Economic development plan survives split attempt
PIERRE, S.D. (AP) — A comprehensive bipartisan economic development plan intended to help recruit projects to South Dakota survived a Republican lawmaker's attempt to split the bill in five parts Tuesday.
Rep. Stace Nelson, R-Fulton, argued the Building South Dakota Fund measure is full of pork and covers too many unrelated topics. He asked the House to split the measure into five separate bills covering an economic development fund, housing, workforce education, the Governor's Office of Economic Development funding and English education.
"All of these can be separated and stand alone," Nelson said.
Lawmakers shot down that proposal before approving the comprehensive measure 56-13.
Republicans and Democrats worked for the past two months to find a compromise to help level the playing field with other states that do a better job recruiting large projects.
House Republican Leader David Lust of Rapid City said the bill incorporates components important to increasing jobs in South Dakota.
"This is one framework that addresses economic development," Lust said. "They are intertwined, intermingled and interdependent."
Lust chided Nelson for springing his motion on the House at the last minute amid a busy calendar in the last week of the legislative session. Nelson defended the move, saying the bill is a hodgepodge of subject matters and South Dakota law requires legislative issues to be handled individually.
Tension between Lust and Nelson dates back to last year's session, when Nelson and another lawmaker were kicked out of the caucus after accusing Lust and other House GOP leaders of ethics violations.
The Building South Dakota bill now heads back to the Senate, where it likely will be referred to a negotiating committee that will try to work out differences between the House- and Senate-passed versions.
South Dakota currently has no incentive plan because a previous program that refunded construction taxes for large industrial projects was allowed to expire Dec. 31. Voters in November rejected a replacement plan suggested by Gov. Dennis Daugaard.
Supporters of the comprehensive measure say South Dakota often loses out to other states on large projects because of its upfront tax structure. The new plan would refund part or all of the state sales tax paid by projects of more than $20 million that would not have located in South Dakota without such an incentive.
Contractors' excise tax collected on those projects would be placed in the Building South Dakota Fund so the state can reinvest in future projects. The new fund also would get a portion of unclaimed property the state receives from abandoned bank accounts.
House Democratic Leader Bernie Hunhoff of Yankton called the plan a strong bipartisan compromise with more accountability and transparency.
"Education, housing, rural development, all these things do tie together for economic development," Hunhoff said.
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