Governor says many South Dakotans are feeling deep financial pain from the COVID-19 economy

Capitol News Bureau
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PIERRE, S.D. (KELO) — Governor Kristi Noem said Wednesday COVID-19 is drying up revenue for state and local governments in South Dakota, and that many businesses and families have seen their incomes wither or disappear altogether.

Congress needs to make clear federal aid can be used to patch up beleaguered governments’ budgets, Noem told news reporters. She served eight years in the U.S. House of Representatives before her 2018 election as governor.

“I think it’s premature today to know how we will fill budget holes, but what I can confirm for you is that our revenue into the state has been dramatically impacted. It has been substantial, from the numbers we have gotten so far. Obviously we haven’t had a lot of months under our belt yet, but this doesn’t just impact the state budget. It impacts every single family and business out there. It will impact city budgets, county budgets, our ability to invest in infrastructure, to run agencies and departments,” Noem said.

“So it’s pretty far-reaching and I would say that the impact to the state budget is directly reflected by what kind of economic activity is happening across the state and tells you how badly all of our businesses and employers are hurting as well, because they literally, as soon as this virus hit this country and the president asked everyone to stay home, by and large, the people of South Dakota did. And we saw that was immediately where those revenues and economic activity dropped off.”

She wants states to have the ability to show Congress their budget holes are resulting from the virus and for Congress to let states use some of federal funds to fill those needs.

“Today the way the (federal legislation’s) language is written, that’s in question. Some clarity on that in phase four would be very helpful,” Noem said, referring to the next round of federal aid many expect Congress to provide, “because we do not think we can utilize the funds that were included in phase three today for budget impacts.”

The latest forecast has South Dakota’s COVID-19 outbreak reaching its most severe spread in June. That timing puts in flux the Sturgis motorcycle rally and races in August, according to Noem — and with it creates uncertainty whether South Dakota will see what had become for decades an extra boost in-state sales tax and other government revenues.

“There has not been planning for the rally, knowing that we would anticipate peaking in mid-June, that we could end up curving down and still have infection rates in the state come August, but dealing with those events as they come up. As you know the last couple of months we’ve had every single event in the state, almost, canceled. And so we take into account the models that are available to us using the information and use our population factors to make sure that it is applicable to each and every day,” she said.

She continued, “And just know that every day we go forward we’re in a better position to make good decisions that are appropriate. We have more facts. We have more information. We learn more about the virus and that gets us even better prepared.”

The governor also had proclaimed a statewide day of prayer Wednesday and suggested to reporters that South Dakota families do some things in a different way during this Holy Week for the Christian faith and the start of Passover for the Jewish faith.

This has been a part of her character throughout her life. People found noteworthy that she didn’t allow alcohol to be served in the Capitol at her inauguration as governor, and that she hosted a worship service in the Capitol the next morning.

An evangelical Christian, Noem had already planned, long before the coronavirus pandemic, to give state employees administrative leave this Good Friday and on Easter Monday, so they could spend time with their families. That extra leave will still be the case, even though thousands of state employees under her control have been working remotely rather than from office buildings in recent weeks because of COVID-19.

“I know that this year the Easter holiday is going to look a lot different for a lot of folks in our state. Traditionally, we get families together, big gatherings, we all go to church, we spend quality time — some of those are just not going to be possible this Easter Sunday,” she said Wednesday.

“I’m going to ask all of you to consider starting a new tradition, a new tradition that has meaning, and think about that today, and as you do focus on prayer, that day of prayer across our state, that you pray for an end to this pandemic, that you pray for success in fighting this virus and this disease, you pray for strength for all those who are working long hours to care for individuals and comfort for those who have had losses,” she continued.

“And I know going through this Holy Week and into Easter Sunday that we will be successful and that we will come through on the other end,” she said.

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