An option that may help with the rising health insurance costs school districts are facing may be coming.
On Monday, House Taxation committee members voted 9-6 to pass House Bill 1218, which authorizes a school district to use certain tax levies for pension and health insurance purposes. The bill would not increase the levy, but would keep it at $0.30 per $1,000 of valuation.
ASBSD supports the bill. Executive Director Wade Pogany said the bill gives districts a much needed option to help with health insurance costs.
“They’re (school districts) struggling to find ways to pay for the increasing cost of insurance,” Pogany testified. “(HB 1218) would help them just to give them some flexibility.”
S.D. Large School Group Lobbyist Dianna Miller argued the bill could open the door for additional diversions to be added to the levy, which would take it away from its original purpose of covering teacher pensions.
Miller said the wanted to “protect” the levy and noted that districts had other options, such as seeking an opt-out, to fund increased costs.
In 2013, approximately 44 percent of school districts had already been forced to turn to opt-outs to help offset rising costs and funding cuts.
“They’re (school districts) trying to survive without opt-outs,” Rep. Jim Peterson said. “We’re pushing funding (responsibility) on the local tax payer.”
Peterson was joined in support of the bill by Rep. Bernie Hunhoff, who said schools were “drastically underfunded” and the bill provided them “a little flexibility.”
HB 1218 also passed the House on a 39-31 vote on Wednesday.