BOX ELDER — A new state law brought a degree of certainty Friday to a situation filled with unknowns for the Douglas School District.
The law, signed by South Dakota Republican Gov. Larry Rhoden, authorizes a $15 million, zero-interest loan to the district from the state’s housing infrastructure fund. The money will help pay for the construction of a third elementary school.
The extra school is needed because the federal government is developing B-21 stealth bombers, and some of them will be stationed at Ellsworth Air Force Base, which neighbors the school district’s Box Elder campus.
The construction and extra personnel needed to accommodate the new planes are expected to grow the base and the surrounding area by thousands of people. But the school district doesn’t know when the planes will arrive.
“We know they’re coming probably in the next three to four years,” said Superintendent Kevin Case, “but we don’t have an exact timeline.”
The district needs a building large enough for 640 students, Case said, which will cost an estimated $62 million. The $15 million loan will help pay for that, and the district anticipates contributing $5 million or more of its own money. The rest will hopefully come from federal funds that South Dakota’s congressional delegates are working to obtain, Case said.
Douglas is uniquely financially hindered by the presence of the vast base, which is not subjected to property taxes. The district gets payments from the federal government to compensate for the lost tax revenue, but Case said it’s not enough to fund a major building project.
Rapid City-area lawmakers have worked for years to win state grant funding for the district. Some other lawmakers opposed the idea, saying it would set a bad precedent and encourage other districts to seek state funding for local projects.
The alternative proposal legislators adopted this year will tap into the state’s Housing Infrastructure Financing Program. The Legislature created it two years ago with state dollars and federal pandemic relief money, to help spark housing development projects across the state.
Half of the $200 million fund was made available as grants, and all of that money has been awarded. The other half was made available as loans, but demand has been low. More than $80 million was still available as recently as December.
Sen. Helene Duhamel, R-Rapid City, sponsored legislation earlier this year that went through several amendments before it finally reached Gov. Rhoden’s desk in the form of a loan from the housing fund. The legislation gives the state Housing Development Authority permission to make the loan, with a repayment period of 20 years.
The district can use the money for any expenses related to the new school’s construction. Under regular program rules, a loan from the fund can only be used for things like roads, sidewalks, or water and sewer lines to support housing developments.
Rhoden signed the bill Friday in the Vandenberg Elementary School gym at Box Elder.
“We’ve talked about this issue for a couple of years now, as legislators well know,” Rhoden said. “And this, I believe, is the right solution to move forward.”
