Kristi Noem and the GOP Legislators point fingers at each other in housing money failure

South Dakota legislators were informed last week that $200 million designated for workforce housing grants will not be available for another construction season. However, this delay could have been averted if they had permitted the governor’s office to oversee the grant program.

Gov. Kristi Noem asserted in an interview with The Dakota Scout that the ongoing postponement of the workforce housing infrastructure initiative is due to unnecessary bureaucracy that could have been bypassed. She stated that if her original plan had been followed, homes would have been built and occupied by families by now, as the funds would have been released a year and a half ago. The governor made these comments during an event in Sioux Falls where she announced a $7.9 million apprenticeship grant program offered by the state labor office.

Her remarks came after the South Dakota Housing Development Authority (SDHDA) announced last week that it might be September before its board starts officially reviewing applications from builders, developers, and communities. In December 2021, Noem proposed allocating $150 million from state funds and $50 million from federal funds for infrastructure and utility installation costs related to workforce housing projects, with the Governor’s Office of Economic Development managing the program.

However, most lawmakers preferred the SDHDA to handle the $200 million, which the 2022 legislation distributing the funds required. This legislation turned out to be unfeasible, causing the SDHDA to retain the funds throughout the 2022 construction season until new legislation could rectify the initial legislation’s shortcomings.

The necessary changes were made in January, but the legislative timeline for the rule-making process and the requirement for the Governor’s Office of Economic Development to approve the rules before submitting them to the Legislature’s Rules Review Committee mean the program is unlikely to be operational until autumn.

Noem expressed disappointment that the funds have not been distributed yet, attributing the delay to the bureaucratic processes established by both the 2022 and 2023 legislation. She emphasized that she initially wanted the grants to go directly to communities for immediate housing construction, but the decision to involve the housing authority has resulted in a slow-moving process resembling other federal housing programs.