- Associated Press - Wednesday, July 20, 2016

SIOUX FALLS, S.D. (AP) - Workforce development efforts in Sioux Falls are being scaled back due to softening sales tax revenues.

The Community Development Department last year made half a million dollars available for a workforce development grant program for schools, nonprofits and businesses that’s aimed at addressing a worker shortage in the city.

About $300,000 was used by six groups, prompting the City Council in its 2016 budget to set aside $350,000 for another grant round. However, City Hall is now scaling back the program to $100,000, and will use the difference to help balance the budget, the Argus Leader newspaper reported (https://argusne.ws/2a8xf0a ).

When the City Council outlined this year’s expenses, it expected sales tax revenues to grow by 6 percent. But through the first five months of this year, revenues are slightly below the same period last year.

“Sales tax is not growing at the rate that we had projected it to so there are . recommendations for reduced spending,” said Mike Gray, the city’s economic development coordinator. “Based on all those positives we got out of the 2015 program . we believe that is the route to go, with that $100,000 worth of funding.”

The program last year resulted in 160 jobs being filled and 215 workers getting advanced job training, according to the city.

Councilwoman Christine Erickson said she sees the need for saving money but that it’s unfortunate workforce development resources are taking a hit.

“It’s a double-edged sword. Our unemployment rate is (2.2) percent, and that’s great, but it also stinks for companies that want to expand because then they look at other communities and we’re losing people,” she said. “There’s clearly a need in our community . and we’re looking at cutting back.”

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Information from: Argus Leader, https://www.argusleader.com

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