South Dakota House lawmakers are passing Gov. Larry Rhoden’s bill to temporarily soften property tax burdens.
The governor’s bill, which was also crafted by a working group of legislators this session, does several things. It caps assessment growth at three percent for five years. It also limits the amount of growth taxing districts can capture for five years.
The bill affects counties that are growing faster than the rest of the state — like Minnehaha, Lincoln and counties in the Black Hills.
“Those that aren’t growing, this isn’t going to affect them. What it is, is those that are growing—they’re going to have to look at their budget and what their ask is," said Republican Rep. Leslie Heinemann, R-Flandreau, who worked on the bill meant to bring taxpayers relief.
House Democrats voted in favor of an amendment increasing the amount of growth counties can capture, which narrowly passed. The caucus voted against the bill overall. Rep.Nicole Uhre-Balk says Democrats represent counties that either wouldn’t be affected by the bill, or counties where the growth is really high.
“That concern of capping that will affect our counties and our schools—and also just concern for schools that are growing… just kind of tie their hands. I know there’s the opt out, but for Rapid City Area Schools that’s a really hard challenge. So, that’s one of the reasons why I voted against it.
Uhre-Balk said she would have supported a standalone bill raising the threshold for property tax freezes, which is also include in the legislative package.
House amendments must be approved by the state Senate before it reaches Rhoden’s desk.
Two other proposals to provide property tax relief failed. Attempts to raise the sales tax from 4.2 percent to five percent and put the money raised toward property tax relief also failed.
Some state lawmakers say the problem is spending by the local taxing districts. After the session concludes, an interim task force will meet to study property taxes and conduct a “thorough review” of state and local government spending.
