PIERRE, S.D. (KELO) — The South Dakota Transportation Commission is fast becoming a lender of last resort to local governments that face funding challenges because of local economic growth.
The commission approved low-interest loans totaling more than $8.1 million on Thursday for road projects proposed by the city of Box Elder and Clark County.
Box Elder is preparing for arrival of B-21 bombers at Ellsworth Air Force Base. A local hotel-management group, LIV Hospitality, wants to build an entertainment center called The Box.
The commission approved a $1,500,000 loan to the city of Box Elder at 1.5% interest to help the city pay for a new route named Hotel Way that would serve the center. The loan would be repaid over 10 years, with a balloon payment at the end.
The commission also approved the state Department of Transportation providing $2.6 million to construct an intersection for the Hotel Way project and to purchase access from the South Dakota Board of Regents.
The commission next approved a $6,620,928 loan to Clark County at 1.5% interest to help fund a $10.9 million rebuild of 17 miles of County Highway 17 that serves a new Riverview LLP dairy. The loan would be repaid over 10 years, with a balloon payment at the end.
Riverview has committed to providing $3.5 million toward the work. That includes a $500,000 local-improvement grant the state Board of Economic Development made to Riverview in 2020 and two infrastructure tax rebates totaling $2.6 million that the economic board awarded.
Clark County Commission chair Wally Knock said SD 25 is the only north-south state highway in the county and is approximately 20 miles from County Highway 17. “The geography lesson is pretty important,” he said.
The stretch of County 17 where the repaving work is proposed is in rough shape, according to Knock. He said there’s currently about two miles of gravel.
Also at the meeting was Riverview general partner Brady Janzen. Riverview has five dairies spread across South Dakota and a sixth is under construction. “Good luck and keep bringing cattle in,” said commissioner Mike Vehle of Mitchell. “We need dairy.”
The department recommended both loans. Discussions took more than two hours, as commissioners asked numerous questions about details of each request.
State Transportation Secretary Joel Jundt suggested the commissioners receive a briefing at a future meeting when they could discuss how they want to handle loan requests.
Even though both requests received unanimous approval from commissioners, the mood Thursday sounded very cautious. Commissioner Don Roby of Watertown seemed to sum it up: “We are in the banking business, whether we want to admit it or not. That bothers me.”