An option offering flexibility for schools to offset the rising healthcare costs failed to gain traction in the Senate Taxation committee.

 

Committee members voted 5-2 to kill House Bill 1218, which would have authorized a school district to use certain tax levies for pension and health insurance purposes.

 

ASBSD supported the bill.

 

“(School districts) just don’t have a lot of places to go,” ASBSD Executive Director Wade Pogany testified. “Our healthcare costs are rising. (The bill) gives us some flexibility.”

 

The bill would not increase the current levy, but would keep it at $0.30 per $1,000 of valuation.

 

“(The bill) does not reflect a tax increase,” Rep. Brock Greenfield said in his testimony supporting the bill. “Further burden is not placed on the taxpayer.”

 

South Dakota Large School Group Lobbyist Dianna Miller said the bill “eroded” the purpose of the levy. She said all twelve districts that made up her group opposed the bill.

 

“It will end up being increased taxes for people,” Miller said.

 

Similar to her testimony in opposition of the bill when it appeared before the House Taxation committee, Miller suggested districts could seek opt-outs to help with increasing healthcare costs.

 

HB 1218 sponsor, Rep. Kyle Schoenfish, testified the bill could “possibly delay or reduce opt-outs” in school districts.

 

“Passing this bill isn’t going to be the cause of (school districts) raising their taxes,” Rep. Schoenfish said.

 

Senator Jeff Monroe noted growing healthcare costs are difficult for schools to stay ahead of.

 

“There’s no way the income of the schools has the ability to keep up with (healthcare costs),” Sen. Monroe said.

 

Pogany disagreed with the idea that opt-outs would solve the problem of increasing costs.

 

“Every school district is in some form of need,” Pogany said. “If (HB 1218) isn’t the answer, then you gotta tell me where to go because opt-outs aren’t the answer.”

 

For updates from legislative session, check the ASBSD Blog and Bill Tracker page.