A committee of state lawmakers tasked with reviewing South Dakota’s property tax system on Wednesday approved draft “concepts” in Pierre aimed at improving the efficiency, accuracy and consistency of property tax assessments.
But don’t expect these proposals to have a big impact on property taxes, said Rep. Rep. Trish Ladner, R-Hot Springs, who serves on the committee and is one of the Legislature’s leading advocates for property tax relief.
She said the committee’s focus was narrow, and broader property tax relief proposals will come during the legislative session that starts in January.
“It just doesn’t come from summer study,” Ladner said after Wednesday’s meeting.
She promised to introduce legislation next session that she has been working on for over a year, she said, but declined to elaborate.
The Study committee for Property tax assessment method approved six ideas. Some may end up as legislation, while others are recommendations. The committee has not decided how the concepts will ultimately be implemented.
Here are the six concepts:
- Through legislation or regulation, the Department of Revenue may be required to establish a compliance audit for all county equalization offices to ensure that assessments are in compliance with state laws. The frequency and extent of the audits were not determined.
- A working group would examine a common software system for property valuations and tax assessments. This could streamline processes between counties and save money by not having each county purchase software costing up to $600,000. The task force, made up of local and state officials, will submit an initial report within the first year to the House and Senate tax committees.
- A training platform will be developed for new compensation directors covering assessment manuals and other best practices.
- Legislation will be proposed to clarify that counties can cooperate, collaborate and share data related to property tax assessments. It was made clear that there would be no obligation to do so.
- An educational platform would be developed for members of county boards of equalization, many of whom have little experience with property assessments, according to Sen. Jean Hunhoff, R-Yankton.
- The Department of Revenue will share data on property tax assessments throughout South Dakota with lawmakers to ensure the fairness and efficiency of assessments. The department welcomed the idea.
During previous meetings, the committee examined various issues related to property taxes, such as the increasing burden on homeowners and the complexities surrounding agricultural land assessments. Testimony from county directors of equalization and others emphasized the need for a better and fairer system with concerns about the growing tax burden on homeowners in the face of rising home assessments.
The committee is co-chaired by Sen. Randy Deibert, R-Spearfish, and Rep. Drew Peterson, R-Salem. Peterson said the proposals reflect the committee’s goal of creating a “fair and equitable process” for property taxes in South Dakota. He said the proposals are largely a collaborative effort between the committee, county officials and the Department of Revenue.
“There’s more work to be done that doesn’t apply to appraisal methods, and we intentionally didn’t get into that tax conversation as much as some of us might have liked,” Peterson said. “That doesn’t mean the conversation doesn’t have to be had. And that conversation has to be had that we’ve all identified.”
Peterson said the committee is inviting public comment before sending the recommendations to lawmakers at the Executive Board of the Legislative Assembly meeting in November.
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