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SB 43 Uses Parasite-Killing Tax to Fund SDSU-Minnesota Veterinary Program

Senate Bill 43 is the Board of Regents’ proposal to fund the collaborative rural veterinary medicine program South Dakota State University and the University of Minnesota are planning:

Students in this program, which is often called a 2+2 option, would complete the first two years of courses at South Dakota State and the final two years at UMN’s College of Veterinary Medicine in St. Paul. The first 20-student cohort would start classes at Brookings in August 2021, according to the report reviewed by the Board of Regents.

…Dustin Oedekoven, the South Dakota state veterinarian, has participated in informational meetings on the proposed collaborative program. He sees several positive attributes of the proposal, starting with the benefits for current and future veterinarians.

“This program will offer South Dakota students an opportunity to achieve a professional doctorate degree in veterinary medicine while keeping their educational costs at in-state tuition levels and reducing dependence on loans,” Oedekoven said. “It will emphasize the expertise of South Dakota’s rural veterinarians and will foster natural connections between veterinary students and practitioners that may lead to employment and business partnerships. This concept makes sense for South Dakota, for Minnesota and for the greater region” [Jane Hennings, “Proposed Rural Veterinary Medical Education,” South Dakota State University, 2018.12.12].

SB 43 writes this collaborative program (and any other similar contracts the Regents may come up with) into the statute directing use tax on endoparasiticides and ectoparasiticides toward veterinary education and the State Animal Disease Research and Diagnostic Laboratory.

The SDSU-U of M program would replace a program in which the state pays the difference between resident and non-resident tuition for South Dakotans studying veterinary medicine at Iowa State University. This switch doesn’t save money for South Dakota right out of the gate: according to the SDSU Rural Veterinary Medical Education Report reviewed by the Regents in December, the state will spend less on scholarships but will direct those savings toward the faculty, administration, supplies, and facility expansion SDSU will need to host those first two years of veterinary education. But by investing in this 2+2 program, we’re expanding SDSU’s offerings and making it possible for more students to come pay us tuition, not to mention see first hand how great it is to study and work with sick critters here in beautiful South Dakota.

Giving a few dozen prospective South Dakota veterinarians the chance to get some of their education here at SDSU may not be The Next Big Thing Governor Kristi Noem is hoping someone will come up with during her administration, but it’s a good thing. The Legislature should send Senate Bill 43 without much fuss.

But check one thing—Section 3 makes the following revision to our agricultural exemptions to use tax:

Section 3. That § 10-46-17.5 be amended to read:
10-46-17.5. The use in this state of pesticides Pesticides, as defined in § 38-20A-1 to be used exclusively for agricultural purposes is specifically exempted, are exempt from the tax imposed by this chapter… [Senate Bill 43, Section 3, excerpt, as posted 2019.01.07].

Instead of exempting “the use of pesticides,” SB 43 would exempt “pesticides.” Hmmm… could that mean that, while we won’t tax the pesticides themselves, we will require farmers to pay use tax on the service they receive if their friendly neighborhood applicator comes and sprays their fields for them? Nah… couldn’t be—our legislators wouldn’t try to sneak a tax increase past sharp-eyed Governor Noem.

12 Comments

  1. Donald Pay 2019-01-10 11:54

    Cory, thank you for pointing out this bill. In a state with a large ag industry, this bill should receive some attention, but so far no comments on DFP. This bill is indicative of a lot of problems in South Dakota. Much as one might want to support this program, it seems the funding mechanism is really cockeyed.

    First, the state seems unable to fund, without a gimmick, an educational program required to staff the state with the professionals necessary for one of the state’s biggest industries. Welders for pipelines? No, vets for meat production. The state’s elite have very bad priorities.

    Second, you have pointed out the sneakiness of this gimmick very well, but the real problem is this gimmick is directed at the wrong folks. Why should farmers selling corn to ethanol facilities pay for vets?

    Third, If you are going to tax something, tax the pesticides rather than the services, and do it to accomplish a number of goals. Tax the pesticides based on their toxicity and the problems they create in the environment. The services of mixing and application, though, might be better handled by professionals with the proper certifications and equipment. Those might be better left untaxed, so farmers or applicators aren’t tempted to cut corners and cause more spills or drift than otherwise occur.

    Really, this points up a problem with the tax system. Isn’t education of needed professionals a general responsibility of state government. Why not specify a tax gimmick for educating lawyers, for example? At tax on cockroach traps might be appropriate for that task.

  2. Donald Pay 2019-01-10 13:01

    Oops, my second point may have resulted from an incorrect reading of the bill.

  3. Debbo 2019-01-10 15:04

    I’ve visited the U of M’s veterinary facilities and they’re really wonderful. In addition, the Raptor Center is next door to one of the buildings so if you want to see awesome avians and learn how to care for them, that’s the place.

    The horse facility is fairly new and just beautiful.

    Really should be an excellent plan. The question is the funding. Is the lege trying to do something sneaky? So tiresome. Just be up front about the whole thing.

  4. Cory Allen Heidelberger 2019-01-10 19:05

    On that second point, Donald: are we talking about the tax that applies to chemicals used to fight parasites in livestock?

    It does still seem gimmicky, though: do we really need to identify a specific ag-related tax to fund this program? It seems as unnecessarily contorted and potentially too narrow as funding K-12 education strictly with the sales tax collected on pens and pencils, notebooks, and Elmer’s Glue.

  5. Debbo 2019-01-10 21:14

    Yes. There are 3-4 buildings.

  6. grudznick 2019-01-10 21:55

    Mr. H, a fellow like you probably already knows how this Animal Disease Research and Diagnostic Laboratory outfit, which no doubt is a fine cluster of buildings with a nicely coiffed lawn, operates and how the taxes on the excising of such services like spraying weed spray and such on weeds is already taxed. Do you only ask such strange questions because you haven’t run the math or you don’t understand the law bills or because you just enjoy have grudznick best you in the debates?

  7. grudznick 2019-01-10 21:57

    Also, as bad as it is having to send our kids to Minnesota for this schooling, is that not a huge improvement over having to send them to Iowa? That’s a no-brainer for our legislatures.

  8. Cory Allen Heidelberger Post author | 2019-01-12 16:56

    Lovely St. Paul campus: first time I saw (and smelled!) it, that campus reminded me of SDSU. Plus, great access to the Minnesota State Fair!

  9. Debbo 2019-01-12 21:39

    Yup. It’s a beautiful site and sight.

  10. mike from iowa 2019-01-13 08:20

    Farmers using Monsanto herbicides should have no worries about drift. Monsanto can just sue the damaged party for stealing protected technology. It has been done numerous times when it comes to Monsanto registered genetics infecting organic crops, has it not?

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