2023 State of the State Address
By: Governor Kristi Noem
January 10, 2023
Remarks as Prepared for Delivery
Lieutenant Governor Rhoden, Mr. Speaker, members of the House and Senate, Chief Justice Jensen, Supreme Court justices, constitutional officers, and my fellow South Dakotans:
The South Dakota state constitution requires the Governor to begin each legislative session by “[giving] the Legislature information concerning the affairs of the state and [recommending] the measures he considers necessary.” Notice I didn’t say “she.” The Constitution doesn’t say that. We’re going to fix that.
South Dakota is growing. We are thriving. And we are strong.
Our state’s agriculture industry is now a $32 billion industry, and it’s responsible for 1 in 5 jobs in the state. We need to continue to preserve agriculture’s opportunity to thrive. Tourism, financial services, and other industries are continuing to grow, as well.
Today I am going to share with you how our state has become the number one state for individuals, families, and businesses to build the American Dream, how we have promoted and will continue to promote stronger families, and how we will secure South Dakota for now and into the future.
We are number one in the nation for personal income growth over the past several years. That is how South Dakotans build the American Dream by working hard and earning more than they have before. We have the fastest growth of housing developments in the entire country. We have the most family-owned businesses of any state. That’s part of how we make families stronger. We have the most registered hunters per-capita of any state. And we were recognized for making the best decisions by the American Legislative Exchange Council. And one more thing – The South Dakota State University Jackrabbits are the FCS National Champions in Football! GO JACKS!
I normally wait to honor our military for the end of the speech, but I want to highlight this now: we are the number one state in the nation to live and work as a soldier, an airman, and a veteran. That is how we make South Dakota safer and more secure for the future.
Both our Army and Air Guard units have led the nation, winning award after award for best units in the country. Just this past month, we deployed the 109th Regional Support Group to the Middle East as part of Operation Inherent Resolve. But the National Guard stands ready here at home, too. When the winter snow and bitter cold hit our state just before Christmas, the men and women in uniform took time away from their families to help other families in need across the state, including all the tribal reservations that needed assistance. Would everyone who is a veteran or serves in the National Guard please rise to be recognized?
I believe South Dakota is the freest state in the nation. We fight to defend our constitutional rights. We ensure that every South Dakotan has the right to Life, Liberty, and the Pursuit of Happiness.
But here’s what I love about South Dakota – we never settle. We never sit back and say, “good enough.”
We turn the challenges we face into opportunities.
Together, I want all of us to take on the challenge of making South Dakota number one in: growth, tax climate, work ethic, and building – and supporting – strong families.
Our nation was built on Freedom – but our constitutional freedoms are under assault from Washington D.C.
America needs South Dakota’s example of how conservative policies and values make people’s lives better. These policies bring success and hope.
In the last four years, we made South Dakota the strongest state in America by making it the state to pursue the American Dream, a state for Stronger Families, and a Secure State. In the next four, we will prove that the best is yet to come.
BUILDING THE AMERICAN DREAM
Together, we must continue to build and advance the American Dream. And this legislative session, we will accomplish that.
We will accomplish it by cutting taxes for our people. We continue to have record surpluses. What should we do with our surplus? My answer is simple: Cut taxes and provide relief to South Dakotans.
I have been to a lot of grocery stores across the state over the past few months. Prices have increased so dramatically over the past two years that families are unprepared when they see the final bill in the checkout line. When I’ve been checking out groceries, about 1 in every 4 shoppers have had to put something back because they can’t pay for everything. Folks, South Dakotans need this relief.
Fair Market in Sioux Falls is a grocery store that provides a special service to those who need it. They offer groceries for about half the price that you see at a typical grocery store. Kristin Johnson recognized the need for affordable groceries in her community, so she opened Fair Market in early 2021. She’s had to relocate and expand multiple times as demand grew. And just last month, they opened a 2nd location on the west side of Sioux Falls.
When I visited, I met customers who were so grateful for the opportunity that Fair Market provides. Because many of their groceries are “reclaimed,” meaning there may have been a branding change, maybe it’s a damaged can, maybe it’s a seasonal good, or maybe there’s a market surplus. So there’s always something new and unique – many customers enjoy hunting for those unique finds.
Kristin, her husband Greg, and Denelle (who works with them) are here today. Would you all please stand? Thank you for everything that you do for the people of South Dakota.
Fair Market’s customers will greatly benefit from the elimination of the sales tax on groceries – but so will every South Dakota family, every person, every small business owner, even every homeowner. Our economy is the strongest it has ever been. Our revenues continue to grow. December revenues have us up another $10 million above legislative adopted estimates. Now is the time – let’s get it done.
South Dakota’s economy has been thriving over the past few years! But with that, we’ve experienced some growing pains. In 2022, our unemployment rate was the lowest it’s been in our state’s history. But we still have 23,000 open jobs in our state.
During my first year in office, I signed legislation that recognized occupational licenses for military spouses who moved to our state. Then, two years ago, in response to the challenge of filling healthcare jobs, I proposed legislation to recognize the healthcare licenses of folks moving here from other states. This legislation was expanded to other professions and helped us fill jobs. We have an opportunity now to finish the job and provide a path to recognize the licenses of just about every profession in the state.
When other states have done this, they have seen their workforces grow almost immediately. Arizona’s workforce has grown by about 5,000 workers since their law was implemented. Thousands more in the future are sure to come, as well. That’s the kind of drastic workforce boost that we need here in South Dakota.
We are constantly looking for opportunities to expand registered apprenticeships in South Dakota. Just last month, the Department of Labor & Regulation awarded four grants to create four apprenticeship pipelines for high schoolers across the state. The four recipients were Bear Butte Gardens for agriculture, Belle Fourche School District for healthcare, Harrisburg School District for agriculture, and Dakota State University for education. Later this week, they’ll announce even more awards.
More and more businesses are realizing the value of these apprenticeship programs. I want to highlight Lemmonmade Butcher Shop in Lemmon, which has incorporated an apprenticeship program to hire and train new staff. They initially hired an employee named Jesse who is now supervising more people going through the program, allowing the owner of the business to take his first ever vacation. That’s making the American dream come true.
Howe Inc. in Sioux Falls has used apprenticeships to build their workforce for decades. When they gave me a tour of their apprenticeship classroom and program, I was impressed. It’s incredible. They already provide apprenticeships in plumbing, fire protection, and HVAC sheetmetal, and they recently worked with the Department of Labor and Regulation to add a mechatronics apprentice program. They are currently in the process of setting up another program for fire sprinkler fitters. Over the years, Howe has used their apprenticeship program to hire more than 60 employees. It has been a total game changer for their workforce. Other companies can seize this opportunity, too.
I want South Dakota businesses to continue to start apprenticeship programs. If you are interested in launching one at your business, reach out to us. And stay tuned for more news about how we’re expanding our apprenticeship program later this year.
South Dakota will continue to attract the careers of the future and address workforce challenges. In the last year, you worked with me to expand Dakota State University’s cyber research capabilities, which will bring 500 six-figure jobs to Sioux Falls. More importantly, it will give our kids and grandkids another reason to pursue the career of their dreams right here in South Dakota. I promised to bring the next big industry to South Dakota. This is it.
In the last year, we also broke ground on the largest economic development project in our state’s history. Gevo’s Net-Zero 1 Site in Lake Preston is the first ever billion-dollar investment in South Dakota. They will literally turn corn into jet fuel, as impossible as that sounds.
What we are doing in South Dakota is reverberating across this country and around the world. We would be growing even more if there weren’t federal mandates preventing companies from coming – and Biden just extended these mandates last week. We are in touch with a company in Canada that wants to move their business to the Black Hills. And I can’t share too many details yet, but we’re very excited.
They are buying property that they haven’t even seen in-person. This family and their business have suffered due to COVID restrictions and vaccine mandates in Canada. Their daughter was even expelled from her university for refusing the vaccine. They are ready to gain back their freedoms. They want to grow their business and improve their quality of life here in our state. The Biden Administration’s vaccine mandates are standing in their way.
We aren’t just bringing new businesses to South Dakota – our existing businesses are growing and thriving. Valley Queen in Milbank broke ground last year on a $200 million expansion that will create an additional 140 jobs for the community. South Dakota’s total milk production has risen 11% in the last year, and that will continue to increase once this facility is completed.
The Governor’s Office of Economic Development facilitated $1.7 billion in new economic investments in South Dakota over the last year, creating 2,400 new jobs. In fact, in my first term, we delivered more economic investment in South Dakota than in the previous 10 years combined. That’s the kind of success you only see in a state where government is limited, personal responsibility is central to everything, and the private sector is unleashed.
Remember, we were the only state to reject the additional elevated unemployment benefits offered by the federal government. Our people kept working, our unemployment rate remained low, our economy remained strong, and new businesses moved here. Now, we have a very healthy unemployment trust fund balance – which gives us the opportunity to cut the unemployment tax for businesses. My Department of Labor will be bringing a bill to revise employer contribution rates to the unemployment trust fund. This will bring an estimated $18 million savings to South Dakota businesses over the next couple of years.
We’re continuing to break records for tourism. It’s no secret that folks have been visiting South Dakota by the millions, and that many of them first heard about us during the pandemic. In 2020, we broke the record for most visitors to South Dakota’s state parks. In 2021, we shattered that record – and broke the record for visitor spending, too.
We don’t have final data yet, but it looks like South Dakota set another record for visitor spending in 2022. Our airport arrivals increased by about 10% over last year. Even with nationwide inflation and increases in gas prices, visitors continue to choose South Dakota. And our economy is reaping the benefits. In fact, tourism revenue decreases the tax burden by $1,000 per South Dakota family. The tourism industry also supports about 57,000 jobs.
This year, the Department of Tourism will launch a dedicated Native American tourism marketing campaign. Beginning in 2023, bus tours will bring both domestic and international visitors to Pine Ridge, Rosebud, Standing Rock, and Milk’s Camp. We will continue to emphasize telling tribal stories. They are a key part of our state’s rich history and heritage, and I’m excited to share that with the world.
People who visit South Dakota also come to hunt and fish. Access to hunting opportunities has never been greater. Since I took office, more than 50,000 private acres have become available for public hunting. 15,000 new habitat acres have been added to promote strong wildlife numbers. Momentum continues to build – our most recent pheasant harvest shows more total birds and birds per-hunter than the 5-year average. And in 2022, we set a record for the most nonresident fishing licenses sold.
Every year, more and more South Dakota youth are participating in our Nest Predator Bounty Program. Youth participants jumped up to 32% of total program participants this year. These kids are discovering a passion for the great outdoors.
When tourists, hunters, and fishermen choose to come to South Dakota, they are not just pursuing big game wildlife or a catch of a lifetime. They are literally pursuing happiness – a break from their day to day lives. Moments with their families and the excitement of new adventures in the great outdoors. They are choosing South Dakota, and visiting us creates memories that will last a lifetime.
PROMOTING STRONGER FAMILIES
We will continue to build stronger families in South Dakota.
Three years ago, we worked together to pass legislation to provide paid family leave for state employees. This gave families the opportunity to bond with newborn and adopted children – and it put us in a better position to attract top talent to our state government. This year, I want to expand that opportunity.
Currently, the state provides paid family leave benefits at 60% of an employee’s salary for 8 weeks. I am proposing that we extend that benefit to 100% of salary for 12 weeks. And this new family leave policy won’t just cover new births or adoptions – it will also cover taking care of a child, spouse, or parent with a serious health condition, or a situation where a spouse is called to active-duty military service.
This will be a tremendous benefit for state employees – but it won’t stop with them. Private sector companies will have the opportunity to be a part of the state’s risk pool, as well. This will make it much cheaper for companies to offer this benefit to their employees. And the more people that buy in, the lower the cost will be for everyone. My budget provides $20 million in grants to incentivize private sector companies to participate for the first few years.
My budget also proposes $1.1 million to help give pregnancy and postpartum care for moms who are Medicaid recipients. Pregnant moms who are at risk of poor birth outcomes will receive intensive care management. This will help moms have a healthy pregnancy – and this care will extend after birth.
Moms who are involved in this program have babies who are less likely to be admitted to the NICU. And after birth, these moms will be able to join the Bright Start program, which you helped provide funding for last year. This proves our commitment to helping moms and families through whatever situations they may face. We will help them and their babies both before birth and after.
And we’ll also help families adopt children who are in need of a loving home. During my time as Governor, I have emphasized adoption as an area where we can improve as a state. And my Life.SD.gov website helps families find resources to help, whether they are adopting or giving a child up for adoption.
I am also recommending up to $25,000 for state employees to cover the cost of adopting a child domestically. Today, we have several state employees with us who have adopted children into their homes. Would you all please stand and be recognized? Thank you for your service to our state – and thank you for providing a loving home for these kids.
Another way to help kids grow up in a loving home is foster care. Two years ago, I launched the “Stronger Families Together” initiative. Before this initiative, we were recruiting fewer than 200 new foster families every year. Now, we’re recruiting more than 300 foster families a year to help. We met our target in year one, and our recruitment contacts are up for year 2! But our foster children face educational challenges as a result of their circumstances.
Today, I am announcing the “Stronger Families Scholarships” proposal, which I will be working with you on to provide a new education opportunity for these kids. Any child in the foster care system will have the opportunity to receive up to $4,000 in a scholarship to help them achieve their full potential, from kindergarten through 12th grade. This money can be used to pay tuition at a private school, pay for tutoring or teaching services, purchase curriculum, pay for standardized tests or AP exams, and more.
There is always more that we can do. Today, more than 100 businesses across the state provide targeted discounts to foster families and children. I love that! And I’d love to see more businesses take up that challenge, too.
I know that one of the biggest challenges that families in South Dakota face today is access to childcare. Families might have to go on a wait list for months. One parent may have to stop working for the time being.
In the coming days, we will be completing an overhaul of our childcare rules and regulations. We’ve been working closely with childcare providers to rewrite these rules in a way that makes sense – while prioritizing the safety of our kids.
We will have also be releasing nearly $40M in federal grants for childcare providers. We held several meetings with providers so that these grants will target exactly what they need – from new technology to startup funds to quality initiatives.
We also heard about their workforce challenges. We are going to help tackle this by making it more attractive to work in the childcare field. Currently, childcare providers struggle to give benefits to their employees. So we will be partnering with the South Dakota Farm Bureau to fix this. Today, we have with us some of the leadership team from Farm Bureau who is helping us make these health benefits possible. Would you please stand and be recognized?
Through all of these efforts, we are making clear that South Dakota prioritizes stronger families.
SECURING SOUTH DAKOTA
We live in the strongest and greatest nation in the history of the world. With that greatness comes unique challenges. But we aren’t afraid of challenges. As President Harry S. Truman famously said, “America was not built on fear. America was built on courage, on imagination, and an unbeatable determination to do the job at hand.”
Perhaps the greatest external challenge facing the United States is the Chinese Communist Party. They are using a popular app called TikTok to gather data on the American people. It’s possible they could be using the app to gather users’ keystrokes – which means the Chinese Communist Party could have access to the financial information of tens of millions of Americans. This is an unacceptable security threat coming from a nation that hates America.
A little over a month ago, I signed an executive order banning TikTok for state government. And in doing so, South Dakota began an important movement. More than 20 states have since taken action. Congress recently passed legislation to reflect this policy for the federal government, too. They all followed our lead. That’s the power of the example that South Dakota is setting for the nation. That’s the responsibility that we all need to take seriously.
Our efforts to combat Communist China didn’t stop there. We are also looking for ways to ensure taxpayer dollars aren’t benefitting Chinese companies or the Chinese Communist Party. And I am working with Senator Tobin and Representative Cammack on legislation to block purchases of South Dakota ag land from nations that hate us.
This legislation will create a board called the Committee on Foreign Investment in the United States – South Dakota, or CFIUS-SD. This new board will include ag experts, national and state security experts, and legal counsel. It will review any purchase, lease, or transfer of South Dakota agriculture land by a foreign person, company, or entity and make its recommendation to the Governor whether the purchase should be approved.
That’s the kind of decisive action that we need. We all saw what happened to our neighbors to the north – where a Chinese affiliate purchased land near critical infrastructure to our nation’s security – we cannot allow that to happen here. We cannot allow Chinese interests to purchase any South Dakota ag land, much less land near any military base or critical state infrastructure. South Dakota will set the example here, too. Other states are already looking at our legislation with plans to replicate it. I look forward to working with you to get it done and keep our people safe.
We are committed to securing our state, and we are committed to honoring the men and women in uniform who make that possible. South Dakota respects law enforcement. We’ve proven that in our actions – not just in our words. We recruited out-of-state law enforcement officers to move to a state where they are respected.
It isn’t just our law enforcement officers who go above and beyond the call of duty. I hear story after story of incredible South Dakotans who step up every day.
Stories like the staff at the Avantara Salem nursing home who brought residents into an inner room when the Derecho hit last spring. They had to physically hold the doors shut with their bare hands to keep them from being ripped off their hinges. And when the storm abated, everything on the other side of that door was gone. Those nursing home employees may have felt like they were just doing their job – but they saved so many lives that day. The staff of this nursing home is here today. Would you all please stand, and remain standing for just a moment.
I want to tell one last story of heroism today. Mark Kock works in construction. He has a wife and 5 kids. One day, he was driving through a torrential downpour when he saw a car flipped on its side in the median. He pulled over, climbed into the flipped vehicle, and found a woman who was in shock from the crash. The car was filling up with water. The woman was hanging by her seatbelt. Mark cut her loose, held her out of the water, calmed her down, and held the car door open above his head until emergency responders could arrive.
Mark is a hero. He was a hero that day. He’s also a hero in uniform. Mark is a Staff Sergeant in the South Dakota Air Guard, and he was driving on his way to drill when he stopped and helped that woman, potentially saving her life. His job in the Guard is to keep our nation safe and protect our Freedoms – but he could have just kept driving that day. He didn’t. He pulled over. He stepped up. Staff Sergeant Kock and his family are here today – would you please stand?
Today, I want to honor both the staff at the Avantara Salem nursing home AND Staff Sergeant Mark Kock with the Governor’s Award for Heroism.
Our state is safer because of men and women who answer the call of duty without being asked. I’m proud to be a South Dakotan because of people like all of you. Thank you for setting an example.
Ladies and gentlemen: that is the State of our State. For four years we have made South Dakota the state where anyone can build their American Dream. We have strengthened families. And we have secured the state. What we have built here over the last four years is exactly what our Founding Fathers envisioned when they created our nation – and the founders of our state who enshrined the phrase, “Under God the People Rule.” And we’re just getting started.
In 1790, less than one year after taking office as the first President of the United States, George Washington delivered the first State of the Union Address. Some people think it was the best State of the Union ever delivered. It was the shortest. President Washington delivered an important point that I think we should all remember today: “The welfare of our country is the great object to which our cares and efforts ought to be directed. I shall derive great satisfaction from a cooperation with you in the pleasing – though arduous – task of ensuring to our fellow citizens the blessings which they have a right to expect from a free, efficient, and equal government.”
That is still our task today: to ensure a free, efficient, and equal government for the people of South Dakota. I look forward to working with all of you to get it done.
God bless you all. And may God continue to bless the great state of South Dakota.