SIOUX FALLS S.D. (KELO) — Some Minnehaha County Commissioners are raising concerns regarding the future of property taxes in South Dakota and how it will impact both homeowners and county budgets.
During Tuesday’s Minneheha County Commission meeting, discussion about the county’s equalization office turned to the future on how property taxes will change with new bills signed by Republican Gov. Larry Rhoden last week.
Rhoden signed Senate Bill 216, which caps growth in assessed values for owner-occupied homes in a county at 3% and limits school districts to annual increases of no more than 3% from property taxes for capital budgets. The 3% cap is based on the entirety of growth in assessed values, not individual homes.
The bill goes into effect July 1.
SB216 reads “assessed value may not increase more than three percent over the total assessed value of all property in the county with an owner-occupied single-family dwelling classification in the prior year, except as otherwise provided in this section.”
Chris Lilla, Equalization Director for Minnehaha County, said the bill is not 3% cap on any individual property.
“If your neighborhood market needs to go up 10%, your value is going to go up 10%. It’s only at the total value change for budgeting and levy establishment,” Lilla said.
Lilla said the value in the previous year and the value of the current year is split into two categories, where they break down how much of that value was growth, and how much was re-appraisal.
“So what I understand is they’re looking at that total,” Lilla said. “If the owner-occupied happened to be 3.5%. They’re gonna have to take 0.5% of that away and put it on the non-owner occupied.”
Lilla added while every county might assess at different values they are all taxed the same.
“You’ve got three different directors assessing at different levels, but when it comes to the taxable, it’s equalized, we’re all taxed at the same,” Lilla said.
Minnehaha County Commissioner Joe Kippley said he was disappointed with the level of detail from the legislature on SB 216.
“Not enough homework was done on actually gaming out how it would be implemented,” Kippley said. “I just think we’re gonna be left holding the bag here at the county to do our math and show our work to our constituents of what they really save or if it just gets shifted around, for the next 5-year period.”
Lilla also said after that 5-year time period, home owners may see a jump in year six as well as a dramatic shift back to owner-occupied and a lessening on the commercial.
Kippley added he feels that they are going to have to get a real legislative fix to this within that 5 year period, adding that they have a “time bomb” on their hands.
