
Trickle down of federal cuts could impact funding projects for small towns in South Dakota
May 15—MITCHELL — The spending cuts in the federal government are trickling down to projects and initiatives in the Mitchell area, according to the leader of the District III Planning and Development district.
Speaking to the Davison County Commissioners in a meeting earlier this month, District III Executive Director Lori Cowman spoke about the federal cuts impacting a handful of key programs that the organization helps facilitate for local governments.
One program being cut is the funding of U.S. Department of Commerce Economic Development Administration, or EDA, grants. Cowman said cuts are a concern because the EDA provides a planning grant each year to District III to help support their budget and keep staff.
Cowman pointed out Mitchell has two projects underway that received EDA funding with the assistance of District III.
Those projects included $4 million to the Mitchell School District to go to the construction of an underground cable equipment training facility on the Mitchell Technical College campus, supporting workforce training for students studying electrical programs. That federal money was paired with $3 million in local funds.
The city of Mitchell also received $1 million in grant funding for development of the Lake Mitchell marina plan and surrounding trail system.
Both projects were funded by initiatives that are in the wheelhouse of Republicans in Washington seeking to cut certain government spending. The Mitchell Tech electrical program funding trickled out of a program
geared toward disaster relief and recovery for natural disasters
in 2019, while the Lake Mitchell marina funding came out of the American Rescue Plan package that
allocated $510 million in 2021 to states to help accelerate
the travel, tourism and outdoor recreation sectors out of the Covid-19 pandemic.
The Community Development Block Grant program has also been targeted. It is administered in South Dakota by the Governor's Office of Economic Development but is funded through the U.S. Department of Housing and Urban Development. It frequently helps fund water and sewer system improvements, plus has helped with emergency agency infrastructure updates, with federal funding supplementing the funding from local entities, who cover much of the overall project cost.
"The cuts would not be good for our state," said Cowman, who added that the direct impact on specific programs District III helps with hasn't been detailed. "We hope that they can maintain those. But time will tell."
In 2024, more than $900,000 was directed to Wagner for water system improvements as part of the Highway 46 construction taking place this year. Kimball, Tabor, Canistota and Winner are among other area communities that have received CDBG funding for water or sewer system construction since 2021.
Another program hit hard is the U.S. Department of Agriculture's Regional Food Business Centers program. South Dakota was served by the North Central region, which sought to, according to its website, "connect farmers and businesses together to create new ways of selling and buying food, expanding the amount of food available and the number of people who want to buy it, and strengthening the food systems in the Upper Midwest to address supply chain issues and challenges for small businesses."
Cowman said the program is "no more" because of the cuts and the USDA was hit hard. She said District III had high hopes for the program.
The overall discussion was held in the context of Cowman and District III providing an annual report on what the District III organization has done for Davison County in 2024. The organization, which works with city and county governments in 15 counties in southeastern South Dakota, helped with $33.7 million in Davison County loans, grants or funding proposals in 2024.
The largest shares of that were two Mitchell projects: the $16.8 million state revolving fund loan for the Lake Mitchell dredging project and a $13 million SRF loan for the Mitchell Wastewater Treatment facility phase two.
District III also helps facilitate Governor's House program homes, including nine that were sold in 2024 in Davison County, all to Mitchell.
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