First capital outlay bill falls, but conversation started on issue

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First capital outlay bill falls, but conversation started on issue

The conversation surrounding solutions for capital outlay got started on Monday (1/27).


Senate Taxation members may have defeated Senate Bill 67, which amends the Capital Outlay levy for sparse school districts, on a 6-1 vote, but they heard from individuals representing schools that a solution was needed and another bill forthcoming. ASBSD was monitoring the bill.


“It’s time though we begin to have a very serious conversation about capital outlay,” ASBSD Executive Director Wade Pogany told committee members. “This is high on their (school boards’) list of concerns.”


At the top of the list of the concerns is the pending implementation of the alternative maximum capital outlay cap set on a per-student basis of $2,800 per-student, set to take effect during the 2020-21 school year. The alternative cap will affect more than one-third of school districts in the state.


School districts also currently face an annual growth cap on capital outlay of 3 percent or inflation, whichever is less; plus, any new construction, that limits what districts can raise for building projects.


“We need to take a step back and take a look at all the pieces,” Pogany said, also noting that there are “bills that are in the works right now.”


ASBSD, SASD and other school groups have held discussions with the Governor’s office and the Department of Education throughout the legislative interim about possible solutions to capital outlay.


“Those discussions continue and that may produce a bill,” Secretary of Education Ben Jones told committee members.


South Dakota Large School Group Lobbyist Dianna Miller added that the negotiations between the two sides are “very serious” but if no consensus is reached the school groups will be bringing a bill of their own.


And while SB 67, which would have allowed sparse school districts to choose between the $2,800 alternative maximum cap or the $3 per thousand dollars of taxable valuation whichever raised more funding, failed to gain traction, it sparked a conversation.


“We’re seeing this (issue) nipping at our heels,” Sen. Jeff Monroe said.


For updates on capital outlay and other legislation related to education, check ASBSD’s Bill Tracker page or Blog page.

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