A recent article from South Dakota Searchlight highlighted the clear divide among gubernatorial candidates over a state investment tied to a major business expansion in Brookings. The same kinds of debates are occurring at the legislative, city and county levels. At its core, this is a question about whether South Dakota intends to compete.
The narrative that economic development incentives are “corporate welfare” is false. Anti-growth candidates and officials argue that public dollars are being handed to large companies unfairly, picking winners and losers. While that sounds good in a headline, it falls apart under scrutiny. The surrounding states we regularly compete with — North Dakota, Minnesota, Iowa, Nebraska and Wyoming — all use structured incentives to attract and retain employers. This is not theory; rather, it is standard operating procedure. If South Dakota unilaterally disarms, we do not create fairness, we create a competitive disadvantage for all existing businesses.
Let us take this out of theory and into reality. According to CNBC’s annual Top States for Business rankings, South Dakota slipped to 35th in the nation in 2025; a significant drop from where we stood at our high point of being number one in 2013. This did not happen by accident. Over the past several years, South Dakota has seen an increase in anti-growth rhetoric, questioning incentives, resisting development, and creating uncertainty around whether we want investment.
The market reacts to signals, and so do companies. When the message becomes inconsistent or, worse, hostile to growth, projects do not wait around. They go elsewhere. We can draw a straight line between attitude and outcome.
The Brookings project is exactly what economic development is supposed to look like: a large-scale private capital investment, expansion of an existing employer, immediate and long-term job creation and wage growth, and a significant increase in property tax base and secondary economic activity. The $15 million state participation is not the story; rather, it is the lever that made the project competitive. Without an incentive, that project is just as likely to be in another state.
Let us take the most common anti-growth claims head-on. First, “this is corporate welfare.” Wrong. It is a performance-based investment. Companies earn incentives by investing, building, hiring and operating. No performance equals no benefit.
This is not welfare, it is accountability.
Second, “it is unfair to small businesses.” Wrong. Small businesses benefit directly from increased local spending, increased supply chain demand, workforce attraction and retention, and population stability. A stagnant economy hurts small business far more than a growing one.
Third, “government should not pick winners and losers.” We are not; the market does that. Our job is to ensure South Dakota is in the game when decisions are made. Incentives are one of several tools used nationwide to compete. Opting out does not make us neutral. It makes us irrelevant.
Fourth, “let the free market handle it.” This statement ignores reality. Every competing state is actively shaping outcomes. This is not a passive environment, it is competitive. Refusing to engage is not principled, it is credulous.
Our end goal is the same as it always has been, reasonable growth. The key word here is “reasonable.” We do economic development by supporting performance-based incentives, projects aligned with workforce and infrastructure capacity, a focus on long-term return on investment, transparency and accountability. This approach is not reckless; rather, it yields reasonable growth.
We could look at falling rankings, missed opportunities, and growing skepticism toward development and complain about it. Or we can treat it for what it is: a wake-up call.
What we need now is a consistent message that South Dakota is open for business, serious about growth and willing to compete. If we continue down an anti-growth path, projects will go elsewhere, our population will stagnate or decline, workforce shortages will worsen, property tax pressure will increase, and young people will leave and not come back.
South Dakota did not become successful by accident. It was built through intentional, pro-growth policy and a willingness to compete. Earlier I shared that South Dakota has fallen from the top ranked state for business in 2013 to 35th in 2025. All the states I mentioned that we typically compete with (North Dakota, Minnesota, Iowa, Nebraska and Wyoming) were ranked above us in 2025.
For the benefit of all of us, we need to stop questioning growth and start executing it.
This commentary was written for South Dakota Searchlight, an online news organization by Michael Bockorny, CEO of the Economic Development Professionals Association of South Dakota.
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