Hotels Tied to Kristi Noem Crony Got Millions in State COVID Cash
A big-time donor’s company and her own family’s businesses collected grants, too.
A hotel group tied to South Dakota Gov. Kristi Noem’s campaign chair pulled in millions of dollars from her COVID-19 grant program—the latest case of those close to the Republican benefiting from the federally funded initiative.
Analyzing records compiled by the Sioux Falls Argus Leader, The Daily Beast determined that hotel owner Regency Midwest Ventures Limited Partnership received a $500,000 award through Noem’s small-business relief effort. Regency Midwest is one of 29 companies listed in the portfolio of private equity firm Bluestem Capital, which belongs to Noem’s campaign chair, former South Dakota Lt. Gov. Steve Kirby.
Kirby apparently does not put much distance between his two roles: the contact number for Kirby listed in Noem’s campaign filing with the South Dakota Secretary of State goes to Bluestem’s office.
Besides the half-million the state gave Regency Midwest, another $1 million—the maximum amount granted under the program—went to Regency Hotel Management, which runs the chain’s properties. Reached for comment, Regency Hotel Management CEO Tom Biegler insisted the ownership entity and the operator are separate companies.
However, Biegler did not respond to repeated follow-up inquiries about how this claim comports with his also being listed in public records as the CEO of Regency Midwest. Regency Hotel Management and Regency Midwest also share an address and multiple executives, and were identified as related companies in filings by the Regency Managed Properties Benefit Trust, their nonprofit health benefit provider. Further, both were incorporated in South Dakota by Robert Thimjon, the CEO of the Ramkota Companies, of which Regency Midwest and Regency Hotel Management are affiliates. Public documents also show that Thimjon owns a limited liability company which serves as general partner, or co-owner and decision-maker, of Regency Midwest.
Ramkota Companies received another $500,000 through Noem’s program, as did another of its subsidiaries, Kelly Midwest Ventures. Three other companies operating under Regency’s WR Restaurants brand, and based out of the same drab complex of one-story office buildings in back of the Best Western Plus Ramkota Hotel in Sioux Falls as the rest of the corporate family, received a combined $843,876.
This politically connected web of companies are not the only entities with connections to Noem to have won grants from the relief program that the governor devised last fall to spend money the state had received from Washington, D.C. under the Coronavirus Aid, Relief, and Economic Security, or CARES, Act. Earlier this month, news emerged that companies belonging to the governor’s relatives had received $600,000 in pandemic assistance from the state. Shortly afterward, South Dakota Public Broadcasting discovered that a hospitality consortium where her commissioner of economic development serves as vice president received multiple awards totaling almost $3.6 million.
Further, The Daily Beast found the state had channeled $1.5 million in aid to Shawn Gengerke and his agricultural equipment company. Gengerke and his family are among the governor’s largest non-corporate, non-political action committee donors, having given her campaign at least $16,000 since 2018. Gengerke did not answer repeated requests for comment.
Noem’s office would not respond to questions about Gengerke or the Regency/Ramkota companies. Instead it sent a note asserting that no entity in which the governor held a stake had received any assistance, and pointing out that the state had contracted a private consulting firm to consider grant applications.
Kirby did not reply to repeated requests for comment from The Daily Beast. The businessman held the state’s lieutenant governorship between 1993 and 1995, but he saw Bluestem’s investments wreck his bid for South Dakota’s highest office in 2002. One of his opponents assailed him for Bluestem’s holdings in Collagenesis, a Massachusetts firm that harvested skin from dead bodies for cosmetic surgeries. That history haunted him again when he weighed a bid for Senate in 2008.
Kirby did not stay away from South Dakota affairs long. In 2013, the state legislature appointed him to the South Dakota Investment Council, which oversees the multibillion-dollar public pension system.
In 2018, he chaired Noem’s successful bid for governor. Her campaign used properties belonging to Regency Midwest Ventures for a meet-and-greet, a town hall, and at least one campaign rally. The company’s hotels were also the site of the GOP state nominating convention, her debate against primary rival Marty Jackley, and Noem’s inaugural ball. In office, she has held multiple events at the Ramkota in the state capital of Pierre, another Regency Midwest venue. However, it appears various state agencies have used this location for years, predating Noem’s tenure in the governor’s mansion.
Last September, Regency’s Arrowwood Resort in the town of Cedar Shore shared a defiant video by Noem, in which she declared hunting a solution to COVID-19.
Hospitality and tourism are major industries in South Dakota, and suffered greatly as a consequence of the COVID-19 pandemic. Regency Hotel Management told the Argus Leader earlier this month that it had seen occupancy crash by 60 percent and had laid off 80 percent of its staff. Noem’s program spilled out millions on companies operating in the sector, though only one seemed to get a comparable award to the Regency/Ramkota firms and those linked to her economic development commissioner: the Lester Hospitality group, which received a total of $2,025,375.36.
The Regency/Ramkota companies also received millions in low-interest loans via the federal Paycheck Protection Program, which has similarly aced scrutiny for its awards to firms tied to political insiders.