Navigating the Collision Between Business and Civic Interests in South Dakota

At the heart of every new business project in the state, whether it’s a pipeline or a meatpacking plant, are the people who work to make them happen. Sometimes civic groups stand in opposition with concerns about the impact of business growth and development.

There is controversy in Sioux Falls over Wholestone Food’s proposal to build a new meat plant in the city. The $500 million plant is a target of an opposition group called Citizens for a Sustainable Sioux Falls. He got signatures on a ballot measure asking residents to stop construction.

The proposal has supporters.

Lorin Pankratz is the treasurer of the Sioux Falls Open for Business. It is a group that supports local business interests, including the proposed plant.

“They followed the rules and now somebody comes along and says, ‘well we don’t want that business here, so we were going to try to stop it.’ From our perspective, they followed the rules, they did what they had to do,” Pankratz said “And from a broader perspective – it could be any business.”

Pankratz said the ballot measure could send a message.

“People who want to bring a business or expand an existing business here are looking at this because what if this happens to them? So it has a stifling effect on economic development, if that’s what civic activist groups or people with money want to do,” Pankratz said.

He said those leading the opposition to the new plant are working out of self-interest.

“Their view is not a business view, but a personal view,” Pankratz said. “They immediately started saying ‘Do you want another Smithfield?’ Smithfield stinks. Because maybe it’s too close to where they’re building their big house. This is the most important.”

Citizen opposition groups often focus on environmental concerns or concerns that new businesses will not support a balanced, sustainable economy. Opposition to the proposed plant in Sioux Falls has focused on wastewater treatment, odor, traffic and the impact on future development.

Across the state, in a small office in Rapid City, the Black Hills Clean Water Alliance is working to stop mining in the region. This includes a proposed uranium development in Fall River County.

The effort is Powertech’s Dewey-Burdock project, which will be located northwest of Edgemont near the Wyoming state line.

Dewey-Burdock will use in-situ mining, a process similar to fracking in which water is pumped underground to dissolve uranium deposits.

Lilias Jarding is the executive director of the alliance. She said mining has done more harm than good to the area.

“It left a number of streams in the Black Hills polluted all the way to the Missouri River, it left big holes, it left barren landscapes,” Jarding said. “Mining may have made a lot of money for the people who own the Homestake company and for some miners, but for the general population mining is much less financially rewarding.”

When business leaders say opposition groups can stifle economic development, Jarding has an answer.

“We’re not hostile to business,” Jarding said. “We support the tourism, outdoor recreation and agricultural industries that are the backbone of the state and our economy.”

Jarding said interactions with opposing groups can be “adversarial,” but she says civic groups have an edge over companies.

“We live here. This is where people raise their children and grandchildren,” Jarding said. “Here, people have had rights over the area since time immemorial. That means we have a lot to lose if these companies get their way and get mining and other disruptive projects – and the law is often on our side, too.”

Some of the state’s most controversial projects involve utilities — pipelines and energy facilities that require state permits. They go before the Public Utilities Select Committee.

PUC Chairman Chris Nelson said the controversy is familiar territory for commission members.

“Big electric transmission lines, big wind farms, oil pipelines, carbon dioxide pipelines, before they can be built, they have to get a permit from the PUC,” Nelson said. “And obviously these kinds of projects can be divisive among people in the proposed area.”

Nelson said while the PUC is working on the permits, there are limits to its authority.

“The PUC does not make legislative or populist decisions,” Nelson said. “We don’t set policy. We do not make laws. We are more of an administrative or quasi-judicial body.”

That means allowing debates to defer to state law.

“When we’re working on these difficult issues to resolve, what we’re working against is what’s already established in state law, that’s been put there by the Legislature to protect the people and the environment and the land of the people of South Dakota,” Nelson said.

Nelson is currently running for re-election as a Republican to the three-chairman Public Service Commission. His Democratic challenger is Jeff Barth.

On the same ballot, Sioux Falls voters will also see the question of the city’s proposed meat plant.

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