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September 13, 2017 10:00 PM

The Twisted Money Trail

Spencer, SD

Millions of donations are pouring in to help victims of both Hurricane Harvey and Irma.  In fact, all three major TV networks raised money just this week.

KELOLAND has seen its own devastation from Mother Nature.  On May 30, 1998, a deadly tornado wiped the town of Spencer South Dakota off the map.  

More than $1 million in donations came in from people all across the region to help those who lost everything to the deadly twister. 

But did every dime go to victims?

In tonight's Eye on KELOLAND investigation, Angela Kennecke tracks down where the money went and how long it lasted after the twister had touched down.  Some of what she found may surprise you and even make you think twice about giving to relief efforts. 

“And then all of a sudden it just got black.  And the wind came up," Dave Twedt said.  

Dave and Mary Twedt rushed to the basement on that fateful day in Spencer in 1998.

"And when I rolled around and looked like this, I realized I wasn't looking at floor joists anymore, I was looking at the sky.  There was absolutely nothing left of the house... gone. Five more seconds, we probably wouldn't have been here talking to you. We probably would have been gone," Dave Twedt said.

The Twedts were featured in People magazine's article that year on the twister.  One year later, People returned to Spencer to see how the rebuilding was going.

“I think Midwest people are just beyond themselves and are all about helping others in a time of need,” Dave Twedt said.

Just a few days after the twister flatted Spencer, KELOLAND TV organized a telethon to help tornado victims.

With the help of thousands of viewers we raised more than $1,000,000 for the Spencer Tornado Relief Fund.

The late Governor Bill Janklow said none of the money would go for other than what was intended--helping victims rebuild their lives:

"It's going to be money that has no administrative costs, no administrative overhead; no bureaucracy assigned to it," Janklow said in 1998. 

A special committee was formed to decide where the money would go.

"Every Spencer household affected by the tornado has gotten $2,000 plus a $500 child allowance.  But there's still $650,000 left. 

"I don't want this fund to be sitting here on a bunch of money when we've got people out there who need it.”

Former KELOLAND News Director Mark Millage was on that volunteer committee.

"We tried to be judicious in how we would handle the money as if it were our own," Millage said.

The Twedts got a few thousand dollars form the fund, as well as new garage doors and furnace.  But not all of their requests were honored, like when they asked for money to pay for labor to install a new roof. 

"We had the materials.  All I wanted was manpower and they wouldn't help me with that. I was just devastated," Mary Twedt said.

Tornado victims were required to use up all of their insurance money first.  

"It was to demonstrate real need and show where other funds and relief efforts didn't cover we might and in most cases we did; maybe not to full request, but I think we were reasonable in how we handled those requests," Millage said.  

KELOLAND Investigates found there was approximately $25 million paid in insurance claims after the tornado.  

FEMA paid out another $4 million in public an individual assistance.  The town got another $1 million in community block grants. And then there was the $1 million dollar Spencer Tornado Relief Fund--with most of that money coming from the KELOLAND telethon.

That's a total of $31 million dollars. At the time of the tornado Spencer had 350 residents.  Now only 170 people live there. 

"Where did this money actually go?  How did it get used? How much went to the victims? Dave Twedt said.

Donna Ruden is a long time Spencer leader and currently the Town Board President.  

AK:   Are you confident that that $1 million in the Governor's Fund that was just from donations from people, all went to victims?
Donna Ruden: You know I believe the majority of it did. 

"This is one of the things I'd really like cleared up.  Did money go for the water tower? Did money go to pave the streets and one of the other things that bothers me; did they use donated money to buy the gas station building?" Dave Twedt said.

The Twedts want to know because of a promise made by Governor Janklow during the 1998 telethon.

"This isn't a fundraiser for Spencer.  This is a fundraiser for the people of Spencer.  We're going to take care of the people of Spencer the Government will take care of the infrastructure.  We take care of the people," Janklow said during the KELOLAND TV telethon in 1998.  

Donated money did end up going for infrastructure, including $37,000 into these low-income apartments, $75,000 to bring rural water into town, $21,000 for a community building and $28,000 for streets for a total of $161,000.

After the committee allocated the money, KELOLAND Investigates found $45,000 was left and turned over to the City of Spencer in 2007, some nine years after the tornado. It was used to buy this former auto repair garage and turn it into a coffee shop and gym. 

"Was it necessary to buy another building for a town of 150 people?  Probably not," Dave Twedt said.

The Twedts say they didn't want any more money, but they would like to have seen any leftover funds go to future disaster victims. 

"If there is money and they are using it for unnecessary things in the town, that shouldn't be happening.  It should go to the next victims," Mary Twedt said.

The money left over from the telethon isn’t the only money in question. 

Spencer is still sitting on tens of thousands of dollars in a Disaster Relief fund today.  Thursday night we'll continue to follow the twisted money trail. 

 I'll investigate why that is and show you years of audit findings that bring up problems with the town's finances, including one where Spencer broke South Dakota law. 

© 2017 KELOLAND TV. All Rights Reserved.



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