Final Week of the Legislative Session
By Jason | March 9, 2010
Conference committee is a common combination of words during this final week of the 2010 Legislative Session.
Various bills that originated in the Senate are receiving their final disposition on the floor of the South Dakota House of Representatives.
Today on the floor of the House we debated Senate Bill 65. This bill will delay for five years the production of new license plates. When we delay this production of the license plates a savings of about four million dollars is realized. This money is acquired from the taxpayers. A total of about $156,000 will be sent to Roberts, Day, and Marshall counties over the next three years. Cities and townships will also receive a small amount of funding from this delay in the production of license plates.
Check out Bob Mercer’s Blog Pure Pierre Politics for more information on this issue: http://my605.com/pierrereview/?p=1667
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Weekly Legislative Update: Major Project tax refund gridlock
By Jason | March 4, 2010
Lobbyists, state bureaucrats, the Governors Office, legislators, and staff continue to debate how much contractors’ excise and sales/use tax should be paid by large project companies. The Governors Office organized a bi-partisan meeting with all of the interests dealing with the issue of repealing the tax breaks for major projects involved in energy processing or transportation. Compromise pieces of legislation have been proposed, but the issue still remains that any change in the amount refunded for these taxes will either affect the State Treasury, or a large company who still may be obtaining financing.
I disagree with the results achieved when a contractors’ excise tax is applied. All of us ordinary, private citizens always have to pay the tax when we complete a project on our property, unless of course we do the work with our own hands. For large companies who rely on obtaining financing through Wall Street, the tax being paid upfront can present some challenges and must be a playing factor. However, these large companies are not any different than you or I – we know that we are expected to pay this tax on our projects. For example if we have a remodel performed in our house and we hire a contractor to do the work; we will be required to pay the contractors excise tax on that project.
The difference between an oil pipeline project and a wind farm footprint must be discovered, because each of them contributes differently to our economy in South Dakota. First off, the example of an oil pipeline that is simply “traveling-through” our State is evidence that they only need to use the geographic location of South Dakota and that is reason why they are in our State. This is the reason why I brought HB 1246, which would have required oil pipelines to pay all of their taxes. When dealing with wind energy projects, we must keep in mind that we are limited with transmission capabilities in our state. The presence of contractors’ excise and sales/use taxes at the beginning of a project presents an issue for wind companies, because surrounding states do not all have this hurdle and actually make it very easy for wind energy to start wheeling electricity.
Since wind companies find it difficult to justify the “up-front” taxes on a project, let’s consider the possibility of taxing the wind company when they are making money and selling the electricity produced with South Dakota wind. South Dakota obtains much of the property taxes collected from a wind turbine based on the nameplate capacity (what is expected for output). The problem still exists that all large projects are not treated equal on collecting taxes for the State Treasury. This is the reason why I think someday we should discover the possibilities of expanding the bank franchise tax to include only major corporations who utilize the South Dakota workforce to make money in our state. Mainstreet South Dakota would finally be on a level playing field with the national and international companies who earn a profit in the Rushmore State.
I continue to monitor my two pieces of legislation that are alive and kicking. First off on Monday, I enjoyed a nice welcome back to Pierre when I received the press release that Governor Rounds signed my bill HB 1190! This is very important to our high school students who must make decisions as to whether they will shoot for the goal of achieving the Opportunity Scholarship. The elective category for the requirements of this scholarship previously only required foreign language, so I brought HB 1190 that inserted Career and Technical Education (CTE) courses as an alternative option. This bill also achieved other areas of flexibility for students and reinforced the rigor expected from our CTE courses, such as agriculture, family and consumer science, pre-engineering/drafting, and the health sciences area. The Governor’s staff has been great to work with on this bill and continues to monitor other legislation that might conflict with the intent of HB 1190, which is the law of the land in South Dakota.
Another piece of legislation that I continue to move forward is House Bill 1155, which sailed out of Senate Commerce amidst some concerns from a big wind energy company who thought requiring the area around the anchors for the wind metering towers would be over burdensome. Fortunately, the committee agreed with myself, refused the amendment and approved the bill. The entire Senate gave its solid approval, and now the bill is aimed toward the Governor’s desk.
Senate Bill 92 made its trek to the House side, but was defeated which is good for Northeast South Dakota. It would have placed a burden on our county if Native Americans would be incarcerated in another county. The Federal Bureau of Indian Affairs is responsible for covering the costs in these “other” counties, and I feel it would have not been fair to the residential counties to bear this burden. Treaties and federal policy would have been compromised with the passage of SB 92.
I voiced my opposition to a bill brought to the House Floor by the Department of Public Safety and the Department of Transportation, which will increase the penalties for traveling on the interstate when it is designated “closed”. Yes, nobody should be out on the interstate when the weather is so terrible that the state decides to stop all travel, but when dealing with this bill, I am more alarmed that if somebody doesn’t see a barrier or if a barrier does not exist to keep them off the interstate they immediately would have to prove why they didn’t know the interstate was closed. With the passage of this legislation, the burden of proof shifted from the law enforcement authorities to the individual who may be on the interstate when it is closed. Instead of $105 fine, the possibility exists that a judge could assess up to a $1000 fine.
Our House Agriculture and Natural Resources committee recently gave our stamp of approval for SB 75 which defines agritourism liability protections for landowners. Examples of possible agritourism could include vegetable and fruit “you pick it” operations, corn mazes, Christmas tree farms, and Dude Ranches.
Please keep me informed of any issues and concerns that are important to you. You can reach me at 949-2204 or leave a message in the House Chamber at 773-3851. My email is rep.frerichs@state.sd.us. Check out www.jasonfrerichs.com for updates.
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Welcome to the Roslyn Government Class
By Jason | March 3, 2010
The Roslyn Government class visited our State Capitol today. Joining them on their trip is their teacher Carol Gaikowski and her husband Pat. This is especially an important day because Roslyn will be dissolving their school district this summer. The reason for their permanent closure is due to the arbitrary minimum number of students required to operate a school district.
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Action needed to preserve the requirements for the Opportunity Scholarship
By Jason | March 2, 2010
Yes, we would like to celebrate the success and very favorable support we received from the entire Legislature on HB 1190; we have work to do to defeat recent attempts to continue to change the Opportunity Scholarship.
ACTION IS NEEDED:
Please encourage the Senate Education committee members to defeat the amendment offered by Sen. Bob Gray which is labeled HB 1224cd. The Committee will decide action on the bill this Thursday morning at 7:45am.
This amendment would raise the ACT Score to 26 from 24 and simply require a 3.0 GPA.
No course requirements would be included in the rules for the Opportunity Scholarshp. The advanced courses and requiring students to expand their horizons with elective courses such as CTE are very important and should not be compromised.
We must defeat the Gray amendment because it would essentially delete the intention of HB 1190 (which received solid support).
Thanks for all of the help.
Be sure to contact members of the Senate Education committee:
http://legis.state.sd.us/sessions/2010/CommitteeMembers.aspx?Committee=4
Senate Education Committee:
Garnos, Cooper
Gray, Bob
Jerstad, Sandy
Knudson, Dave
Nesselhuf, Ben
Olson, Russell
Peterson, Jim
You can also leave a message with them on the Senate Floor at: 773-3821
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HB 1190 Career and Tech Education for the Opportunity Scholarship signed by the Governor!
By Jason | March 1, 2010
The following press release was just issued today on House Bill 1190 that I was proud to work with Senator Russ Olson to get strong approval from both the House and the Senate and now the Governor has agreed with us!
Career and Technical Education has a level playing field for the requirements of the Opportunity Scholarship.
Office of the Governor
500 E. Capitol Ave.
Pierre, SD 57501
(605) 773-3212
FOR IMMEDIATE RELEASE: Monday, March 1, 2010
CONTACT: Joe Kafka or Roxy Everson at 605-773-3212
Governor Rounds signs bill into law
PIERRE, S.D. – Gov. Mike Rounds has signed the following bill into law:
HB1190 An Act to revise the high school course requirements and the requirements necessary to maintain eligibility for the South Dakota opportunity scholarship program.
For more information about this and other bills in front of the South Dakota Legislature, please visit www.legis.state.sd.us.
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Frerichs announces candidacy for District 1 State Senate
By Jason | February 26, 2010
WILMOT – State Representative Jason Frerichs announces today that he will seek the Democrat nomination for the State Senate seat in Legislative District 1. Frerichs is completing his first term as a member of the State House of Representatives where he provides leadership to the Democrat Caucus as a Minority Whip.
“I am proud of the quality of people who come from Northeast South Dakota and serve in Pierre; Senator Gary Hanson has recently informed me that he will not be seeking a fourth term in the Senate,” states Frerichs. District 1 includes the counties of Day, Marshall, and Roberts.
Next year due to the departure of many veteran Senators, the State Senate will need new leadership on issues important to agriculture, renewable energy, and education. Representative Frerichs continues, “I feel that I can utilize my abilities to work with both sides of the aisle to achieve results and respect for the people in our rural communities.”
Frerichs actively farms with his family near Wilmot where he raises corn, soybeans, wheat, alfalfa and manages a beef cow/calf operation. Serving as an agriculture instructor at Lake Area Technical Institute in Watertown ensures that Frerichs stays in touch with the current demands of relevant education.
Representative Frerichs is known for his work on updating the high school graduation requirements with passage of a bill that ensures a level playing field for career and technical education. Frerichs has worked in a bi-partisan manner with Senators from the Majority Party cosponsoring legislation. You can follow him on Twitter at www.twitter.com/jasonfrerichs.
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Reality in the State Legislature
By Jason | February 25, 2010
Maintaining a sense of reality is a prime goal that I set forth for myself as a lawmaker in the state of South Dakota. When we deal with various pieces of legislation in the state capitol, every effort is made to gather all of the facts and get down to the real issue for discussion. My return to the family farm each weekend (depending on the weather) is a prime opportunity for me to stay in touch with the real issues. For example, Pierre has roughly six inches of snow on the ground; we all know there are at least two feet and much more in places around Northeast South Dakota. I enjoy the opportunity to bring reality to the process in the Legislature.
House Bill 1246 received fair discussion on the floor of the South Dakota House of Representatives today. Unfortunately, members of the house decided to further allow oil pipeline companies to enjoy large tax rebates. The Governor’s Office twisted the arm of enough Republican legislators, which encourage them to defeat this bill. The House voted 32-26, which was not enough to pass the bill that required a two-thirds majority for approval. I enjoyed the support of eight Republican members of the House who joined with me in supporting this bi-partisan piece of legislation. Sen. Larry Rhoden served as my senate prime sponsor on HB 1246 which has been nice to have leadership from the Republican side to forge support.
Three main reasons why I think we should repeal the tax break on oil pipelines revolves around: geography – South Dakota just happens to be in the path of the pipeline, subsidy to a foreign company, only ten permanent jobs would be created. Our State could retain $38 million if we would simply repeal the tax breaks for oil pipelines. When we know the company will be coming through our state regardless, I find it unfair to give such large tax breaks to a foreign company.
Due to the strong support in the House Taxation Committee, HB 1246 made it to the House floor with a vote of 12-2 in favor of the bill. I enjoyed the support from the Department of Revenue as well as the Coalition of Schools who encouraged members of the Taxation Committee to approve HB 1246. Opposition on the bill was received from the TransCanada oil pipeline company, along with Julie Johnson from the Aberdeen Economic Development Corporation. I understand the bill would affect the pipeline company; but I must admit I was a little surprised that the Aberdeen Economic Development Corporation was involved.
Some of you may be wondering if this oil pipeline company could actually afford the sales and contractors excise taxes that all of us are required to pay, as well as hospitals. Let me give you an example from last week. The price of oil went up three percent (3%), so three percent (3%) of the $900 million project is $27 million. As you can see just in one week, this pipeline company could have justified paying these taxes to South Dakota.
Working through issues and developing a solution to the problem is one of the most enjoyable aspects of my elected position. House Bill 1155 was tabled in the House Commerce Committee, due to concerns from the wind industry about locating the position of anemometer towers. After dealing with the tabling of HB 1155, the crop dusters and I brainstormed and decided to offer an alternative to the original bill that will simply require marking of the anemometer towers. The Department of Transportation was helpful in providing an opportunity for the crop dusters and wind company representatives to work through a compromise. HB 1155 was amended in the House Commerce Committee earlier this week and then was sent to the House Floor on the consent calendar. Now the Senate will work through HB 1155, and I am fortunate to have Senator Al Novstrup, the prime sponsor in the Senate, providing bi-partisan support.
I served on the subcommittee that heard discussion on the raw milk licensing bill presented by the State Department of Agriculture. This issue has garnered a lot of attention from folks involved in the farmer’s market area, health department, as well as individuals from all areas of agriculture. I didn’t support the bill presented by the Department of Agriculture mainly because I think smaller dairy producers will be required to get permits and licensing that will result in an extra burden placed on their farm operation. I also have concern about the maximum fine for a violation that could be assessed on folks who may not follow the rules of the game in providing raw milk to consumers in South Dakota.
Many of you probably have heard the news by now that the House Democrat Caucus block-voted against the special funding for the Homestake Mine underground science laboratory. The main issue amongst many Democrats is that we shouldn’t use general fund dollars to pump the water out of a hole in the ground. I am a huge supporter of increased educational opportunities; however, when we are in dire need of education funding at all levels in our state, I find it unfair to invest general fund dollars in the Homestake laboratory. The Republican leadership can easily insert funding for the underground science laboratory in the general appropriations bill that all of us hope to see very soon. Unfortunately those of us who are not in the majority and also not on the appropriations committee, so we will only see the general bill for just a few hours before we vote on it more than likely.
I am still waiting for the Governor to sign House Bill 1190, which received overwhelming support in both the House and Senate. HB 1190 is the bill that will change the curriculum requirements for the Opportunity Scholarship to include the option of career and technical education courses in the elective category.
It is my pleasure to continue to serve as your Representative in the South Dakota State Legislature. I continue to forge working relationships on both sides of the aisle. Garnering respect from my fellow lawmakers is important to me, especially since many folks have a few years of experience more than I do.
Please contact me with your thoughts and concerns on issues that are important to you. You can reach me at rep.frerichs@state.sd.us, www.jasonfrerichs.com. During session feel free to leave a message in the House Chamber for myself or any other Representative by calling (605) 773-3851. Follow me on Twitter at www.twitter.com/jasonfrerichs.
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House Bill 1155 the Anemometer Tower Marking Bill approved by the House
By Jason | February 24, 2010
House Bill 1155 the bill to require marking on the anemometer towers (wind metering) in an effort to make them visible to crop duster pilots. We worked out a compromise between the wind companies and crop duster pilots. While this isn’t a perfect solution to the problem it is a start to ensure safety for our pilots in South Dakota.
The House Commerce Committee agreed with our compromise on Monday of this week, and even put the bill on the consent calendar; which signifies their solid support!
Tuesday the entire House approved HB 1155 with a vote of 67 for the bill and 0 against.
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House Bill 1246 was defeated; oil pipeline companies will enjoy huge tax breaks
By Jason | February 23, 2010
My conscience is clear. I made every effort to ensure that the taxes paid by oil pipelines would be retained in the State Treasury. House Bill 1246 is a bi-partisan piece of legislation and has been an enjoyable experience to hold accountable a foreign company who plans to build their oil pipeline regardless.
House Bill 1246 received fair discussion on the Floor of the South Dakota House of Represenatives today. Unfortunately, members of the House decided to continue to further allow oil pipeline companies to enjoy large tax rebates. The House voted 32 in favor and 36 against HB 1246. All of the House Democrats and eight Republicans joined with me to agree that oil pipelines do not deserve a sales and contractors excise tax rebate.
Below are the three main points that I stressed in encouraging support for HB 1246:
– Geography of South Dakota is the reason why the pipeline travels through our State
– Subsidy to a foreign company
– Only 10 permanent jobs in the Midwest created
- $38 Million tax rebate
- Emergency Clause
- Good protection for our State
- TransCanada told us in committee that they don’t have all of their costs defined
- Does not affect Keystone 1 the first pipeline
- Incentive was given
- Price/oil fluctuation
- Last week oil went up 3%
- 3% of $900 million is $27 million
- Will we see the pipeline move to other states?
- Million dollars a mile to install
- Other State taxes
- Wyoming – 5% property tax as a part of income whereas
SD is 2.7% - Nebraska – 3.6% property and a corporate income tax (if anything they would want the pipeline to stay in SD longer
- Wyoming – 5% property tax as a part of income whereas
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HB 1246 will be decided in the House on Tuesday
By Jason | February 23, 2010
House Bill 1246 which will repeal the tax breaks for oil pipelines will be up for discussion and action in the House Chamber on Tuesday. Call 773-3851 and tell members of the House to support HB 1246 that will ensure oil pipelines pay full taxes which will allow our State to fully invest in education.
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