Gov. Noem Announces Paid Family Leave Proposal

PIERRE, S.D. – Today, Governor Kristi Noem and legislators announced a two-part paid family leave initiative. HB 1151 enhances paid family leave benefits for state employees and provides an affordable opportunity for entities in the private and public sectors to offer the same benefits. SB 154 establishes a $20 million grant program to help private businesses offer these enhanced benefits to their employees. 

“Our families are the heart and soul of South Dakota,” said Governor Noem. “These bills together will strengthen families by extending paid family leave opportunities across the state. It is more important than ever that we continue to build strong families – because stronger families create a stronger South Dakota.”

Three years ago, Governor Noem proposed and signed SB 186 to cover 60% of the cost of family leave for state employees for up to 8 weeks following the birth or adoption of a child. These proposals together expand those opportunities.

The prime sponsors of HB 1151 are Representative Mike Weisgram (R-24) and Senator Jessica Castleberry (R-35). 

“In addition to building stronger families, this legislation puts us in a position to attract top talent to state government,” said Representative Weisgram. “This bill not only extends benefits for new births or adoptions, but also covers instances where a spouse or parent suffers from a serious health condition, or where a spouse is called to active-duty military service. This is exactly what the families of South Dakota deserve.”

HB 1151 allows the Bureau of Human Resources to accept proposals from insurance companies to offer paid family and medical wage replacement coverage for all state employees. This insurance policy will cover 80% of a state’s employee salary for up to 12 weeks in a one-year period for:

-The birth of a child, placement from foster care, or adoption of a child;

-Care for a sick spouse, child, or parent who has a serious health condition; and

-Military exigency which requires leave due to a family member being on active duty.

The remaining 20% of an employee’s salary will be covered by the state through their agency’s budget, so state employees will receive 100% of their salaries while utilizing paid family leave. Private sector businesses, as well as other public sector entities, will be able to join the state’s insurance risk pool and purchase a policy that fits their needs from the state’s insurance provider – and receive a much lower premium rate than they otherwise would.

“As a mother and a business owner, I know how difficult it can be to balance taking care of both your child and your business,” said Senator Castleberry. “This paid family leave initiative takes the pressure off of parents and businesses by giving them the flexibility they so desperately need.” 

The prime sponsors of SB 154 are Senator Tim Reed (R-07) and Rep. Becky Drury (R-32). This bill appropriates $20 million in one-time dollars for grants to encourage businesses to enroll in the paid family leave program and grow the insurance group size.

“We are facing a workforce shortage in every industry across the state,” said Senator Reed. “This grant program will empower private businesses – particularly small businesses – to offer paid family leave benefits to their employees, helping them recruit and retain their workers moving forward.” 

The paid family leave grant program will be capped at $5 million per year for four years. As more businesses join the program, it will save reduce premium costs for both the state and private sector businesses even after the grant program expires. 

“Too many South Dakota families have to make the difficult choice between staying home with a new child and their career. With this legislation, far more South Dakotans won’t have to make that choice,” said Representative Drury. “I am excited that we have the chance to extend this opportunity.”

Together, both of these bills enhance paid family leave in our state and help our small businesses thrive. These pieces of legislation are critical to ensuring that we can continue building stronger families right here in South Dakota. 

Governor Noem discussed this initiative during her State of the State Address. You can find the video of that portion of the speech here.