The newest plan to stimulate economic development in the state is going before state lawmakers as the legislative session nears its end. Members of the conference committee reviewed Senate Bill 235 and adopted the amendment proposed Thursday. Representative Bernie Hunhoff says the main difference between Wednesday’s amendment and the one actually accepted deals with transparency of the government. Hunhoff says there’s one portion of the bill that might raise questions as it goes through the chambers.
“There was a little last minute twist put in it where we took $7 million of one-time dollars from the current budget to seed the K-12 programs and the housing programs and all the programs. That was kind of a surprise at the last minute. Many in my party (Democratic party) think we could probably find a better way to use that $7 million right off the bat in what is a tight budget year. That $7 million twist is raising some eyebrows. Senate Bill 235 will pass, but there may be some discussion about that $7 million,” Hunhoff says.
Under Senate Bill 235, Building South Dakota will provide funding for many areas like K-12 education for English as Second Language programs, the South Dakota Housing Opportunity Fund, and infrastructure for roads. The legislation also creates incentives for businesses to develop large projects of 20 million dollars or more in the state. Hunhoff says encouraging big corporations isn’t always the right way to go.
“A lot of Republican and Democratic legislators who really question the value of these large project incentives. If you really study this issue, you can see there’s a big controversy about that nation wide—whether big companies really make long term decisions on where to locate a plant based on large project incentives. But, as majority leader David Lust has said many times, we have to live in the real world, other states are doing this and if we want to be competitive, he thinks and many think we need to do them as well,” he says.
Hunhoff says one positive aspect of the big project incentives is that a portion of those taxes will go toward Building South Dakota and work at grassroots levels. There’s also a trigger in the bill that will stop funding if the state doesn’t have enough revenue to fund important areas like education and Medicaid. Senator Tim Rave says this bill is long awaited and he expects it to pass with little resistance.
“Senate side, we’ve discussed it all along. We kind of came into session and we were very public about it at the very front end of session and said we have to do something for economic development. These discussions amongst members have been going on, well, since January. This is just the culmination of that product. I think the debate on the floor will be minimal. I suspect there could be one or two people that jump up and say it didn’t have a lot of hearings, etcetera etcetera. I think Representative (Bernie) Hunhoff stated it best—this is something we’ve been working on for five years. This is really just a culmination of those efforts and really, just a great package,” Rave says.
Rave says because there are many components to the bill, it will help smaller communities adjust if bigger businesses decide to settle there. He also says the state will see the successes of the legislation through increased tax revenues which will mean more money for education and other areas.