The Honorable Matthew J.W. Michels
Speaker of the House
500 East Capitol Avenue
Pierre, SD 57501-5070
Re: House Bill 1110
Dear Speaker Michels and Members of the House:
I herewith return House Bill 1110 and, pursuant to Article IV, Section 4, of the South Dakota
I hereby veto the same. The bill is entitled, "An Act to provide compensation to certain retailers for collecting and remitting the sales tax after a certain threshold is met."
Most bills need only one floor vote in each body of the legislature to pass. It took eight votes in
the South Dakota State Senate and the South Dakota House of Representatives for the concepts
in this bill to finally pass. The reluctance was caused by flaws that still exist in the bill.
This bill takes $4.8 million of taxes collected and diverts them from future property tax
reductions and possible increases in state aid to local schools. It is triggered at a time yet
unknown in the future by events outside the control of the legislature. At whatever time that
might be, and for every year thereafter, state revenues available for additional property tax relief,
additional state aid to local schools or other legislatively determined programs would be reduced
by at least $3.3 million. City and town revenues would be reduced by at least $1.5 million.
At some point in the future, when the state has stable and ongoing revenue increases from the
Streamlined Sales Tax Initiative or from other sources, tax reductions or benefits for many more
taxpayers than just this one select group should be considered by the legislature at that time.
A $4.8 million reduction in state and local revenues should not be forwardly mandated by this
legislature. Future legislatures should have the option to make those determinations when
additional ongoing revenues are available.
I respectfully request that you concur with my veto of HB 1110.
M. Michael Rounds