Joshua Haiar/South Dakota Searchlight
PIERRE — A former Noem administration employee told legislators Monday that a politically connected, out-of-state marketing firm seemed predestined for selection to carry out a state advertising campaign.
“It was pretty obvious that was who we would be selecting at the end of this,” said Nate Welch. He was marketing director for the Governor’s Office of Economic Development before he left the office in May.
While much of Monday’s meeting of the Legislature’s Executive Board took place behind closed doors for the stated purpose of protecting confidential information, lawmakers used the public portion of the meeting to scrutinize the controversial selection of Ohio-based Go West Media for Governor Kristi Noem’s Freedom Works Here workforce campaign.
Go West Media is a subsidiary of The Strategy Group, whose CEO Ben Yoho also manages Vivek Ramaswamy’s Republican presidential campaign. Noem is now widely considered to be a potential running mate for Donald Trump in this year’s presidential race.
The workforce campaign, which began in June, showcases Noem portraying high-demand workers in television and social media advertisements, as well as on a NASCAR vehicle, to attract workers to South Dakota.
The Legislature’s Executive Board is empowered by state law to conduct oversight and management analysis of the executive branch.
Board Vice Chairman Sen. Lee Schoenbeck, R-Watertown, highlighted similarities discovered behind closed doors between Go West’s campaign and ideas previously developed by Sioux Falls-based Lawrence & Schiller, suggesting potential intellectual property concerns.
“There is an idea that was clearly stolen,” Schoenbeck said. “And there isn’t anybody with two eyes and a functioning brain that would say Lawrence and Schiller’s idea wasn’t stolen.”
The board asked if the Governor’s Office of Economic Development had investigated that particular issue, and Tim Engel, the lawyer for the office, said it had “not done that sort of investigation.”
A lawmaker asked Welch if stealing ideas and incorporating them into a campaign is normal.
“I’ve never worked with anyone who would have done that,” Welch said.
Schoenbeck said he thinks the board should put the issue to rest because he doesn’t think anything illegal occurred, but said he is still troubled by the Governor’s Office of Economic Development’s actions.
“What’s beyond ridiculous here is the level of connivery and misuse of the process when all you had to do was pick the one you wanted,” Schoenbeck said.
He added it was “ridiculous” for GOED Commissioner Chris Schilken to testify that Go West’s lack of a creative plan in its pitch was normal. Schoenbeck offered similar criticism about Schilken’s testimony that the firm was selected because of its analytics. Schoenbeck said Go West didn’t include any analytics in its proposal.
Sen. Reynold Nesiba, D-Sioux Falls, said the selection process was problematic.
“This doesn’t look like a free, open and transparent process,” Nesiba said. “And I don’t think we would be here today if it were different.”
Rep. Chris Karr, R–Sioux Falls, was frustrated upon learning that Schilken, who testified on behalf of GOED, wasn’t involved in the selection of Go West.
“The letter was sent for me to appear,” Schilken replied.
Karr said later that he wants the board to investigate further and bring in more witnesses.
“We’re talking about a circumvention of the competitive bidding process,” Karr told South Dakota Searchlight.
But Executive Board Chairman Rep. Hugh Bartels, R-Watertown, said the body will not further investigate the issue. He said because the Go West deal is a “personal service contract” rather than a procurement process for items like a vehicle or road construction materials, the Governor’s Office acted within its authority.
“You find someone you like, somebody who knows the industry, knows the goal, has an idea how to get there, knows how to get there, and that’s the one you go with,” Bartels said.
The Freedom Works Here campaign has cost at least $6.5 million.
Investigative reports by Sioux Falls Live first highlighted the links between Noem and the selected Ohio firm, raising questions about the selection process.
The Noem administration has praised the campaign as “the most successful workforce recruitment campaign in state history.” A news release from Noem said the campaign has recruited “Freedom-loving Americans to the state,” and more than 8,000 people have expressed interest in moving to South Dakota.
But some lawmakers have expressed frustration about what they’ve described as a lack of clarity about the campaign’s results.
For example, the Governor’s Office has said “over 2,000 applicants have advanced to the final stages of moving” through the Freedom Works Here campaign. But under questioning from lawmakers last year, administration officials said that’s the number of out-of-state people who have asked for a state-assigned job adviser to help them find work in South Dakota, and the administration does not know how many of those people are directly attributable to the campaign.
Funding for the campaign has come from the Future Fund, which by law is spent at the sole discretion of the governor. It’s funded by fees that employers pay in addition to their unemployment payroll taxes. In 2022, the fund amassed $23 million from over 28,000 employers. This year, Noem has distributed over $30 million from the fund.