Cap Outlay compromise bill passed, signed into law

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Cap Outlay compromise bill passed, signed into law

In its final vote, a compromise bill on capital outlay provisions proved to have overwhelming support.


House members passed Senate Bill 170, which revises certain provisions regarding school district capital outlay funds, on a 65-3 vote. Among the four votes it took between two committees and two chambers, the bill only had four “No” votes.


ASBSD supports SB 170, which is a compromise between Gov. Kristi Noem’s office and the educational groups and makes multiple changes to the Capital Outlay fund, including:

  • Amends the annual inflationary growth cap to be set at 3 percent, instead of 3 percent or inflation;
  • Implements an opt-out process for the capital outlay fund with any of the additional revenue raised through the opt-out only allowed to be used for capital outlay purposes and not general fund transferable;
  • Raise the alternative cap on capital outlay to $3,400 per student, up from $2,800 per student;
  • For calendar years 2021, 2022 and 2023, districts impacted by the $3,400 per student cap may transfer to the general fund the amount they had transferred in 2020, but in 2024 will be subject to the 45 percent rule;
  • Beginning with taxes payable in 2021, districts unable to raise $1,400 or less per student can levy up to an amount that would allow them to reach the $1,400 per student levy, but cannot exceed $3 per thousand dollars of valuation.

Rep. Timothy Johns spoke in favor of the bill on the House floor noting it “protects property and taxpayers” and “is meant to address the needs of all of the school districts.”


Rep. Taffy Howard was one of the few to speak against the bill during its legislative process with one of her main contentions being “the burden” it could place on taxpayers.


Rep. Johns reiterated that the bill “does limit (growth) to three percent year” thus ensuring there is a stopgap.


“It’s a compromise bill,” Rep. Johns said, adding it would “meet the partial needs of everyone.”


SB 170 was signed into law by Gov. Kristi Noem.


For updates on everything related to K-12 education, check the ASBSD Blog.

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