South Dakota lawmakers debate over $200 million over workforce housing

PIERRE — A fraction of the nine numbers Gov. Kristi Noem wants for workforce housing is in the latest iteration of legislation that is once again dividing House Republicans.

But ongoing behind-the-scenes negotiations mean a $200 million spending package still has life.

Lawmakers worked late Wednesday to try to resolve philosophical, procedural and substantive differences over a $200 million proposal to provide grants and loans to cover the costs of utility infrastructure that comes with new real estate developments.

But a two-part plan by proponents of a pair of complementary measures, like Reps. Roger Chase, R-Huron, and Caleb Finck, R-Tripp, failed to appease enough of their fellow objectors to get the two-thirds support. special funding packages are required for passage to the South Dakota Legislative Assembly.

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“I haven’t come that far to give it up yet,” Chase said after Senate Bill 65 came to a vote of approval.

The bill would have sent $150 million to the South Dakota Housing Development Authority for a revolving loan fund to be used by developers to offset utility construction costs. It also repealed an existing law that required SDHDA to only support projects with qualifying rents and mortgages.

A second measure, Senate Bill 53, included $50 million to be used for direct subsidies to housing-related utilities that would flow through the Governor’s Office of Economic Development.

This happened.

Both bills stem from a summer study on affordable housing and labor, which identified the cost of adding streets and utilities as a driver of rising home prices.

And with record revenues at the state’s disposal, Noem began pushing for the $200 million housing initiative in December when she delivered her annual budget speech.

Originally, the $200 million was bundled into one bill, SB 53, while the other only dealt with rules for SDHDA-eligible projects.

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But after the two bills were approved by the Senate last month, a late amendment was made to move $150 million from SB53 funds to SB65 to ease procedural issues around sending money. to two separate agencies in one measure.

That proved enough to push SB53 through with exactly the 47 votes needed to secure a two-thirds majority in the State House.

SB65, however, couldn’t make it happen.

Complicating the governor’s ambitions wasn’t just the same influential group of House Republicans who opposed new government grants of any kind this legislative session and blocked, or at least complicated, the passage of other bills. expenditure law.

Others, such as Aberdeen representatives Drew Dennert and Kaleb Weis, have argued that the scheme unfairly benefits large communities and large property developers. And there are doubts about the effectiveness of the initiative in general.

“Our housing market, our construction workers … have more orders than houses,” Weis said. “When you start subsidizing preparatory work to install more lots, it takes workers.

“Check the nation. Everyone has this problem, so I say the labor shortage is not a housing shortage,” he added.

Because the amendment was made to SB53, Chase and other housing initiative lawmakers could use a conference committee with the Senate to reinstate the $150 million that was placed in SB65. SB65’s language could also be placed in another piece of legislation through a procedural move known as the Hoghouse Amendment.

And it’s all part of the process, said Noem spokesman Ian Fury.

“The conversations will continue, the negotiations will continue, the legislative process will continue,” he said. “Everyone needs to take a deep breath.”