Proposed Restaurant, Hotel, and Campground License Fee Increase Fails

Jan 29, 2015

A proposed license fee increase for food service, lodging, and campground establishments failed to make it past a Senate committee.

Senate Bill 62 increases the annual license fees for restaurants, hotels, and campgrounds. Tom Martinec is the Deputy Secretary for the Department of Health. He says one reason for the change is that the current fees collected don’t cover the cost of the program.
“This issue boils down to who should be shouldering the cost of the inspection program,” Martinec says. “The establishment owners through the fee revenue, or the general public through their tax dollars? Again, we believe that the premise or expectation should be that the fee revenue generally offsets the cost of the inspection program. However the information we provide shows that’s not what’s happening. In fact costs have historically outpaced fee revenue, and general funds have been and continue to make up that difference.”
Martinec says no one likes a fee increase, but it’s necessary in order to be good stewards of state general fund dollars.

But opponents of the measure say it comes at a bad time. Shawn Lyons is the executive director of the South Dakota Retailers Association. He says there needs to be more time for communication between the parties involved.
“One of the things, and we’ll take responsibility for that as well, is we think there needs to be better ongoing dialogue between the state and the industry as to the whole aspect of the inspection program,” Lyons says. “How businesses can do their part, making sure that their inspections go appropriately, things that they can improve upon, maybe their own criticisms of inspectors that come out into those businesses and the expertise that they have. There are things that we think can be improved upon. So there may be need at this time for the increase, or maybe there’s an opportunity to say maybe we need to just sit back and wait for another year and talk about it.”
Members of the Senate Commerce and Energy Committee voted four to two to send Senate Bill 62 to the 41st legislative day, effectively killing the measure.