South Dakota Townships Face Financial Woes After 2019 Floods

January 17, 2020

SIOUX FALLS, S.D. — Townships in South Dakota are facing economic difficulties as 2019 flood repair costs mount.

Townships primarily depend on their taxpayers for funds to repair more than 31,000 miles (50,000 kilometers) of roads while they wait for reimbursements from the Federal Emergency Management Agency. Counties and states can access state and federal programs for money to fix major roadways.

Dustin Leiseth, president of the South Dakota Towns and Townships Association, said townships had received $544,000 from FEMA as of December for disasters that caused around $31.6 million in damages, the Argus Leader reported.

The 2019 Vermillion River flooding in Turner Township washed away 3 miles (5 kilometers) of road, causing an estimated $250,000 in damage. Repairs will cost five times more than the township’s annual $70,000 budget. The township took out a $200,000 bank loan to pay for the repairs while it waits for FEMA funds, township Supervisor Michael Stevens said.

The flood damage has caused more than financial problems. Terry Sletten, the association’s executive director, said townships usually do not have paid employees, which puts pressure on township supervisors because they are the only go-to person for perturbed residents.

“It’s another complicated challenge that supervisors in rural America find themselves in,” she said.

In her budget address in December, Gov. Kristi Noem suggested a new state loan program for cities, counties, townships and tribes to help cover the expenses associated with fixing infrastructure damaged during the 2019 natural disasters while the entities wait to receive the money from FEMA.

“We’ve experienced the largest natural disaster our state has ever seen, and public infrastructure was among the hardest hit,” she said.

Noem’s Infrastructure Disaster Recovery Program is being swiftly implemented and the South Dakota Office of Emergency Management has started accepting applications for the loans.

FEMA repays townships for 75% of public infrastructure repairs, while the state pays for 10% and the township covers 15% of the outstanding costs. The new loan program will advance township money to cover 90% of the costs and the state keeps 75% of the FEMA reimbursement as payment on the loan. The township then has seven years to pay back its 15% portion at a 2% interest rate.

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