The Immigrant Investor (EB-5) program has become an issue in the U.S. Senate race in South Dakota.
A candidate for the Republican Senate nomination, state Rep. Stace Nelson, has accused the front-runner for the nomination, former GOP Governor Michael Rounds, of being dishonest with the state's voters about corruption in the EB-5 scheme locally.
Rounds, as governor, was deeply involved in the program, using state agencies and state money to support it despite the fact that millions and millions of both investor and state funds were wasted in deals involving a cattle slaughterhouse and a couple of massive dairies. These issues have been the subject of several past CIS blogs including, here and here.
The Republican nomination in South Dakota is an attractive prize, as it is considered highly likely that the primary winner will go to the Senate to replace retiring Democratic Sen. Tim Johnson. The Democratic candidate for the seat is regarded as a long shot, though the possibility of an independent campaign by former Republican Sen. Larry Pressler could complicate matters.
Nelson is very critical about how the Rounds administration handled the program, but is not (or perhaps not yet) attacking the program per se. An interview with Nelson includes this blast:
We are witnessing corruption in South Dakota that is akin to Third World country corruption. We had politicians that happily sold out that state of South Dakota to get access to communist Chinese money. Wasted millions of taxpayer dollars to do so. I don't know of anybody in my field (military intelligence) that would think it was wise or prudent for any elected official to marry South Dakota taxpayer dollars with communist Chinese interests.
I haven't been real impressed with the openness that's come forward so far. They knew that was going on, and they kept this secret for how long. The Rounds people knew about this, they didn't tell people it was ongoing. And he's been very coy about it, and he's been avoiding debates where this would have come forward.
the EB-5 Visa Program:
Most other state governments — except in Vermont — pay scant attention to the EB-5 program, which trades a family-sized set of green card visas for those – usually Chinese nationals — who invest half a million dollars in a DHS-approved, but not guaranteed, investment. Each investment is supposed to produce 10 full-time jobs, but the method of measuring this impact is hazy and subject to manipulation.
The Vermont program (which sends money to ski lodges) has been without controversy, but the bankruptcy of the Northern Beef Packers facility in Aberdeen, S.D., despite lavish funding, has called the whole program into question locally. The mysterious death of Richard Benda, a one-time member of Rounds cabinet and a major player in the EB-5 program locally, gave the program much unwanted attention. The state's attorney general, a Rounds ally, ruled the death a suicide even thought it was accomplished by a shotgun blast to the stomach, an odd way to kill yourself.
Various state and federal investigations regarding EB-5 in South Dakota are underway but nothing has emerged from any of them, yet.