* The HASTY list of cuts is a vivid reminder that state government is BROKEN. The system isn't working. Slashing key programs like Extension, health care and K-12 schools (*the state fair ... pick your favorites) is just a BAND-AID approach to a big problem.

*  We need NEW LEADERSHIP in Pierre that provides stability, FISCAL DISCIPLINE, fairness and transparency to the budget process. Government must CHANGE  -- and become leaner, smarter, more streamlined and efficient. We haven't balanced our books with ongoing revenues for seven of the last eight years — now eight of the last nine. How long can that continue?

* VICTIMS of the GOP cuts will now have a few short days to plead their case in Pierre. This is no way to set a budget for a $4 BILLION operation like state government. It's not fair to the people. It's not open government.

* Democrats  have for years been offering solid ideas on how to avert this last-minute fiscal wrecks. We have advocated LIMITING GOVERNMENT GROWTH by 3% a year. That step alone, if adopted, would have kept us out of the coming week's BUDGET CALAMITY.  We've also called for 

ZERO BASED BUDGETING -- so we have a process that enables citizen legislators to truly scour government for efficiencies, waste and better ideas 

* Some of the GOP leaders' budget cuts mirror the budget cuts offered by Democratic leaders as far back as November, and we appreciate their willingness at this LAST MINUTE  to join us in cutting corporate tax breaks, legislative travel and an across-the-board cut that we advocated from the start.

But they DON'T GO DEEP ENOUGH. We believe we can save millions just by ending NO-BID CONTRACTS  -- and millions more by FINDING REAL, LONGTERM SOLUTIONS to stopping government growth — especially through A FAIR AND OPEN BUDGET PROCESS.

* The ideas now on the table may get us through the week ahead. BUT THIS FAILS TO FIX LONG-STANDING PROBLEMS in state government's finances. We need a real VISION to reform and change the way government works in South Dakota, and the LEADERSHIP to make it work.

CORPORATE TAX INCENTIVES SHOULD TARGET JOBS

Democrats proposed cuts in corporate tax give-away programs on the first day of the legislative session, and now the entire legislature seems ready to follow that lead.  More than $70 million in corporate sales and contractors excise taxes will be rebated in the year ahead if the legislature doesn’t reform the system immediately.

Democrats believe some incentive programs should be continued, but there must be certain goals:

•                ·       Incentives should be targeted to companies that provide permanent jobs, and the number of jobs should be commensurate with the incentives
·       Incentives should be part of the budget process (as opposed to the  secrecy of the past, when blank checks are given to companies regardless of merit)
·       A “return on investment” evaluation should be done for each project
·       Projects that provide alternative energy (bio-fuels, wind, etc.) should be priorities


A MILLION SAVED IS A MILLION EARNED

On several occasions this session, Republicans voted to intentionally pick court fights with the federal government or other entities. The court battles could cost hundreds of thousands of dollars in lawyer fees and costs if the measures do land us in federal court.

Even though our State Constitution already ensures the public’s right to a secret ballot (Article 7, Sect. 3), Republicans block-voted to put a measure on the November ballot that confuses the constitution with similar language. They apparently did so to placate large corporations who are battling with labor unions over the processes for union elections.

Anything done on the state level would violate the National Labor Relations Act and federal law, but Republicans insisted on risking a major lawsuit.

They did the same on Wednesday in the House of Representatives when they voted to override federal gun manufacturing laws — a nice idea, perhaps, but a clear violation of the law and another invitation for a lawsuit. Such lawsuits will come at the expense of school funding, health care and other budget priorities.

FTE ISSUE MORE CONFUSING THAN EVER

Harry Truman said, “If you can’t convince them, confuse them.” Republicans must have read his biography, because they are making it harder to get an accurate count of how many people work for state government. Republicans have been budgeting for hundreds of FTEs who don’t exist — though the bureaucrats spend the money anyway. Now Republicans have passed a bill on a party-line vote that says hundreds of part-time workers who actually draw paychecks are no longer FTEs.

But any way you count them, state government employment has mushroomed by 1,300 or more FTEs in the last eight years. That’s a rate of a new hire every 48 hours. No wonder we have a swelling budget deficit. State government has outgrown our ability to pay.

 

 

6th Week-Week Ending February 19, 2010

HB 1178--For an act entitled, An Act to prohibit the use of certain wireless communications devices while driving. 

I introduced a bill to prohibit text messaging while driving.  It also included a prohibition against reading and writing emails on PCs while driving (for the past two years cell phone related accidents resulting in death or serious bodily harm have exceeded those related to alcohol).  Proponents  of the bill included:  the insurance industry, General Motors, the South Dakota Police Chiefs Association, SD Association of Healthcare Organizations, and the SD Department of Public Safety.  The bill had no opponents and passed out of House Transportation Committee with a 7 to 4 Do Pass recommendation.  It failed to pass the House with a vote of 33 yeas to 34 nays a couple days later. Some of you may remember that just over two years ago we lost three Turner County residents as a result of a cell-phone distraction caused accident just North of Hurley.  Currently 19 states and Washington, DC ban texting while driving, and 6 states and Washington, DC require use of hands-free devices by motorists talking on phones.  SD Department of Safety employee Jim Carpenter testified in the Transportation Committee that, "Not only do you lose visual acuity with the road, you lose manual dexterity with the wheel and lose cognitive dexterity in recognizing what's there."  We have a problem here and I will introduce it again next year.

 

BUDGET SOLUTIONS STALLED

Democrats offered a package of budget cuts, reorganizations, and savings in the first week of the legislative session; but at the end of the sixth week we are still waiting for solutions from our Republican legislative colleagues.  Republicans also killed most of our party’s proposals on party-line votes — including out-of-state travel cuts, pay cuts for legislators and executive-level state officials, combining state offices, eliminating Washington lobbyists, and others.“If you like the way they do things in Washington, you’ll love the way they do things in Pierre,” said Senate Minority Leader Scott Heidepriem this week. He believes an across-the-board cut may still be necessary to balance the state’s budget for fiscal year 2011.

 ELECTING AN AG CHAMPION

South Dakota may be the USA’s most rural state, but seldom do farm and ranch issues get much attention at election time. State Rep. Dean Schrempp of Eagle Butte tried to change that on Wednesday with a proposal that would call for election of the Secretary of Agriculture. The position is now filled by appointment of the governor.Republicans on the House State Affairs Committee argued that the elected official might disagree with the governor – or even run against him. By that argument, we would just allow the governor to appoint everybody in Pierre.Agriculture needs a higher profile in the public arena, and by electing an agriculture champion every four years we could make that happen. Democrats supported the bill but it was killed on a party-line vote.

 

SHOULD WE TAX FOOD?

Legislators have argued for decades over the morality of taxing food purchases. This hardly seemed like a good year to repeal any tax because of the budget shortfall, but Rep. Marc Feinsten and Sen. Pam Merchant came up with a reasonable plan to slightly raise the sales tax to make the policy revenue neutral. Rep. Feinstein estimates that a .3% hike in the sales tax to 4.3% would be enough. He and others pointed out that the 4% state sales tax on food can be a huge burden on poor and middle class families and elderly citizens — in fact it can easily amount to two weeks of groceries.The bill passed in House Taxation 9-6, but it still has a long ways to go.

 DEMOCRATS TRY TO INSTILL BUDGET DISCIPLINE

State government has shown no discipline in spending over the past eight years, so Democrats offered two ideas on how to control growth in the future. Both were killed on party-line votes in committee. Both were similar to methods used successfully in other states:

 

• Sen. Scott Heidepriem proposed limited state spending growth to 3% per year – an idea he and other Democrats have championed for several years — and one that would have avoided the current budget shortfall.’
• Sen. Heidepriem and Rep. Bernie Hunhoff also brought a new idea that is patterned after other states. It calls for spending no more than 98 percent of ongoing revenues each year on general, on-going expenses of state government. The remainder would first fill the state’s budget reserve funds and then be directed to K-12 education. A two-thirds vote of lawmakers would be required to spend one-time funds.  Spending one-time funds for ongoing revenues is one of the major reasons why we have a budget problem in South Dakota.

 

WIND ENERGY INCENTIVES

Democratic legislators have joined with our Republican colleagues and energy leaders to find compromises that will encourage growth in the wind energy industry while also protecting the best interests of landowners and rural communities. Hopefully the compromise can be passed into law.

Rogue speculators have tried to tie-up wind easements in South Dakota — a practice that hurts landowners as well as legitimate developers.  The compromise, if passed, will keep current safeguards in place on easement practices — but relax them for large projects that need more time for planning and development. The compromise will also address the “gag” provisions that many developers use to keep landowners from sharing information on easement benefits. Democrats have fought for land-owner protections, and will continue to be sure they are part of the policy.

 THREE WEEKS TO GO

The 2010 session has just three weeks remaining. We must figure out how to provide essential services — education, health care and public safety — without raising taxes on South Dakotans. It will take a combination of careful spending of reserves and budget savings to accomplish our goal.

Democrats will continue to oppose any new taxes on people and small businesses in South Dakota. We’ll also try to find better efficiencies in the tax give-away programs that are costing the state tens of millions of dollars. If we don’t change the laws, the Trans Canada XL Pipeline will receive a $38 million tax break in the coming year. That money would go far in continuing basic services for South Dakotans.

 

For the week ending February 11, 2011