SOUTH DAKOTA FARMERS PREPARE FOR IMPACT FROM TRUMP TARIFFS

SOUTH DAKOTA (Stu Whitney / South Dakota News Watch) – During his March 4 address to a joint session of Congress at the U.S. Capitol, President Donald Trump defended his use of tariffs as a core economic and political strategy, adding a message to the agricultural community.

“Our farmers are going to have a field day right now,” Trump said during the speech. “So to our farmers, have a lot of fun. I love you too.”

In South Dakota, a state whose reliance on agricultural trade makes it more susceptible to the risks of tariffs and trade wars, the president’s words were viewed as hopeful but not entirely reassuring.

Farmers have sturdy memories. They recall the volatility of commodity prices and exports during Trump’s first White House stint, when much of the state’s soybean flow to China was halted due to tariff retaliation and has struggled to recover.

“(Tariffs) will hurt our pocketbooks, obviously,” said Rodney Koch, who grows soybeans and other crops north of Garretson, about 20 miles northeast of Sioux Falls. “But will we come out of it better in the long run? That’s the hope.”

U.S. Sen. Mike Rounds echoed that sentiment in a statement to News Watch, saying that “there needs to be an end game, and I believe the president is working with that same goal in mind.”

So far, the only certainty is uncertainty.

On March 4, Trump slapped 25% tariffs on almost all imports from Canada and Mexico and an additional 10% on imports from China, rattling stock markets and triggering retaliatory actions from the countries involved.

Two days later, the president announced that he was postponing 25% tariffs on many imports from Mexico and some imports from Canada for a month amid widespread fears of the economic fallout.

Corn, wheat and soybean prices dropped in the days following the trade shakeup, and farmers weighed the impact of more expensive machinery and fertilizer coming down from Canada.

“One thing the market doesn’t like is uncertainty because uncertainty means risk,” said Jared McEntaffer, CEO of the Dakota Institute, an economic research and analysis organization in Sioux Falls. “If farmers are concerned that they’re going to see lower commodity prices in the future, then naturally, they’re going to start pulling back on their spending. And it becomes a ripple effect.”

News Watch talked to farmers, business leaders, economists and politicians to try to clear up some misconceptions about tariffs and examine how South Dakota’s farm economy could be impacted in the coming months and years.

What are tariffs exactly?

Tariffs are a tax on imports, in which the buyer pays a foreign seller an established tax rate based on what is being sold. Percentages are generally lower for countries with which the United States has a favorable trade agreement.

The money is collected by Customs and Border Protection agents at 328 ports of entry across the country. Because companies are paying more for the goods, that extra cost frequently gets passed on to consumers in the form of higher prices.

“There’s a narrative out there that we’re going to be imposing these taxes on Canada and Mexico,” said McEntaffer. “That’s not the case. The tax will be paid by American companies and consumers.”

How do tariff policies impact South Dakota?

Farming helps drive the state economy, with agricultural production and processing accounting for about 14% of South Dakota’s gross domestic product (the total value of all goods and services produced).

The wholesaling of corn, wheat and soybeans brought in $10 billion in overall revenue in 2024, second among South Dakota industries to credit card issuing ($18 billion).

Though many of these farm goods are sold domestically, a large percentage (including 60% of soybeans) are sold to international buyers.

South Dakota is the country’s 12th largest agricultural exporting state, shipping $5.4 billion in farm goods abroad in 2022, led by soybeans, corn, feed grains, beef, veal and wheat.

Don’t tariffs impact U.S. imports, not exports?

The thing about tariffs is that there is almost always retaliation, as we’ve seen with Canada, Mexico and China. That’s what is meant by trade wars.

In 2018, when Trump slapped a 25% tariff on goods from China, the Chinese government responded in kind. That greatly reduced the exporting of soybeans into China as that country looked to Brazil to fill the void.

As of November 2024, China accounted for only 44% of total U.S. soybean sales, down from 62% in 2016. From 2019-2023, an average of 73% of Brazil’s exported soybeans went to China.

What are South Dakota politicians saying?

Tariffs present a political quandary for South Dakota’s congressional delegation, which is caught between Trump’s enduring popularity (he carried the state with 63% of the vote in 2024) and the economic needs of their ag-based constituents.

So far, Thune, Rounds and U.S. Rep. Dusty Johnson have publicly backed Trump’s aggressive trade strategy while also calling for reasonable time limits and parameters.

Kristi Noem, former South Dakota governor and U.S. representative who’s now secretary of the Department of Homeland Security, has ardently supported the trade measures as a means of securing the border.

Those statements illustrate a much different political climate than South Dakota Republican leaders operated under in 2018, when Trump levied tariffs against China during his first term in office.

At that time, Thune, Rounds and Noem sent a public letter to the president expressing “serious concern” over the tariffs and other trade policies that they said could push “an alarming number” of South Dakota farmers and ranchers “to the brink of economic collapse.”

Will there be a farm bailout coming this time?

The “temporary pain” of U.S. farmers during the first go-round of Trump tariffs in 2018-19 was addressed by authorizing payments to U.S. farmers of $28 billion to offset their losses from Chinese trade retaliation.

Given the state of the federal deficit and the administration’s focus on cutting government spending, it seems unlikely that a similar round of farm bailouts will be offered this time around.

 

SDPB LEADERS MAKING FINAL PUSH TO RESTORE FUNDING

PIERRE, S.D. (Todd Epp / SDBA) – South Dakota Public Broadcasting officials are making a last-minute appeal to save their state funding as lawmakers prepare for a critical budget vote on Tuesday.

The Friends of SDPB says the Joint Committee on Appropriations will consider SDPB’s “motion sheet” to restore funding at its 8 a.m. meeting on Tuesday in Room 362 of the State Capitol.

“We’re very hopeful for a full restoration of SDPB’s funding, but it literally is coming down to the final days,” said Ryan Howlett, CEO of Friends of South Dakota Public Broadcasting, in a March 7 email to supporters.

The current budget proposal would cut SDPB’s funding by $3.6 million, reducing it from $11 million to $4 million, due to state budget constraints and resource reallocation.

This reduction would eliminate 50 staff positions, shrinking SDPB from a 76-person organization to just 26 employees, mostly in engineering.

“It’s not just a $3.6 million budget cut. It’s much more substantial than that because of the domino effect,” Howlett said during a recent legislative hearing.

Howlett warns that the cuts would end local programming and affect SDPB’s role as the state’s emergency alert system, which reaches 98 percent of South Dakota through a network independent of internet connectivity.

“We physically activate the AMBER alerts, the endangered person’s alerts, the blue alerts,” said SeVern Ashes, SDPB director of engineering at a hearing earlier this session. “If we lost internet, we could still get alerts out.”

High school sports coverage would also be affected. According to Dan Swartos, executive director of the South Dakota High School Activities Association, SDPB covers between 40 and 50 state championship events yearly.

“We’re not going to find another over-the-air partner who’s able to do that,” Swartos said at an appropriations hearing.

Howlett has urged citizens to contact their legislators and attend local public forums, known as ‘cracker barrels,’ to show support. In a February email, he specifically mentioned the importance of contacting state senators, where the proposal has faced resistance.

According to Howlett, SDPB will need 10 votes from the 18-member Joint Appropriations Committee to approve their motion sheet. If the Joint Appropriations Committee approves the motion, the General Appropriations Bill will include the restoration and go to the full House and Senate.

The cuts will take effect on July 1 if the final budget passes without restoring SDPB’s funding.

Only four legislative days remain in the regular session. Tuesday’s vote represents what Howlett calls “the last critical step in the process.”

 

PROPERTY TAX RELIEF BILL RISES FROM THE DEAD IN SOUTH DAKOTA HOUSE OF REPRESENTATIVES

PIERRE, S.D. (SDBA) – Left for dead after its first vote, Senate Bill 216 sprang back to life Monday, passing the South Dakota House 53-16 and giving property owners their only hope for tax relief this session.

The bill, backed by Gov. Larry Rhoden, passed with one member excused after lawmakers reconsidered their initial rejection. The legislation returns to the Senate for consideration of House amendments.

SB 216 aims to reduce growth in property tax assessments on owner-occupied homes by capping total assessed value increases at 3 percent annually for tax years 2027 through 2031.

“I think you need to at least look at section 1 which sets a limit of 3% annual growth on each county’s total assessment for owner-occupied,” said Rep. Leslie Heinemann, R-Flandreau. “I visited with my assessor at length at last Friday, and they could implement this, but this would be a way to restrict growth.”

The legislation also limits property tax revenue increases for taxing districts to 3 percent during the same period and significantly changes the property tax assessment freeze program for elderly and disabled residents.

“The other thing I think you don’t want to overlook is sections 4 & 5, and that’s increasing the eligibility for the existing property tax freeze program,” added Heinemann. “Most of the people there’s 33,000 people that are eligible for it now based on this income restriction and this would open up another 11,000 people to be eligible for that.”

The property tax freeze program changes increase income thresholds from $35,000 to $55,000 for single-member households and from $45,000 to $65,000 for multiple-member households. The bill also raises the maximum home value eligible for the program from $350,000 to $500,000.

Rep. Liz May, R-Kyle, criticized the limited scope of the legislation.

“Rifle shot? Rifle shot for who?” asked May. “So, for all our constituents listening out there, yeah, we’re gonna give you a bill. Does it do anything? No, not really. It’s a rifle shot. We’re gonna study it again this summer.”

Rep. Greg Jamison, R-Sioux Falls, who initially opposed the measure, acknowledged that improvements were made through compromise.

“This amendment addition does lighten the load of the blunt that these growing communities and counties will receive with this bill, and that was that was appreciated by the governor and his staff to make an adjustment,” said Jamison.

Rep. Heinemann characterized the bill as a beginning step toward addressing property tax concerns.

“It is a shot over the bow. It’s to say we, including the counties, the cities, the schools, need to reduce their spending. That’s clear to me,” Heinemann explained.

The Senate must now decide whether to concur with House amendments or request a conference committee to resolve differences between the versions passed by each chamber.

Earlier in the afternoon, the House killed two other property tax reduction measures, SB 169 and SB 191.

 

DAKOTA DUNES MURDER CASE, JURY SELECTION BEGINS, SOME CHARGES DROPPED

ELK POINT, S.D. (KTIV) – Days away from a murder trial some of the charges against the suspect in the Dakota Dunes murder case have been dismissed.

Alfredo Castellanos-Rosales had been charged with first-degree murder, and two counts of child endangerment, in the April 2023 death of Jordan Beardshear. He fled the country and was arrested two weeks later in Mexico and deported back to the United States to face his charges.

According to court documents filed on March 5, both Count 2 Contributing to the Neglect of a Child and Count 3 Contributing to the Abuse of a Child have been dismissed by the prosecuting attorney.

This latest update follows a recent pre-trail where the defense attorneys sought to have the trial moved from Union County. A judge denied that request.

In the lead up to the trial the defense had also sought to admonish the use of the word “victim” or “alleged victim” by the state and witnesses. The judge also ruled against this motion, though asked all parties to limit the use of the term.

The judge did ban any photographs, t-shirts, buttons or other material with Beardshears’ face from the courtroom, including from those in the gallery watching the trial.

In September, a judge ruled that conversations between Castellanos-Rosales and his wife, Reyna Castellanos-Rosales, could be used as evidence. The move was argued by the defense that it be excluded based on spousal privilege.

In that conversation, Alfredo Castellanos-Rosales allegedly admitted to killing Beardshear and sought help in leaving the country.

The jury pool is made up of nearly 300 potential jurors. Jury selection began yesterday (March 10, 2025) and the trial is expected to last three weeks.

 

SOME LEGISLATIVE LEADERS SLAM COUNTY GOVERNMENT FOR BUDGET WOES

PIERRE, S.D. (Joshua Haiar / South Dakota Searchlight) – Two years ago, South Dakota lawmakers were so concerned about the financial struggles of counties that they devoted a summer study to the topic.

After it was completed, state Sen. Randy Deibert, R-Spearfish, a former Lawrence County commissioner and member of the study committee, said it was illuminating.

“I do believe we’ve had a lot of education that’s taken place because of the summer study — especially with the committee members and the word they’re getting out to constituents and fellow legislators about the hardships counties are having and why they’re having it.”

This winter during the annual legislative session, the conversation has changed. Some Republican lawmakers are arguing that spending — not inadequate funding — is the problem.

Deibert’s fellow Spearfish resident, Republican House Majority Leader Scott Odenbach, has been repeating a mantra this session: “It’s the spending.” He applies the criticism to both schools and counties, saying the growth in property taxes is driven by their budgets.

The shift in rhetoric has the president of the South Dakota Association of County Commissioners frustrated.

“The property tax problem has been caused by the state legislators’ push of all the unfunded mandates onto the backs of the counties,” said Dan Klimisch, who also serves as a Yankton County commissioner.

Sandra Waltman, director of public affairs for the South Dakota Education Association, said recent polling conducted by a coalition of public education advocates shows most South Dakotans think public schools receive too little funding, with only 9% of respondents saying they receive too much.

“We’re 49th in the nation for teacher pay,” Waltman cited as evidence that schools are not overspending.

From cash-strapped to a spending problem

The debate over county and school finances comes amid discussions about property tax reform. It’s a top priority for Republicans responding to voter frustration over increased home valuations and taxes, particularly in areas of the state that experienced rapid growth during the COVID-19 pandemic.

Lawmakers are considering multiple property tax bills that would place stricter caps on local property tax collections, roll back and cap the growth of home assessments, expand eligibility among disabled and elderly people for relief programs, and more.

Rep. Greg Jamison, R-Sioux Falls, introduced a bill that would lower the cap on annual property tax collection inflationary growth from the lower of 3% or inflation to the lower of 2.5% or inflation. He said the bill sends a message to local taxing districts.

“And that message is, ‘give me a break,’” he said. “Property taxes are haunting all of us.”

Last year, after the summer study on county funding, it was counties that were asking for a break. Many lawmakers were inclined to help.

The Legislature funded a $7 million initiative to help local governments with cybersecurity, and approved a $3 million, one-time appropriation to help counties cover costs they’re required to pay for criminal defendants who need public defenders or court-appointed attorneys. Lawmakers also approved the creation of a new state public defender’s office to handle appeals from some of those defendants, taking some of the burden off counties.

Meanwhile, homeowner property taxes continued to rise, demand for relief increased, and many legislators campaigned last fall on delivering relief.

An initial proposal this year from Deibert and then-Rep. Tony Venhuizen, R-Sioux Falls (now the lieutenant governor), would have reduced the property tax levy on owner-occupied homes for general education and special education to zero and raised the state sales tax rate from 4.2% to 5% to replace the revenue.

That proposal went nowhere, and legislators have subsequently focused on proposals — including one from Venhuizen’s new boss, Gov. Larry Rhoden — that would achieve property tax relief through one or more limits on local government spending, with no replacement funding for lost revenue.

Odenbach is calling for greater fiscal restraint at the county and school level.

“You’re not going to get property tax relief until you look at the spending done by our public school system and our counties, because that’s where local property taxes go,” Odenbach said.

Counties and schools are funded mostly by property taxes. Cities receive property tax revenue and sales tax revenue, while the state depends on sales taxes.

Governor’s advice: Find efficiencies

Gov. Rhoden said that when he took office, he told his staff to take inspiration from the Department of Government Efficiency, or DOGE, referencing the federal group managed by billionaire Elon Musk tasked with cutting government spending.

“And I believe the counties should do the same thing,” Rhoden said.

Rhoden pointed to the state’s 10% budget cuts in 2011 as an example of the kind of austerity counties should take inspiration from. He said local governments are often not held to the same standards as the state when it comes to belt-tightening.

But not all Republicans agree. Senate Majority Leader Jim Mehlhaff disagreed with Odenbach’s comments about local government spending during a recent Republican legislative leadership press conference. Mehlhaff was a member of the 2023 county funding study committee.

“I actually do have a little bit more sympathy for the job that our county commissioners are faced with, in trying to maintain the infrastructure, the roads and bridges that they have to take care of,” Mehlhaff said. “I know they are grinding a lot of the roads into gravel.”

Counties: We don’t have a choice

Klimisch said some Republican lawmakers’ shift in messaging ignores the financial realities counties face. He rejected claims of runaway spending, saying counties have been forced to absorb costs the state has offloaded onto them.

He said counties collect 100% of property taxes but only get about 27% of what’s collected. The rest is redistributed to schools, cities and other local entities.

Klimisch pointed to the rising costs of essential county services, including law enforcement, court-mandated public defense, and road maintenance. He highlighted the unpredictable nature of legal costs, noting that a single major criminal case could throw a county budget into disarray.

He and others who represent local governments will be busy lobbying legislators next week. Lawmakers have three property tax relief bills under consideration and four days left in this year’s legislative session.