More bait & switch, this time from Pierre

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As I have said in the past, Pierre plays this game every year, tons of optimism about the state budget in the Fall, but once the legislative session hits and schools come a crawling, doom and gloom;

But the sales tax, a barometer of the broader economy, was up 6.2 percent in October from a year ago.

And Dilges is already trying to soften the blow;

Budget conversations among lawmakers have been dominated by state employee raises, K-12 education and Medicaid. But restoring too much money too fast as the economy perks up would defeat the purpose of the “reset button,” Dilges said.

“We have to start thinking about doing business differently than we did before,” he added. “It’s not just a one-year cut, it’s a forever cut. We are going off a new base.”

In other words, an increase in education funding is never going to happen.

If the governor leaves funding untouched in K-12 education and Medicaid, those programs will be worse off in fiscal year 2013 than this year.

That’s because last year, the Legislature — working with the governor’s office — found about $24 million to ease cuts to both. But that money will be gone in fiscal year 2013, leaving education funding 8.6 percent lower than fiscal year 2011 and Medicaid funding 10 percent lower.

And it looks like they will be forcing South Dakotans to vote for a tax increase (5th penny) if they want education and Medicare funded. Not only is it irresponsible and pathetic, it is underhanded. This quote by Assistant Senate Majority Leader Corey Brown, R-Gettysburg says it all;

“Obviously, the hope would be that we would be able to find a way to replace that (education funding) on a more long-term basis,” he said.

Funny how there was zero mention of the $800 million sitting in an investment fund in the entire article. It seems the governor’s office, legislators, the media, the healthcare industry and educators are only giving us one choice this year, an increase in regressive sales taxes. No mention of a corporate income tax, ending tax breaks for foreign industry that comes to our state or tapping into the investment fund. Why? The GOP elite in our state love when the working class and poor pay the lion’s share of taxes especially on bread and milk. Then they wonder why the lines are so long at food pantries. Actually, I don’t think they wonder, they don’t care.

A tax we don’t need makes the November Ballot

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Here we go, a bunch of rich doctors wanting to make sure their bloated payments from Medicare continue have successfully been able to petition the public into increasing the most regressive tax (sales taxes);

Secretary of State Jason Gant today announced that the petitions submitted for an initiated measure to increase South Dakota’s sales tax have passed the certification process, and the issue will be placed on the November 2012 general election ballot.

Doesn’t anyone find it a bit ironic that we would raise taxes on a basic need like food to pay for healthcare and education? If someone can’t afford food, what good is healthcare and education?

This is sad for a number of reasons, but I have two that the public needs to keep in mind;

Initiated Measure 15 would increase the sales tax from 4 percent to 5 percent, with Medicaid providers and K-12 schools sharing about $180 million in new annual revenue.

This only for the first year. After that the legislature can change this formula on the drop of a hat. Does anyone recall the promise of video lottery contributing to education? I’m sorry, call me a cynic bastard, but I know how Pierre works, they see money being given to social programs, they take that money away and funnel it into tax breaks and contracts for their rich and connected buddies, and it is all legal, and I am not even being sarcastic.

The other issue I have with the increase is that money for education already exists. 1) We need to stop giving tax breaks to foreign oil companies because they ‘promise’ to throw us a bone 2) The investment fund, which has $800 million sitting in it could make up for the shortfall, and we would not even have to tap the principal. Right now the interest from that fund goes into the general fund, we could redirect it into education and medicare.

Let’s admit it, our healthcare system is broken. I was having drinks with a friend last night who told me an interesting story about an outpatient procedure his kid had to have. After he received his bill he noticed the surgeon’s fee was about 25% of the bill, but he could not figure out what the other 75% was. So he asked them to provide an itemized invoice. They could not produce it, so he told him he would pay half or see them in court. They accepted his offer, and still never provided the itemized invoice.

Make no mistake, this isn’t about education, this about making sure our bloated healthcare system continues to get funded. I also suspect some Republican lawmakers salivating at the prospect of scooping up this money in the following year.

For once I hope South Dakotans see past this ruse.

[youtube]http://www.youtube.com/watch?v=zqHP8hYAmsE[/youtube]

Poll Shows South Dakota Voters Oppose an Increase in the State Sales Tax

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The Nielson Brothers Polling (NBP) Labor Day Survey shows 56% of South Dakota voters oppose a penny per dollar increase in the state sales tax, while 35% of respondents support it, with 9% undecided. When asked whether, “in light of state budget cuts,” they would support a “one percent sales tax increase,” Democrats oppose it 53% to 39%. Republicans oppose it even more strongly 58% to 32%. Strongest opposition comes from Independent and other party members, 60% to 32%.

Those who self-identify as “liberals” are most likely to support the tax increase, with 56% in favor. A majority of “moderates” also support the increase (51%). However, support drops off among self-identified “conservatives” (31%) and even farther among those who associate themselves with the “tea party” (19%). Each group make up roughly a quarter of the survey respondents.

“The immediate reaction by a majority of respondents to a sales tax increase to alleviate state budget cuts is negative,” said Paul Nielson, partner in Nielson Brothers Polling. “Dedicating new revenues to specific needs, for example education and health care, may increase support,” Nielson added. “In any case, more conservative voters still must be convinced.”

In this Nielson Brothers Polling Labor Day Survey, conducted over a three day period from August 31 to September 2, 729 voters responded to the question about an increase in the state sales tax. It has a margin of error of 3.63 % at a 95% confidence level.

 

Position Statement on Sales Tax Initiative

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Bread for the World-South Dakota • September 13, 2011

Bread for the World-South Dakota neither supports nor opposes the South Dakota ballot initiative to raise the sales tax.  We realize that it raises funds and specifies them for important causes.  However, it also raises the sales tax rate on a number of life’s basic necessities.

We believe that both supporters and opponents can agree that sales tax on groceries should not be raised–regardless of whether the initiative passes and the tax goes up on other things. Even without adding additional tax on food, the initiative would still raise over $160 million for schools and Medicaid – a significant sum.

The ballot initiative, as written, allows a way to keep the increase from being applied to food, because it applies the additional 1% sales tax only to items that are taxed at the 4% state rate. Thus, if the 2012 legislature would take any amount off food, even 1/2%, the food tax would not go up if the petition passes.

In this case, the food tax (state and local sales taxes combined), which currently costs families annually enough to buy 3 weeks worth of food, would not go up to 3-and-a-half weeks. It would keep the tax on a basic can of powdered baby formula below $1.

Even a one-half-percent reduction would be an acknowledgement of the current economic struggle.

This position neither supports nor opposes the initiative.  However, it is our hope that both supporters and opponents of the initiative will agree that keeping the tax on food as low as possible would be helpful for children, families, seniors and nursing homes, for good health, and for the economy.

MY THOTS: Taxing food more to fund healthcare and education seems a bit assbackwards considering good nutrition helps students learn better and contributes to a longer life. But solving problems by going to root seems to easy. Nevermind.

 

This is why funding state government with gambling revenue is a bad idea

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One more reason why video lottery was a stupid idea to begin with;

For the first five months, the Sioux Falls area saw about a 15 percent decrease. But in June, when the new casino opened, the percentage dropped 22 percent to 26 percent.

Well, duh. It’s volatile just like sales taxes. When the economy is down, people spend less money (and rob more). I have often suggested that the state moves to an income tax structure and dumps video lottery and regressive sales taxes (on essentials). But we know who is in charge, don’t we, and that ain’t never gonna happen.

I like Cory’s twist on the concept.