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Politics

CAFO Construction Tax Bill For Schools Heads To House Floor

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Katie Hunhoff - South Dakota Magazine
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The House Taxation Committee is passing along one of two bills that redirects a tax on new construction of concentrated animal feeding operations to local governments.

Supporters say the generated revenue would help local schools or counties.

Opponents say the move gives the CAFO industry leverage when building a facility in a community that opposes the idea.

House Bill 1234 deposits up to 200-thousand dollars of the contractor’s’ excise tax into the capital outlay fund of the school district a concentrated animal feeding operation is located.

There are about 450 permitted CAFO’s in South Dakota. Officials say over the last four years, the number of CAFO permits have leveled off.

Republican State Representative Doug Post is the prime sponsor of the bill. He says it takes money from the state pocket, and places it into the local school district’s pocket for improvements.

Post says the state needs to allow more incentive for communities to see animal agriculture as a tax revenue source.

“In our towns and cities, quite frequently, we give tax deferments or something along those lines to attract these industries into our town and communities to help grow our tax base and our economic development. There’s nothing for that in agriculture at this time. This bill would provide that.”

Post’s bill passes to the house floor on an 8 to 5 vote. A similar bill places the contractor’s excise tax into county coffers for infrastructure improvement.

Opponents say because CAFO permits are levelling off, rural communities are indicating they’re concerned by these operations.

Rebecca Terk is a community organizer for Dakota Rural action.

“Saying that ‘We’ll give you a bunch more money for your schools or your roads or your bridges,’ those things can be handled, particularly with roads, bridges, infrastructure, those should be handled with road haul agreements,” Terk says. These kinds of facilities should be paying those funds upfront as part of their conditional use permitting process, and not using them as a lever to get them into communities that don’t want them there.”

A similar bill that places the contractor’s excise tax into the hands of counties (is headed for) the House Taxation committee, but has not been scheduled for a hearing.

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