PIERRE, S.D. (SDBA) — One of the downsides of out-of-staters moving to South Dakota with fat wallets from the sale of their homes and buying another home in the state well above market value is hurting long-time homeowners.
That is the contention of the SJR505 sponsor, Republican Sen. Julie Frye-Mueller, and other supporters of the resolution.
However, this morning (Wednesday), the Senate Taxation Committee killed the ballot measure that would have rolled property assessments for all classes of property back to 2020 values. It would also then have limited property tax increases to 1% per year. People who buy property would then pay the higher assessed value.
Frye-Mueller said many South Dakotans, particularly in western South Dakota, are getting taxed out of their long-time homes because of rising valuations from newcomers to the state.
Opponents from the Department of Revenue, the South Dakota Retailers Association, and the South Dakota Chamber of Commerce and Industry argued that if passed, the constitutional amendment would put a huge, unfillable financial hole in local governments’ budgets. They warned that to make up the difference, the state might need to either raise sales and use taxes or, worse, implement an income tax to help subsidize local governments, particularly school districts.
If passed, the state would lose $26.5 billion in taxable valuation, according to the Department of Revenue’s Wendy Semmler.
The vote was 6 to 0 to send the resolution to the 41st day, thus killing it.
