Thrive response to Auch editorial

In response to some inaccuracies publicly posted on Facebook and printed in The Observer, authored by South Dakota District 18 House of Representative Julie Auch, the leadership of Yankton Thrive and River City Flats believe a response was warranted.

Representative Auch’s original comments are shown below in black type with the highlighted bullet points added to provide you with accurate and truthful information.

Doug Ekeren, Yankton Thrive Board of Director Chair
Rob Stephenson, River City Flats Board President

Questions I’m Raising About Yankton Thrive, River City Flats, and This County Commission Race
By Julie Auch Candidate for Yankton County Commissioner

YANKTON — As a conservative candidate for Yankton County Commissioner, I want taxpayers to see clearly how local leaders spend public money and who benefits from those decisions. That’s why I’m calling attention to the River City Flats apartment project and the role Yankton Thrive plays in it.

River City Flats is a $14.7 million apartment complex going up on Whiting Drive. More housing can help our community, but the way this deal came together raises serious concerns.

Yankton Thrive, our local economic development group, owned the land under this project.
Instead of listing that land for sale or opening it to competitive bids, Thrive gave it to
out-of-town developers for free. The developers did not pay a purchase price or a transfer fee. Thrive took property it acquired and held with taxpayer support and handed it over at no cost.

• The apartment property was a gift FROM Manitou to Yankton Thrive in August 2023 to create multifamily housing units.
• A Request For Proposal was publicly advertised to determine who might be interested in the project. We received 3 responses.
• There were NO taxpayer dollars used in this project.
• This land is included in the Tax Increment District #11 so there are property taxes being paid as a part of holding this land for development. TID #11 was created in July 2022.

Thrive didn’t stop there. It approved a $542,000 grant for River City Flats and agreed to buy up to $700,000 in subordinate notes to help finance construction. In total, Thrive delivered free land, a large cash incentive, and significant financial backing to one private project.
Thrive operates with public support and enjoys tax-exempt status, yet it concentrated a major package of benefits in the hands of a select group of developers.

• The $542,000 grant from Thrive came from funds from the YES4 campaign which had a member driven initiative to create housing solutions. This incentive was necessary to attract a builder willing to build in a floodplain and offer lower rents.
• We had agreed to purchase up to $700,000 in subordinate notes but only had to expend $135,000 due to significant Yankton based interest in the project.

Leadership overlap deepens these concerns. Several people who sit on the River City Flats board also sit on the Yankton Thrive board, and another individual serves as a Thrive liaison. The same insiders who steer “economic development” dollars through Thrive now stand close to a project that receives those dollars. That kind of tight circle doesn’t reflect a fair, open market; it reflects an inside track.

• The River City Flats (RCF) board advertised multiple times in the P&D, on radio and social media. Anyone from South Dakota could be an investor if they were willing to invest a minimum of $15,000.
• No one on the board is receiving compensation for serving on the board and any Thrive board members who are investors in River City Flats have disclosed their position and abstain from voting on River City Flats issues.
• Investing in the project was voluntary and not required of Thrive or River City Flats board members.

Meanwhile, ordinary local businesses face a very different reality. When a small business owner or farmer in Yankton County wants to expand, they buy their own land, pay property taxes, and hire local builders, plumbers, and electricians. They invest their own money and take all the risk. That is true, bottom-up economic development.

• This project was a result of our assisting an existing Yankton business expand their plant and protect the jobs and economic impact in Yankton. Thrive members have expressed a need for additional housing for workforce, so the housing aspect of this project was initiated.

In contrast, Yankton Thrive holds more than 75 tax-exempt properties and chooses who gets land, grants, and financing. Because taxpayers help fund Thrive and local governments exempt its properties from taxes, every sweetheart deal it makes raises
questions about fairness and priorities.

• Thrive currently owns 102 parcels and taxes are paid on 95 of them. The land transferred to RCF project is also paying the full amount of assessed property tax.
• This project has been transparent from the beginning. Starting with the land transfer from Manitou to Yankton Thrive, the RFP process for builder solicitation, multiple public investor meetings which included announcements in the P&D, radio and social media.
• The majority of Thrive’s funding comes from members, individuals and businesses who are willing to invest in Yankton.

Last fall, the City of Yankton voted to send $460,000 of your tax dollars to Yankton Thrive for “economic development.” Shortly afterward, the city raised water and sewer rates for every resident. Families, seniors, and small businesses now pay more every month. You have every right to ask: did your life improve because city leaders handed $460,000 to Thrive, or did your bills simply go up while a few well-connected players benefited?

• Water and wastewater operations for the City of Yankton are called enterprise funds. Each of those funds operates independently and has no connection to the BBB dollars that are utilized for the outside agency allocation. BBB (Bed, Board and Booze) taxes by law have limited uses and cannot not legally be used to support water and wastewater operations. There is ZERO correlation between the $460,000 and increases in utility rates.

I’m running for County Commissioner to change this culture. I will fight for limited, transparent government that refuses to pick winners and losers. I will insist that groups receiving taxpayer money open their books and justify their decisions. And when I vote on zoning, land use, and economic development, I will put taxpayers first, support open competition, and work to restore trust in county government.

• We are glad that citizens have candidates to select from in city, county and state elections. We hope you exercise your right to vote, and will select candidates who understand the issues and make fact-based decisions.