can't add to it. It's yes or no."

Specific to Initiated Measure 22, the governor says he believes nothing was really lost by repealing it, telling me he believes it was more flash than substance and light on actual mechanisms to improve transparency.

"It was attention creating and it was emotion satisfying but in terms of addressing the issues that caused some of the problems that it was intended to address it didn't address them," Daugaard said.

From there we talked about the on going Gear Up matter involving the mismanagement of state funds by the administrator's of the state's Gear Up program, which was meant to improve educational opportunities for Native American students.

Instead those funds were embezzled by 'Gear Up' manager Scott Westerhuis...to the tune of at least $1.4 million in personal gain....and when that embezzlement was uncovered in 2015, Westerhuis shot and killed his wife and four kids before setting their home on fire and shooting himself.

"It's easy to say 'oh, this should have been discovered sooner than it was by the Department or by the Attorney General or by the Governors Office,'" Daugaard said.

The governor tells me he understands that his office and the office of Attorney General Marty Jackley are easy targets for scorn, but tells me government has to work under an element of trust and if those is charge violate that trust, it might not be easy to see or detect and the governor says that is what has happened in the case of 'Gear Up'.

"At the state level we were counting on the goodwill of the directors who were volunteers and civic leaders who are overseeing that corporation and overseeing the employees of that corporation. They didn't get it done," he said.

Three other 'Gear Up' administrators will go on trial next year for allegedly aiding in the embezzlement scheme.

As far as that scheme being discovered after the fact....the governor says obviously he wishes that was not the case.

"Did they fail to discover it as soon as I wish they would have? Yeah. But that's all hindsight," he said.

From 'Gear Up', we moved on to the increasing statewide fight against meth use and abuse.

"Meth is a problem...Meth is the problem in South Dakota," he said.

Governor Dauaagrd says meth is a problem not only in the human toll for those who become addicted, but the increasing toll it's taking on courts and jails statewide; both are clogged up and overcrowded.

And in most cases, the governor says, the crime these people are in for....is the use of the drug.

So in the new year, there is going to be a push to try something new to expand the number of people who get treatment.

"One of the things we will be looking at here in the coming year is the possibility of expanding treatment availability to adults on Medicaid and having substance abuse treatment be covered by Medicaid," he said. "Right now it is not."

The governor tells me that law enforcement is telling him that the meth in South Dakota is not homemade; that it's being brought in from as far away as Mexico, and that as a result he is working to boost the state highway patrol's efforts to find and stop Meth traffickers.

"I'm hoping we can turn this around," Daugaard said.

We then discussed the continuing challenges facing the South Dakota economy; in specific another season where sales tax revenues have fallen short of projections.

"When I leave this office I want to hand it off to the next governor and have them say I'm inheriting a budget and a state that's fiscally in good shape," he said.

Earlier this month the governor detailed a nearly $34 million state budget shortfall, the result of a slowing farm economy and an increase in internet sales. Some of the websites involved do not collect sales tax for the state and the governor tells me internet sales are only going to grow which may make future budgets even more challenging.

"Those who are still in the rural areas...they're going to increasingly turn to the internet to buy and then young people increasingly use electronics and use the internet to buy," Daugaard said.

Complicating matters, the rising cost of health care. Which means people have even less money to spend on goods and services....and even less sales tax revenue for the state.

Governor Dauaagrd says if the state revenues are out of line, it means everything else it out of line.

"You can do all these other things right but if you don't have the financial capacity to manage the goods and services that your citizens expect then you can't provide those services and goods," he said.

And as far as the economy goes, the governor believes the Ag sector will bounce back and medical costs will moderate but beyond that is a question of when those things will happen.