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August General Fund Receipts Droop 2.2% from Last Year

Posted 2017-09-18 05:59 by Cory Allen Heidelberger 14 Comments
More people bought tattoos and tacky shirts in Sturgis last month, but Rally sales didn’t lift the rest of the state. According to the Legislative Research Council’s August revenue report, August sales tax receipts were down 1.3% from last year and 6.3% below the Legislature’s budget target.

State General Fund Receipts, LRC August revenue report, 2017.09.11.

We collected $5.6 million less sales tax than the Legislature figured we needed. Luckily, we collected $4.0 million more in sales during our better-than-expected July, which leaves us mixed on sales tax for the first two months of the year: up 2.2% from last year but 0.90% below this year’s target.

Contractor’s excise tax was also off target. Over the last two months construction has underperformed last year’s all-time high and this year’s budget assumptions, leaving us with $2.2 million less in contractor’s excise tax than the Legislature budgeted for.

State alcohol taxes are a minor portion of the budget, less than half a million dollars a month, but it’s notable that wholesale alcohol collections dropped 3.0% and beverage tax collections dropped 9.1% in August compared to last year. The rest of us apparently watered down the Rally surge.

State General Fund Receipts, July–August 2017, revenue report, 2017.09.11.

Two months in, total general fund receipts are down 1.58%—$4.6 million—below our budget target. If we stay on this drooping tax curve, the Legislature will have to plug a $28-million hole in the state budget.

Sales and use tax monthly revenue, July–August 2017, with subsequent targets, revenue report, 2017.09.11.
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Tags: alcohol | budget | construction | economy | sales tax | South Dakota
Do Employers Really Need to Test New Hires for Drugs?

Posted 2017-05-11 07:01 by Cory Allen Heidelberger 30 Comments
And if so, why not test for alcohol?

Scott Ehrisman watches Sioux Falls banker Dana Dykhouse bemoan the rising rate (now 25%) at which job applicants fail First Premier Bank’s drug test and suggests that Dykhouse could attract a better class of applicants by paying better wages.

I suggest that Dykhouse could overcome his problem by forgoing probes of prospective employees’ private lives and fluids and focusing instead on visible, practical signs of inability to perform the job. If an applicant’s speech is slurred or erratic, if the applicant appears tired or agitated to the point of distraction, if the applicant can’t answer questions logically or type up a letter or spreadsheet without mistakes, don’t hire the applicant. If the applicant can stride confidently into the interview, shake the boss’s hand, pay attention, and pass practical tests—like teaching applicants delivering a practice algebra lesson—then what does it matter to the employer if the employee vacations in Denver and ingests some herbal remedies?

If employees’ private, off-clock behavior does matter enough to justify bosses’ demanding cups of their urine, then why don’t bosses also test for alcohol and ban employees who drink? A 2006 study found that 15% of workers reported drinking alcohol before coming to work, drank at work, or were under the influence or hungover at work at least once during the year; only 3% engaged in similar behavior with illegal drugs. Alcohol is involved in 40% of motor vehicle fatalities and pedestrian deaths. Alcohol is responsible for about half of trauma deaths and nonfatal injuries. Alcohol costs the U.S. economy $249 billion a year, while illegal drugs nick $193 billion. (Tobacco racks up $300 billion in economic costs, so shall we test for smoking, too?)

Alcohol abuse is more widespread and damaging than use of marijuana and other drugs, yet First Premier Bank isn’t breaking out the breathalyzers. CEO Dykhouse can have an adult beverage or two in the luxury suite at his SDSU stadium, and as long as he can walk into the office unaided on Monday and add $2 million and $2 million to get a $4-million tax break, no one will question his fitness for work, let alone demand a whiff of his pee.

Alcohol and drug use affect job performance. So do any number of other behaviors and private issues about which employers have no business asking. If applicants can provide solid résumés and straight answers, hire ’em. If they can consistently perform the work, keep ’em. If they come in late or miss too many days or make too many mistakes, fire ’em. Good managers don’t need cups of pee to build and maintain a good workforce.
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Tags: alcohol | drugs | labor | privacy
Whiteclay Stores Can’t Sell Alcohol Unless They Pay for Cops

Posted 2017-04-21 07:28 by Cory Allen Heidelberger 19 Comments
The Nebraska Liquor Control Commission decided there’s not enough control of alcohol in Whiteclay. This week the commission rejected applications to renew liquor licenses in the reservation border town.

This decision was no moral crusade to save Indians on the dry Pine Ridge Reservation from drunkenness, says commission exec Hobert Rupe:

“They voted to deny the reapplications, because they don’t believe there’s adequate law enforcement present in Whiteclay to ensure compliance with the act,” Rupe says.

…Two weeks ago the commission held an 11-hour evidentiary hearing. Rupe says that did not include moral arguments related to beer sales. He says the scope was adequate policing.

“It’s a very unique situation. It’s an unincorporated village, so there’s no local law enforcement. It’s just from the Sheridan County Sheriff’s Office, which are located 25 miles away. Then compare that,” Rupe says. Whiteclay is within walking distance of 4,000 to 5,000 people on the Pine Ridge Indian Reservation, which is a dry Indian reservation” [Kealey Bultena, “Nebraska Panel Denies Whiteclay Liquor License Applications,” SDPB Radio, 2017.04.19].

There is certainly a moral component to alcohol sales in Whiteclay. Making money by facilitating alcoholism just isn’t right.

But the Nebraska commission is focusing on a practical aspect of the market. Nebraska is able to exploit its proximity to the reservation and reap all the benefits while sticking Pine Ridge and South Dakota with almost all of the costs. If a community is going to engage in business that has predictable law-enforcement costs, that community should budget for those costs. If a town (or, technically, in this case, a cluster of shops that don’t file papers to become a town) has the wherewithal to sell millions of cans of beer each year, it has a duty to pay for a police force to regulate what inevitably happens when people buy and consume those millions of cans of beer. Don’t think of that requirement as a moral argument; think of it as a simple expression of the cost of doing business.

The four Whiteclay stores plan to appeal the denial.
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Tags: alcohol | Pine Ridge | police | Whiteclay
Whiteclay Liquor Licenses up for Review Thursday

Posted 2017-01-04 08:18 by Cory Allen Heidelberger 1 Comment
Across the border in Nebraska, Sheridan County Commissioners take public testimony tomorrow on liquor license applications for the four stores in Whiteclay that keep lots of Pine Ridge residents drunk.

Perhaps South Dakota taxpayers should send a delegation to testify against issuing the licenses:

South Dakota, where nearly all Whiteclay beer is consumed, doesn’t see a penny in tax receipts. Instead, every can consumed by South Dakota residents costs their state $1.59, according to a 2015 report from the Centers for Disease Control and Prevention. Based on a standard-size alcoholic drink, like a shot of whiskey or a 12-ounce beer, the CDC number takes into account all costs attributable to excessive drinking, including those in the health care, law enforcement and criminal justice systems as well as the cost of reduced workplace productivity.

But $1.59 is an average cost to South Dakota for each alcoholic beverage consumed in the state. Whiteclay alcohol is likely to carry an even higher price tag; at 24 ounces, cans of Hurricane and Camo Black Ice are twice the size of a standard beer and four times the alcohol content [Natasha Rausch, “Whiteclay’s Sales Cost Taxpayers Tens of Millions Annually,” Lincoln Journal Star, 2017.01.02].

Ah, externalities. Maybe while we fuss about taxing Internet sales (by the way, Amazon is collecting sales tax for 33 states and D.C. but not us), we should also be looking for a way to get Whiteclay beer sellers to pay South Dakota for the mess their $1.50 24-ounce cans of get-drunk-now make on their neighbors’ lawn.

Or maybe we should enlist the Dakota Access protestors to occupy Whiteclay, assert treaty rights, and help South Dakota and Pine Ridge annex the town. (By the way, on average, it’s 13°F warmer in January in Pine Ridge than up in Fort Yates.)
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Tags: alcohol | Nebraska | Pine Ridge | South Dakota | Whiteclay

2015 Traffic Crash Injuries and Costs Defy Historic Improvements in Highway Safety

Posted 2016-11-30 06:22 by Cory Allen Heidelberger 10 Comments

The Department of Public Safety has released its 2015 Crash Report. In his cover letter, Governor Daugaard chooses to highlight two statistically insignificant pieces of data:

In each Crash Report, there are positive outcomes to share and evidence of challenges that South Dakotans face when it comes to motor vehicle safety.

The overall numbers of drivers in alcohol-involved fatal crashes is up slightly from last year’s report. In 2015, South Dakota had 41 intoxicated drivers who were involved in fatal motor vehicle crashes, compared to 40 in 2014.

However, the good news is the number of drivers and passengers who died while not wearing seatbelts in 2015 is down seven percent from 2014. While that number is still too high, we are happy to see a reverse in the trend [Governor Dennis Daugaard, 2015 Crash Report, Department of Public Safety, November 2016].

I say statistically insignificant because a change from 41 to 40 out of over 17,000 crashes doesn’t tell us much. The non-seatbelted fatalities figures are even smaller, down from 30 to 28. Neither decline represents a real reversal or a trend; both are statistical noise, possibly explained by one vehicle.

If we want numbers that can inform policy, we need to look at bigger numbers that can’t be explained by one motorist misfortune:

	2014	2015	change
reported crashes	17,346	17,791	2.6%
damages ($M)	99	104	5.1%
injuries	5,090	5,525	8.5%
fatalities	136	133	-2.2%
drinking drivers	22.2%	24.6%	10.8%
DUI fatal	47	48	2.1%
DUI injury	583	721	23.7%
economic loss ($M)	402	449	11.7%

We killed fewer people on our highways last year, but we still had more costly wrecks. Injuries jumped 8.5%; alcohol-related injuries jumped 23.7%. Direct property damage rose 5.1%; economic losses 11.7%. All of those unpleasant increases exceed the 2.6% increase in reported crashes, indicating that, for some reason, we got more buck from each bang.

That snapshot suggests some strange danger cropping up in last year’s driving. (Anyone care to speculate on the impact of raising our Interstate speed limit from 75 to 80? Ah, but the Crash Report says that while Interstates represent a larger percentage of fatal crashes than they do of total crashes, they make up a smaller percentage of injury crashes.)

Yet zooming out to the three-decade view shows we’re still no worse off than when we were listening to the Top Gun soundtrack:

Comparing 2015 to 1986, we have 64% more registered vehicles traveling 49% more miles (over 93 million miles, the distance to the sun!) but only 30% more crashes, about the same number of fatal crashes, and fewer injuries.

And over just the last decade, alcohol-related fatalities and injuries have declined 15%, while DUI arrests have declined 18% and DUI convictions have dropped 27%. Whatever we’re doing—more checkpoints, more counseling, sobering up culturally—appears to be deterring drunk driving.

Nonetheless, Gregg Spindler, whose daughter Maegan was killed by a drunk driver in Pickstown in 2013, says the 2015 uptick is part of a rise since our 2011 lows that shows the need for the Legislature to toughen DUI penalties. The 2016 Legislature rebuffed two DUI reforms that Spindler pushed; now he urges the 2017 Legislature to act or perhaps face an initiated measure:

What will happen in 2017? The problem of DUI has only gotten worse since the July 2013 DUI killing of our daughter. We call upon the Governor and Legislature to think about the victims and change DUI laws and practices. Make Vehicular Homicide “a crime of violence”. Implement all the 2013 NTSB recommendations. Mandate 24/7 or ignition interlocks for all DUI convicts. Suspend licenses and impound vehicles upon arrest. Fund local governments that bear the brunt of DUI costs. Stop suspended imposition, allowing offenders to escape any consequences. Stop pandering to defense lawyers. Politicians should heed Psalm 37:27 “Turn from evil and do good; then you will dwell in the land forever.” If politicians choose to fail DUI victims again, perhaps an Initiated Measure can change things [Gregg Spindler, letter to the editor, received 2016.11.29].

I’d suggest the initiative threat may take the pressure off the Legislature to do anything. I’d also suggest that the success this year of Amendment S, the crime victims bill of rights, shows that a DUI reform would pass easily: run just one ad, with Gregg Spindler holding a photo of his daughter, and voters will mark Yes overwhelmingly.

No Whiskey at Brown County Fair

Posted 2016-08-03 13:37 by Cory Allen Heidelberger 3 Comments
Once again, the Brown County Commission has made clear it will not support the sale of whiskey at the Brown County Fair.

Last month the Brown County Commission turned down the fair board’s proposal to sell whiskey in conjunction with the Dacotah Stampede Rodeo when it realized that state law prohibits the county from issuing a liquor license to itself—or, in this case, to the fair board, which is a subunit of the county. The Aberdeen VFW jumped up this week and applied for a liquor license to sell whiskey at the fair rodeo.

The VFW backed fair manager Derek Ricci’s argument that the county could make good money on whiskey sales. There would be no drinking and riding: rodeo goers would be limited to two drinks, available only in a roped-off area away from the grandstand… which seems silly to me, because why would I want to go buy whiskey if I’m going to miss the next big bull ride?

But the commission yesterday declined to make a motion for the VFW’s application, based on concerns expressed by Commissioners Nancy Hanson and Duane Sutton that whiskey doesn’t fit the family theme of the Brown County Fair.

I’m not sure all the beer-drinking the commission allows down in Centennial Village fits the family theme of the fair, either, but the commission made the right call in declining to authorize whiskey sales at the rodeo. As with gambling, the less we base funding for public goods on alcohol sales, the better. If the Brown County Fairgrounds are worth maintaining and improving, we should find the money and the political will to fund that maintenance and improvement without promoting activities with such significant social costs.

Besides, it’s a rodeo, not a booze bash. Take your kids and enjoy the riders!
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Tags: alcohol | Brown County Fair
Whiteclay Grocer Alarmed by Beer-Fueled Crime, Keeps Selling Beer

Posted 2016-07-25 08:42 by Cory Allen Heidelberger 20 Comments
The unincorporated village of Whiteclay, Nebraska, is notorious for selling 3.5 million cans of beer a year to residents of the Pine Ridge Reservation. All that beer available just across the border from a legally dry reservation has fueled public drunkenness and related crime and health problems for decades, but longtime local grocer Lance Moss didn’t decide Whiteclay needed to take some constructive action until his own wife was threatened:

Moss has worked at the store most of his 47 years but something changed when, he says, his wife was accosted.

“The guy was just out in the parking lot trying to get people to give him change,” he said relating the incident. “(My wife) went out and told him to leave and he just went off on her. He followed her into the store. I thought he was going to assault her and I had to get between them.”

Moss took a plea for change to the Sheridan County Commission who forwarded his idea to Nebraska Gov. Pete Ricketts. Ricketts asked Moss to forma local committee of merchants, government leaders, clergy and law enforcement to brainstorm for solutions.

“He asked us just to sit down in an informal way and come up with some suggestions that we might give to the governor for the improvement of conditions in Whiteclay,” said Sheridan County Commissioner James Krotz who serves on the ad hoc committee [Stewart Huntington, “Merchants Want Chaos in Border Town Brought Under Control,” KOTA-TV, 2016.07.20].

Moss wouldn’t need a committee to stop selling beer. His committee’s recommendations do not include getting out of the business of helping Indians get drunk, or apparently even a ban on single-can sales, which has shown some success in reducing alcohol-related trouble in Omaha, Seattle, and elsewhere.

Addiction is a tricky monster: we can say that addicts at least bear some responsibility for the choices that lead them to their addictions, but we can debate the extent to which an addict can simply choose to end the addiction. Those who facilitate and cash in on addiction have no excuse for continuing their behavior: they are making a living by exploiting weak, vulnerable neighbors who need help, not a cheap can of beer.
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Tags: alcohol | business | Pine Ridge | Whiteclay
Oglala Sioux Tribe Council Cancels Public Vote, Pine Ridge Remains Dry

Posted 2016-05-19 06:14 by Cory Allen Heidelberger 37 Comments
Oglala Lakota tribal members were supposed to vote Tuesday on legalizing alcohol on the Pine Ridge Reservation. But on Monday, protestors convinced the Oglala Sioux Tribal council to cancel to referendum:

Of the 18 member council, 14 were present. Nine council representatives voted in favor of the motion to stop the election: Sonia Little Hawk-Weston (Wakpamni District), Marilyn Charging Crow (Eagle Nest District), Collins “CJ” Clifford (Wounded Knee District), Floyd Brings Plenty (Oglala District), Ellen Fills The Pipe (Oglala District), Jackie Siers (Wakpamni District), Blaine Little Thunder (Eagle Nest District), David Pourier (Porcupine District) and James Cross (Pass Creek District).

Four council representatives voted against the motion to stop the election: Ella John Carlow (Pine Ride District), Chauncy Wilson (Medicine Root District), Donn Fire Thunder (LaCreek District), and Craig Dillion (LaCreek District). Patrick Ross (Porcupine District) voted to abstain.

“We, as legislators, spend a majority of our time dealing with social problems, most due to alcohol abuse. I have to be a voice for the children and the generations to come. Legalizing alcohol is not the answer. It’s like encouraging the use of alcohol to make money off our own people who are already fighting this disease,” stated Council Representative Jackie Siers [Natalie Hand, “Oglala Lakota Stop Vote on Alcohol,” Native Sun News, 2016.05.18].

Pine Ridge voters approved repealing the long-standing alcohol ban in August 2013, but concerns about the legitimacy of that public vote led the council to ignore the results. Now Percy White Plume leads 30 protestors on horseback to push the OST council to cancel another public vote and leave the alcohol ban in place. I’m trying to figure out if that’s a victory for people power or not.
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Tags: alcohol | American Indians | democracy | Oglala Sioux Tribe | Pine Ridge | protest | referendum
Legislators Offer Bill to Legalize Campus Alcohol Sales, Despite Regental Caution

Posted 2016-01-31 16:11 by Cory Allen Heidelberger 20 Comments
Last fall, the Board of Regents considered pushing for alcohol sales on campus. Only SDSU expressed great enthusiasm; the other campuses’ reactions ranged from cautious interest to fence-sitting to no interest. The Regents decided not to lobby for the statutory changes necessary to advance on-campus alcohol sales this year, at least not until they’ve done more research and formulated the policies that would guide the sale of cold barley soup at campus sporting events.

Evidently unable to contain SDSU’s enthusiasm, Brookings legislators have filed Senate Bill 102, which would exempt athletic facilities from the ban on alcohol sales on campus and would authorize issuance of alcoholic beverage licenses and special events licenses for Regental events involving “performing arts, intercollegiate athletics, fund raising, a reception, a conference, or an occasional or scheduled event at a facility used for performing arts, intercollegiate athletics, events, or receptions.” Senator Larry Tidemann (R-7/Brookings) and Representative Scott Munsterman (R-7/Brookings) are the prime sponsors; they got Rep. Spencer Hawley (D-7/Brookings) to sign on as well. Some other college-town legislators are also sponsors:
- Aberdeen Senator David Novstrup (R-3), even though Northern told the Regents it is not interested in selling alcohol at campus events;
- Rapid City Senators Terri Haverly (R-35), Bruce Rampelberg (R-30), and Craig Tieszen (R-34) and Rep. Dan Dryden (R-34), although their Hardrockers are too busy engineering nuclear waste containers and secret weapons for Uncle Sam to care much about buying beer at football games;
- Spearfish Rep. Fred Romkema (R-30), whose campus might make money selling beer to bikers who bunk at BHSU during the Sturgis Rally;
- Vermillion Rep. Ray Ring (D-17).
None of Madison’s legislators have signed on as sponsors. We’ll see if Senator Parsley, Rep. Heinemann, or Rep. Wollmann brings a DSU perspective to this bill.

It is interesting to see legislators charging to authorize the Regents to do something that the Regents said they wanted to wait on. Perhaps the chance to stroke alumni and sports fans in an election year with an easy bill that costs taxpayers nothing is too much for some legislators to pass up.
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Tags: 2016 SB 102 | alcohol | Board of Regents | South Dakota State University | state legislature

Counties May Get Quarter of Alcohol Tax, But House State Affairs Nixes County Sales Tax

Posted 2016-01-24 08:06 by Cory Allen Heidelberger 15 Comments

Counties had a good news/bad news week in Pierre. Senate Bill 2, which would give counties a portion of alcohol tax revenues, made it through its first committee hearing, but House Bill 1006, which would have let counties impose sales tax, died in House State Affairs.

Senate Bill 2 did take a couple hits to ensure the state keeps the lion’s share of the alcoholic beverage fund. Senate Local Government cut the counties’ share from one third to one quarter. The committee’s amendment also struck an increase in municipalities’ share from one quarter to one third that might have served to grease a few more ayes. Possibly further weakening the appeal of SB 2 for legislators from more populous districts, Senate Local Government complicated the formula for distributing the counties’ share: where the original bill allotted the county money proportionate to population, SB 2 now allots 75% of that share by population and 25% in equal cuts to every county.

Let’s put that in real dollar terms. The hooch tax generates $16 million total (what? That’s all? See CAFR 2015, p. 26). The counties’ share would be $4 million. The following chart estimates the difference between how much each county would have received under SB 2’s original all-population formula and how much each county (listed in descending population order) would under the amended formula with its equal-share factor:

County	pop (2014 est)	SB 2 orig	SB 2 amend	difference
South Dakota	853,175	$4,000,000	$4,000,000
Minnehaha	182,882	$857,418	$658,215.36	-$199,203.10
Pennington	108,242	$507,479	$395,760.42	-$111,718.12
Lincoln	51,548	$241,676	$196,408.58	-$45,267.51
Brown	38,408	$180,071	$150,204.70	-$29,866.21
Brookings	33,314	$156,188	$132,292.78	-$23,895.57
Codington	27,938	$130,984	$113,389.27	-$17,594.40
Meade	26,951	$126,356	$109,918.71	-$16,437.55
Lawrence	24,657	$115,601	$101,852.37	-$13,748.77
Yankton	22,684	$106,351	$94,914.75	-$11,436.23
Davison	19,885	$93,228	$85,072.69	-$8,155.54
Beadle	18,169	$85,183	$79,038.76	-$6,144.23
Hughes	17,642	$82,712	$77,185.68	-$5,526.54
Union	15,029	$70,462	$67,997.65	-$2,463.86
Oglala Lakota	14,218	$66,659	$65,145.95	-$1,513.30
Clay	13,932	$65,318	$64,140.29	-$1,178.08
Lake	12,368	$57,986	$58,640.83	$655.08
Roberts	10,374	$48,637	$51,629.38	$2,992.23
Butte	10,298	$48,281	$51,362.14	$3,081.31
Todd	9,882	$46,330	$49,899.37	$3,568.90
Charles Mix	9,287	$43,541	$47,807.18	$4,266.29
Custer	8,445	$39,593	$44,846.48	$5,253.19
Turner	8,272	$38,782	$44,238.16	$5,455.97
Grant	7,241	$33,948	$40,612.88	$6,664.39
Hutchinson	7,200	$33,756	$40,468.71	$6,712.45
Bon Homme	7,023	$32,926	$39,846.33	$6,919.91
Fall River	6,845	$32,092	$39,220.43	$7,128.54
Spink	6,598	$30,934	$38,351.91	$7,418.05
Moody	6,367	$29,851	$37,539.65	$7,688.80
Hamlin	5,989	$28,079	$36,210.50	$8,131.85
Dewey	5,662	$26,546	$35,060.68	$8,515.13
McCook	5,649	$26,485	$35,014.97	$8,530.36
Day	5,588	$26,199	$34,800.47	$8,601.86
Tripp	5,512	$25,842	$34,533.24	$8,690.94
Walworth	5,511	$25,838	$34,529.72	$8,692.11
Brule	5,309	$24,891	$33,819.43	$8,928.88
Kingsbury	5,075	$23,793	$32,996.62	$9,203.15
Marshall	4,683	$21,956	$31,618.24	$9,662.61
Deuel	4,312	$20,216	$30,313.70	$10,097.45
Gregory	4,217	$19,771	$29,979.66	$10,208.80
Corson	4,182	$19,607	$29,856.59	$10,249.82
Edmunds	3,983	$18,674	$29,156.85	$10,483.07
Lyman	3,877	$18,177	$28,784.12	$10,607.31
Clark	3,645	$17,089	$27,968.35	$10,879.24
Bennett	3,430	$16,081	$27,212.35	$11,131.24
Hanson	3,419	$16,030	$27,173.67	$11,144.13
Hand	3,345	$15,683	$26,913.46	$11,230.87
Jackson	3,274	$15,350	$26,663.81	$11,314.08
Perkins	3,033	$14,220	$25,816.38	$11,596.56
Stanley	2,983	$13,985	$25,640.57	$11,655.16
Douglas	2,973	$13,939	$25,605.41	$11,666.88
Ziebach	2,826	$13,249	$25,088.52	$11,839.18
Aurora	2,745	$12,870	$24,803.70	$11,934.12
McPherson	2,429	$11,388	$23,692.55	$12,304.50
Faulk	2,357	$11,050	$23,439.38	$12,388.89
Potter	2,340	$10,971	$23,379.60	$12,408.82
Sanborn	2,336	$10,952	$23,365.54	$12,413.51
Miner	2,316	$10,858	$23,295.21	$12,436.95
Mellette	2,100	$9,846	$22,535.70	$12,690.12
Buffalo	2,077	$9,738	$22,454.82	$12,717.08
Jerauld	2,007	$9,410	$22,208.68	$12,799.13
Haakon	1,847	$8,659	$21,646.08	$12,986.66
Sully	1,438	$6,742	$20,207.92	$13,466.05
Hyde	1,396	$6,545	$20,060.24	$13,515.27
Campbell	1,386	$6,498	$20,025.08	$13,526.99
Harding	1,250	$5,860	$19,546.86	$13,686.40
Jones	975	$4,571	$18,579.89	$14,008.72

SB 2’s amended formula reduces the take for our 15 largest counties and increases the take for the other 51. But remember—SB 2 still gives every county more than they are getting now.

One more SB 2 amendment: Senate Local Government decided to mandate that counties spend their alcohol tax share only on “county law enforcement, jails, state’s attorneys, public defenders, and court-appointed attorneys,” exactly the set of costs that counties say justifies their call for a cut of the alcohol action. Interestingly, no such mandate is placed on the cities’ or the state’s use of their shares of the alcohol tax.

Meanwhile, House State Affairs denied counties the potentially more lucrative opportunity to levy a sales tax. House Bill 1006 would have let counties impose up to a 1% sales tax. House State Affairs killed HB 1006 on a 10–2 vote.

Rep. Joshua Klumb (R-20/Mount Vernon) co-sponsored HB 1006. He participated in the 2015 summer study on county government that led to the above proposals. On Tuesday, Rep. Klumb said he sponsored HB 1006 merely for conversation’s sake and opposed letting the counties tax sales:

While he supports the general idea to address county funding, he said the proposed bill is not the solution.

“I don’t support the bill because it would create a patchwork of differing sales tax rates across counties and wouldn’t be doable,” Klumb said Tuesday. “Also, the counties that would need it the most probably don’t even have the sale generation capability to generate much revenue” [Evan Hendershot, “Klumb: County Funding Bill Not the Answer,” Mitchell Daily Republic, 2016.01.19].

Rep. Klumb’s patchwork argument seems stitched together on weak thread. There are more municipalities than counties, and municipalities can impose sales tax rates up to 2%, plus a gross receipts tax, bed and booze tax, and, apparently, rental car tax. The Department of Revenue appears to find that patchwork quite doable.

As for the capacity to generate revenue, let’s look at taxable sales by county for 2015, how much revenue a 1% sales tax could generate for each county, and what percentage sales tax rate each county would have to charge to raise the same amount of revenue it would get under the amended SB 2 booze tax formula (again, I sort by population to show the increasing difficulty smaller counties have in raising revenue):

County	Taxable Sales (2015)	1% sales tax revenue	rate to equal SB2 booze tax share
South Dakota	$16,578,562,287.17	$165,785,622.87	0.02%
Minnehaha	$5,191,342,310.01	$51,913,423.10	0.01%
Pennington	$2,997,833,494.63	$29,978,334.95	0.01%
Lincoln	$428,712,159.06	$4,287,121.59	0.05%
Brown	$890,353,344.53	$8,903,533.45	0.02%
Brookings	$623,369,037.51	$6,233,690.38	0.02%
Codington	$716,625,342.22	$7,166,253.42	0.02%
Meade	$257,224,435.85	$2,572,244.36	0.04%
Lawrence	$528,842,411.00	$5,288,424.11	0.02%
Yankton	$425,042,718.12	$4,250,427.18	0.02%
Davison	$550,128,575.30	$5,501,285.75	0.02%
Beadle	$319,406,477.97	$3,194,064.78	0.02%
Hughes	$376,845,602.56	$3,768,456.03	0.02%
Union	$147,586,125.94	$1,475,861.26	0.05%
Oglala Lakota	$29,820,238.42	$298,202.38	0.22%
Clay	$163,104,470.70	$1,631,044.71	0.04%
Lake	$192,333,949.64	$1,923,339.50	0.03%
Roberts	$82,021,223.21	$820,212.23	0.06%
Butte	$157,733,806.18	$1,577,338.06	0.03%
Todd	$42,693,828.28	$426,938.28	0.12%
Charles Mix	$116,617,757.96	$1,166,177.58	0.04%
Custer	$125,062,680.73	$1,250,626.81	0.04%
Turner	$74,030,295.94	$740,302.96	0.06%
Grant	$130,921,299.81	$1,309,213.00	0.03%
Hutchinson	$104,649,216.83	$1,046,492.17	0.04%
Bon Homme	$51,547,703.09	$515,477.03	0.08%
Fall River	$73,831,476.33	$738,314.76	0.05%
Spink	$72,282,457.20	$722,824.57	0.05%
Moody	$102,227,113.79	$1,022,271.14	0.04%
Hamlin	$48,177,841.83	$481,778.42	0.08%
Dewey	$50,745,952.02	$507,459.52	0.07%
McCook	$56,863,863.44	$568,638.63	0.06%
Day	$81,133,074.69	$811,330.75	0.04%
Tripp	$117,760,879.04	$1,177,608.79	0.03%
Walworth	$114,598,672.49	$1,145,986.72	0.03%
Brule	$100,702,353.27	$1,007,023.53	0.03%
Kingsbury	$58,401,693.17	$584,016.93	0.06%
Marshall	$65,258,578.17	$652,585.78	0.05%
Deuel	$62,498,109.00	$624,981.09	0.05%
Gregory	$60,573,750.67	$605,737.51	0.05%
Corson	$16,979,693.44	$169,796.93	0.18%
Edmunds	$53,135,564.45	$531,355.64	0.05%
Lyman	$39,532,488.46	$395,324.88	0.07%
Clark	$44,851,352.76	$448,513.53	0.06%
Bennett	$33,248,511.34	$332,485.11	0.08%
Hanson	$13,164,455.91	$131,644.56	0.21%
Hand	$44,100,939.98	$441,009.40	0.06%
Jackson	$21,859,000.04	$218,590.00	0.12%
Perkins	$49,554,427.12	$495,544.27	0.05%
Stanley	$65,472,881.41	$654,728.81	0.04%
Douglas	$47,484,366.83	$474,843.67	0.05%
Ziebach	$4,941,442.93	$49,414.43	0.51%
Aurora	$22,734,506.42	$227,345.06	0.11%
McPherson	$24,556,556.58	$245,565.57	0.10%
Faulk	$24,221,438.27	$242,214.38	0.10%
Potter	$36,112,601.67	$361,126.02	0.06%
Sanborn	$21,162,642.35	$211,626.42	0.11%
Miner	$22,357,131.15	$223,571.31	0.10%
Mellette	$6,411,058.70	$64,110.59	0.35%
Buffalo	$6,011,610.08	$60,116.10	0.37%
Jerauld	$27,543,214.84	$275,432.15	0.08%
Haakon	$46,777,092.22	$467,770.92	0.05%
Sully	$25,681,077.30	$256,810.77	0.08%
Hyde	$29,775,586.02	$297,755.86	0.07%
Campbell	$18,327,409.85	$183,274.10	0.11%
Harding	$12,453,522.30	$124,535.22	0.16%
Jones	$31,207,394.15	$312,073.94	0.06%

Ziebach County, which had the lowest taxable sales in South Dakota in 2015, is levying property taxes of $774,000 this year. A 1% sales tax even on their meager taxable sales base would give them another $49,000, a 6% increase, and twice as much as they will get from SB 2’s hooch tax share. I don’t think our friends in Dupree would sneeze at that revenue.

Bennett County, which has struggled to pay its bulls on a patchwork of taxable and non-taxable property, proposed $1.898 million for its general fund this year. A 1% sales tax would put $332,000 more at their disposal, a boost of more than 17%. That would fill a lot of potholes.

Statewide, 54 counties have the taxable sales base to generate ten times as much revenue with a 1% sales tax as they would get from SB 2.

On his interim committee’s own bill, Rep. Klumb appears to lack both imagination and spreadsheets. The data show that every county would get a great boost (in most cases, a much greater boost) from a 1% sales tax than they will from their SB 2 share of the alcohol tax. Every bit helps, but Rep. Klumb doesn’t appear to want to help the counties very much.

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