Jan. 6, 2021

First Premier Bank, Premier Bankcard and Denny Sanford have contributed $50 million to establish a fund for need-based college scholarships that’s projected to reach $200 million.

It’s the first need-based scholarship offered in South Dakota and will be available to eligible students attending the state’s six public universities along with Augustana University and the University of Sioux Falls.

The amount of money available to each university will be prorated based on enrollment, with allocations ranging from $200,000 to $1.25 million per school annually.

Students receiving the scholarships will be required to work for three years after graduation in South Dakota in any field or pay the money back as though it were a loan.

“This has been talked about for probably 10 years in South Dakota, that there’s a real need, and we’re the only state in the union without a needs-based scholarship,” said Dana Dykhouse, CEO of First Premier Bank.

“There just wasn’t any money for it.”

There is now. Premier and Sanford already have put $50 million in a fund at the South Dakota Community Foundation, with the intent to double their contribution in the next few years, Dykhouse said.

“And we’re going to challenge the Legislature and other philanthropists and other South Dakotans to do the same and put money into this fund.”

Gov. Kristi Noem announced she will ask the Legislature for a matching contribution of $50 million.

The funds donated by Premier will be given as Premier scholarships administered through individual universities based on their allocation.

“We are scholarship donors, not scholarship determiners,” Dykhouse said.

Other businesses that want to contribute can name their own scholarship and designate it for students pursuing certain programs.

“The universities will tell you they have a lot of young people who are Pell Grant-eligible people of modest means, and it might take $1,000 or $2,000, and it doesn’t sound like a large barrier, but they just can’t overcome that little extra it takes to get in school or stay in school,” Dykhouse said.

While the scholarship requires the student to work in South Dakota for three years after graduation, it can be in any job.

The gift will impact higher education in South Dakota “as well as the retention of talented young people in our state for generations,” Gov. Kristi Noem said.

Building on success

Dykhouse points to the Build Dakota program as a template for success in funding higher education.

The fund was established in 2015 and has allowed 1,900 students to graduate debt-free and enter the workforce in high-need industries in South Dakota. The program was created to offer full-ride scholarships to students pursuing technical degrees in high-demand fields.

Sanford contributed $25 million to launch that program, which was matched by the state of South Dakota. The initial five-year commitment ended in 2020. The program now is funded at $8 million annually for the next five years: an additional $2 million annually from Sanford, the state and industry partners, respectively, and $2 million from interest on the endowment.

Since Build Dakota launched, 250 other businesses have partnered to help provide additional scholarships. The endowment has grown to $32 million.

“We see many of them (the graduates) in our market buying homes,” Dykhouse said. “Nineteen-, 20-, 21-year-olds buying a first home. They’re great jobs, and they’re doing really well and helping the economy, and it’s just been a terrific program.”

Premier is backing scholarships at the six public universities along with Augustana and USF “because they’re in our market,” Dykhouse said, adding the program could be expanded to other colleges and universities in the state if there is philanthropic or state backing.

“We’ve got the mechanism set up. For Premier, it’s in our trade area and we’re headquartered in Sioux Falls, and that’s why we’re doing those two schools.”

The organization is “passionate about providing educational opportunities that keep talented individuals in our state, and it’s time to make this happen,” added Miles Beacom, CEO of Premier Bankcard.

The first scholarships will start in the 2022-23 school year. Premier is contributing an additional $5 million for that year.

Students qualify based on a formula that takes the cost of attendance — tuition, fees, room/board, books — less the family income and expected contribution to determine financial need.

They do not have to be South Dakota residents to qualify.

“They can come from any other state, and we hope a lot do because we … have never had more job openings in South Dakota than we have today,” Dykhouse said. “We need people, and hopefully this will attract young people to South Dakota. We know we’re not going to save every young person, but we’ll save as many as we can.”