House Bill 1143, which would have classified leased residential property as the fourth tax levy, fell one vote short at its Senate Taxation committee hearing this morning.
Committee members voted 4-3 to move HB 1143 to the 41st legislative day following a lengthy discussion on proposed creation of the new tax levy.
“It’s something I think we could look at without this legislation,” Department of Revenue representative Mike Houdyshell testified. Houdyshell testified in opposition of the bill noting the bill had the potential to create a cost shift to the other levies (Agricultural, Owner-occupied and Commercial) or would have required the state to increase its share of funding for state aid.
HB 1143 the leased property levy would be set at $8.62 per $1,000 of taxable valuation and is defined as any single-family unit or structure consisting of two or more family units that is leased or rented. Leased property stands under the commercial levy umbrella.
“We’re more residential than we are business,” Dean Krogman of the S.D. Multi Housing Association said. Krogman said he envisioned the levy would fall somewhere between the commercial ($8.62) and owner occupied ($4.02) in future dollar amount.
DOE Director of Finance Tammy Darnall said the department opposed the bill because it added a tax classification that did not provide a growth measurement for the state or districts to refer to when projecting tax revenues for their budgets.
Darnall also noted HB 1143 conflicted with Senate Bill 28, which is the tax levy bill needed for the local effort proportion to meet the state’s effort for the proposed three percent increase in state aid funding.
Petition bill passed
Senate Local Government committee members voted unanimously to pass House Bill 1018, which would require independent notarization on an election candidate’s nominating petition.
HB 1018 now heads to the Senate floor and if passed without an amendment, would move on to the Governor for signature.
ASBSD is monitoring the bill.
For updates on this bill, as well as others, check the ASBSD blog and bill tracker.