South Dakota Forced to Apologize to Transgender Activists, Pay $300,000

South Dakota Governor Kristi Noem speaks at the Calvin Coolidge Foundation conference at the Library of Congress in Washington, on Feb. 17, 2023. Anna Moneymaker/Getty Images

South Dakota has issued an apology to a transgender advocacy group and must pay $300,000 under an agreement that settles a lawsuit against Gov. Kristi Noem and the state health secretary over a terminated contract.

The Transformation Project, a nonprofit that provides suicide prevention and other services to transgender people in South Dakota, sued Ms. Noem and Secretary of Health Melissa Magstadt last year after the state canceled a contract to hire and train a community health worker to connect members of the LGBT community to health services.

The contract included a $136,000 state-administered federal grant, of which the transgender group received roughly $39,000, according to its attorneys.

Lynne Valenti, South Dakota Deputy Health Secretary, alleged in the contract cancellation letter that the transgender group failed to perform certain contractual obligations.

Attorneys for the group accused Ms. Valenti of having canceled the agreement for political reasons.

U.S. District Judge Karen E. Schreier ruled on Feb. 5 to dismiss the lawsuit after the parties jointly asked for a dismissal after entering into a settlement.

As part of the settlement, South Dakota is required to pay $300,000 and issue a public apology.

“This settlement marks a significant milestone in our ongoing commitment to civil rights advocacy,” Brendan Johnson, lead attorney representing the Transformation Project, said in a statement.

Ms. Noem’s office did not respond to a request for comment on the settlement.

Background

South Dakota’s contract with the Transformation Project was canceled on Dec. 16, 2023, after a reporter from The Daily Signal contacted her office to inquire about it.

“In a statement provided to The Daily Signal, Governor Noem stated ‘South Dakota does not support this organization’s efforts, and state government should not be participating in them,’” the transgender advocacy group wrote in its lawsuit, alleging that the contract cancellation was “based purely on national politics.”

According to the cited report from The Daily Signal, Ms. Noem terminated the contract after a reporter from the news outlet reached out to her office with questions about a “Gender Identity Summit” that South Dakota’s largest employer, Sanford Health, was set to jointly host with the Transformation Project.

The Daily Signal report cited in the complaint noted that the project “celebrates controversial medical interventions for minors and hosts events in which people ritually ‘burn’ their ‘old name or pronouns.’”

Ian Fury, a spokesperson for Ms. Noem, told The Epoch Times in December that the contract had been signed without the governor’s knowledge or approval.

South Dakota Gov. Kristi Noem speaks during the National Rifle Association annual convention at the George R. Brown Convention Center in Houston, Texas, on May 27, 2022. Brandon Bell/Getty Images

The Department of Health, which had originally awarded the contract, said in the cancellation letter that the group had violated contract terms.

The group disputed this claim, leading to the lawsuit, which alleged violations of the Affordable Care Act, which prohibits discrimination in the administration of federal grants.

The transgender advocacy’s attorneys also accused South Dakota of having violated the Equal Protection Clause of the U.S. Constitution.

The lawsuit led to a settlement, under which South Dakota Secretary of Health Melissa Magstadt issued an apology letter, though the state did not have to admit to discrimination.

“On behalf of the State of South Dakota, I apologize that the Transformation Project’s contract was terminated and for treating the Transformation Project differently than other organizations awarded Community Health Worker contracts,” reads the letter, a copy of which was obtained by The Associated Press.

Transformation Project Executive Director Susan Williams said in a statement that she feels vindicated and the settlement sends a “clear and strong” message that “discrimination against transgender people will not be tolerated in South Dakota.”

Noem Sigs Law Banning Trans Surgery for Youth

Ms. Noem, a Republican, has been a vocal opponent of transgender procedures for young people.

In February 2023, she signed the “Help Not Harm” bill into law, banning certain medical and surgical interventions, such as puberty blockers and genital surgery, for minors.

“South Dakota’s kids are our future. With this legislation, we are protecting kids from harmful, permanent medical procedures,” Noem said in a statement. “I will always stand up for the next generation of South Dakotans.”

According to the text of the bill, health care professionals are prohibited from prescribing or administering certain medical and surgical interventions for minors to attempt to alter their appearance or perception of their sex.

These interventions include prescribing drugs to delay puberty and administering hormones in amounts greater than what is typically produced naturally in a healthy individual of the same age and sex, such as testosterone, estrogen, or progesterone.

The law also blocks doctors from performing sterilization surgeries or surgeries that artificially construct genitalia differing from the minor’s sex, and procedures that remove healthy or non-diseased body parts or tissue.

The law prohibits health care providers from violating the ban at risk of having their medical license revoked, and possible legal action.

Caden Pearson contributed to this report.