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Housing authority rule to allow airport infrastructure loans up to $15 million moves forward despite constitutional and appropriation objections
Summary
The South Dakota Housing Development Authority presented rules implementing Senate Bill 76 to allow loans of up to $15 million (2% interest, 20-year amortization, unsecured) for airport infrastructure in MSAs of at least 125,000; the committee approved the rulemaking process by a 4-2 vote amid objections that the change re-purposes housing funds and may have required a two-thirds legislative vote.
Chaz Olsen, executive director of the South Dakota Housing Development Authority, presented new rules to implement Senate Bill 76, which authorizes loans for airport infrastructure from the Housing Infrastructure Fund for airports with scheduled air service in metropolitan statistical areas of at least 125,000 population.
Olsen summarized SB 76's loan terms as presented in the legislative language: loans may not exceed $15,000,000, carry a 2% interest rate, be amortized over 20 years with annual payments back to the housing infrastructure fund, and be unsecured. Olsen said rule drafts add definitions, prescribe an application form and evaluation criteria, and state that approved applicants will enter written agreements for funding.
Julie Johnson, representing Homes for South Dakota, testified in support and urged the committee to preserve the fund by ensuring loan repayments flow back into the housing infrastructure fund so it remains available for housing projects in the future.
Senator Howard objected, arguing the statute and the housing infrastructure fund exist to support housing projects and that permitting airport loans changes the fund's purpose. "Everything about this fund is for housing," he said, adding that because SB 76 altered purpose and created a new appropriation, it should have required a two-thirds legislative majority. Representative Hanson said he would likewise vote against deeming the rulemaking process complete for similar statutory and appropriation concerns.
Representative DeGroot moved to deem the rulemaking process complete and Senator Melhoff seconded; roll call produced four yeas and two nays and the committee declared the rulemaking process complete.
