People use county roads to get to town to buy booze. People who do stupid things after drinking that booze then use county jails. Counties do not get to tax sales or alcohol to pay for those roads and jails. Towns do.
Why the Legislature so throttles the counties but not the towns escapes me. As the road funding bill has been pared down to reduce the funding counties get to fix their deteriorating roads and bridges, the Legislature is advancing Senate Bill 135, which would allow the towns to impose an additional sales tax for their needs.
The Legislature's willingness to heed town criers while ignoring destitute county commissions seems odd. By itself, however, SB 135 doesn't seem like a terrible idea. If towns have needs, they ought to be able to meet those needs. Local control, yadda yadda.
But then Pat Powers comes tooling along for the Koch Brothers to shout Oh my Mammon! SB 135 increases taxes $150 million! Aaaaaaaahhh!
Please. The press release Pat reads from Americans for Prosperity lives in the La-La Land in which its Koch-sipping serfs need to make it look like they are busy. "If every city in South Dakota participated, it would mean more than $150 million in new taxes." Sure. And if every city in South Dakota participated, that would mean every city in South Dakota apparently has unmet needs, and a majority of voters in every city in South Dakota agree that their city commissioners are making wise taxation decisions. That's how democracy works... but as we know, Americans for Prosperity has a problem with democracy. They thus must blow up local control as an evil new tax and stand in the way of local governments meeting local needs.
Americans for Prosperity—remember, they're not for the collective prosperity, just the prosperity of the 1%.
Sales taxes are by definition a regressive tax. There is a disproportiate impact to the lowest earners and therefore has less of an impact to the 1% and a much more significant impact to those at the bottom of the wage scale who are forced to pay the higher tax on everything they purchase including food and clothing.
Some towns may very well be underfunded, but there has to be a better way of funding them than higher sales taxes. Besides - we know from experience if you give governments the option to raised more taxes more times than not they will jump at the opportunity. This means even some towns that don't need it (Sioux Falls for example) will find a reason to add the extra penny to fund non-essential projects like indoor pools or new indoor tennis courts.
The word disfunction does come to mind.
So after not fixing bridges for a long time it seems that Sioux Falls did not even get a bid on the twelfth street bridge. Did we overlook the roads and bridges so long that the bridge builders all left the state or are they waiting for all the work from the state.
Craig, you hit the nail on the head!!!! Give them the money and they will find a way to spend it or blow it on some want not a need!!!!!!!
Spending local money stimulates the local economy,does it not?
Mike, any money stimulates the local economy!!!!! The only thing is the poor pay the same tax on a loaf of bread and box of milk as the wealthy!!!!!! the wealthy can run to the big towns and spend there money and the poor are usually stuck in the home town to spend there meager earnings!!!
The more well to do can also go across the border to Minnesota and buy clothing and groceries without paying sales tax.
iowa doesn't tax most foods and locally there is a 7 or 8 cent sales tax. I can't remember not paying a sales tax. Small towns in iowa survive somehow. A sales tax isn't the worst thing to come down the pike.
Whats the shocker? Republicans cannot govern, never have and never will. They are opportunists ready to take what little cream there is in South Dakota and leave the skim. The last thing they want is for local control of anything that could disrupt the corruption.
Craig - property taxes are even MORE "regressive" in that the owner of a rental property includes said taxes in their rent. Meaning even people who cannot afford to own property still HAVE TO PAY PROPERTY TAXES. So - what is the only answer to implementing a "non-regressive" tax?? Come on - you can say it - I know you can.
Richard, I'll say it for him, income tax. Needs to happen, problem is, I would expect the republican ruling party to exempt business and the rich, sticking what's left of the middle class like myself with the majority of the bill.
Richard, I'm not opposed to some form of an income tax if it is coupled with reduced sales taxes (food and clothing for starters) and reduced property taxes.
That said, I don't think property taxes are as regressive as sales taxes. Low income earners often qualify for subsidized housing which reduces the amount paid for housing (and has a direct connection to the amount they indirectly pay for property taxes). There was a program to refund some sales taxes on food to low income earners, but I believe it was scrapped after a couple of years when they thought nobody was paying attention.
Also, low income earners tend to rend or purchase smaller more modest properties. Some opt for mobile homes, many find apartments in complexes that don't offer swimming pools or have the best views in town. Some purchase homes, but those homes are modest in size and price. This all results in low income earners paying a smaller amount of their income on property taxes (whether directly or indirectly) than someone who could be considered middle class but purchases a large expensive home.
When it comes to sales taxes, the lower incomes are punished because they pay the same sales tax on a loaf of bread, gallon of milk, and box of Cherrios. Any form of consumption tax disproportionately impacts the lower class because when it comes to things like food and clothing they have to have it just as everyone else does. Yes they can change their shopping habits and choose lower priced items, but the impact remains and is very real.
An extra penny on every dollar may not be much (I know I wouldn't miss it) but it just seems to me that the legislature has this idea that they can solve all of their issues with more taxes yet they never take the time to look to see who is actually being taxed. We have no corporate income tax, we have no business inventory tax, we don't tax advertising, we don't have an income tax... yet we think we should raise taxes on bread and milk even more?
Clearly those in Pierre are not serving the people.
Problem is, counties seem to be squeezing as much as they can out of properties. Minnehaha County jumped my assessed property value by $7,000. I fought it, they agreed to knock it back down. Saturday, I get my card and they decided to increase my assessed value again by $7,000 again. My house is for sale right now. There's no way I'll get what the county says it's worth (we tried for 3 months last year at that price). Looks like I get to go back and fight again.
These guys are raising assessments as much as they can as fast as they can, since they can't increase the levy, without regard to actual market value.
So, yeah, it's a regressive tax; I bought the property for X. I can only sell it for X+A, but the county thinks it's worth X+A,B,and C. So now it's taxed at the latter, despite ability to pay, or actual worth.
Why are counties so strapped for cash? Why is there this struggle? Why do they feel the need to keep getting more money from us citizens and where the heck is it going? My roads aren't any better. The neighborhood isn't any better.
Property taxes can be very regressive. A young couple buying a business or ranch can easily spend a couple million dollars to buy that business on a contract for deed. Upon signing the contract they are not one cent richer than they were the day before but now for every year going forward the have a huge property tax liability. Property taxes should only be used to pay for services that pertain to that property.
@ Wayne: I hear you about the increases. I purchased a home in December and my assessment claims it is worth more than 5% more than what I paid for it which is quite a bump in three months. I tend to believe the market determines the price so I have a hard time believing the value could jump that rapidly... but I question if they even take into account the purchase history. Something to look into.
@ Paul: Not sure I understand your example of what constitutes regressive. If a young couple has the ability to purchase property worth several million, chances are they are already paying property taxes elsewhere. If they don't own property they are still paying those taxes indirectly via any leases or rents they pay. The primary point however is that they have options. If they are middle to upper class they can choose whether to live in a starter home, or buy a much larger, more expensive home. They determine if they wish to invest in business property or land. So they may end up spending less as a percentage of their income on property taxes - but they can also end up spending much more as a percentage depending upon their goals and desires. I'd argue that flexibility means it can either be a regressive tax or a progressive tax depending upon the decisions they make - but most often we find people with larger incomes spend more on property taxes by their own choices.
Someone with a low income doesn't have those options. They may have to live where they can afford it, and with a little luck maybe they can get some subsidized housing. They might end up spending less as a percentage of income on property taxes due to some of the rebate programs we have for low income earners and the elderly. Therefore in most cases, property taxes aren't considered regressive because they operate on somewhat of a sliding scale.
Only other comment I'll make in regards to your post is that I'm not sure I understand the sentence about property taxes only beaused used to pay for services that pertain to that property. I suppose that menas you're ok with paying for Fire departments, snow removal, and road maintenance since they have a direct connection to the property... but what about education? What about county administrative services, jails, Sheriff's office etc? Someone has to pay for those services and we all benefit from them - so what is your proposal to fund them if it won't come from property taxes?
Infrastructure? What the hell is that? Who new that it would need maintenance? https://www.youtube.com/watch?v=Wpzvaqypav8
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