STURGIS -- Education funding remains at the top of many discussions about the legislative session, but local lawmakers are looking at options to soften the blow.
District 29 Sen. Larry Rhoden, R-Union Center, Rep. Dean Wink, R-Howes, and Rep. Tom Brunner, R-Nisland, all had opinions about funding education and the state budget during a Saturday morning crackerbarrel in Sturgis.
Rhoden’s legislation, SB152, passed 28-7 on Wednesday, and will now be heard by the House. The bill would protect funds from local property taxes from Gov. Dennis Daugaard’s proposed 10 percent budget cuts. Rhoden’s bill would then make the cuts to state education of 5.6 percent or 6.4 percent, depending on the final version of the bill.
The bill was amended, including an adjustment to the per student allotment in order to keep owner-occupied and commercial property taxes flat.
The original draft of the bill “would have represented a property tax increase, which would have lost votes,” Rhoden said.
Some issues still remain with the bill. Since mill levies are assessed based on the calendar year, if passed, the bill would have left a $12 million hole to fill from June to January. The state operates on a June-to-June fiscal year.
Rhoden said he is amazed at the support his bill has received. Wink said the bill will be discussed in the appropriations committee this week.
Rhoden said he would prefer the bill go to a policy committee, since five of the seven senators who voted against the bill were appropriators. His hope is to have it on the table in a conference committee with proposals from the House and the governor.
A one-cent sales tax increase had also been discussed. Brunner said that all bills instituting a temporary sales tax increase were effectively dead.
Brunner had introduced a bill for a temporary sales tax. Rhoden and Wink had different views on raising sales taxes.
“We may need that somewhere down the line,” Wink said. He pointed out that the Medicaid burden on the state will continue to increase and that the option of a sales tax increase may be needed in years to come.
Rhoden was adamantly against a sales tax increase.
“I do not support taking $160 million -- which is what a one-cent sales tax would amount to -- out of the pockets of the citizens of this state,” Rhoden said.
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He did, however, support instituting sales tax on Internet purchases, which Wink said would bring about $150 million into state coffers.
“When people buy as much on the Internet as I do, you know the state is missing out on a lot of revenue,” Rhoden said.
The difference, for Rhoden, is that people with local businesses generate local dollars that get put back into the state’s economy, whereas Internet purchases that could be made locally are taking money away from the state and local businesses.
When the topic of adopting a state income tax to lessen the burden came up, Brunner summed up the sentiment with a single word: “Ick.”
Wink and Rhoden elaborated.
“It doesn’t have the support statewide to have it today,” Wink said.
Rhoden used other states as an example against a state income tax.
“If you go down the list of states with an income tax and then look at the states in the worst economic trouble, the lists almost coincide,” Rhoden said.
He said that a state income tax wouldn’t save anyone anything but instead would only grow the size of government.
“We’d just be feeding the beast,” Rhoden said.
The crackerbarrel ended with a return to education funding. Rhoden said he believes many of the doomsday scenarios painted by school districts in the state are “grossly exaggerated.” He said that if the situation in a certain district was so dire that education couldn’t be funded, then the people should take it upon themselves to increase local property taxes.
With only about two weeks left in the legislative session, the three legislators all agreed that much work remains.
“Only through citizen participation can we know what’s on your mind,” Wink said. “Nothing’s concrete yet. We’ll try to be as fair and cushion some of this fallout as much as we can.”