South Dakotans Oppose Governor’s Corporate Welfare

Corporate welfare proposed by Governor Dennis Daugaard has little public support, according to a new poll by Public Policy Polling.

Daugaard’s bill (HB 1230) has already passed the House, and this morning the Senate State Affairs Committee passed the bill on a party line vote. The bill now goes to the full Senate for final approval. It gives 22% of the contractor’s excise tax — about $16 million per year — to a Large Projects Development Fund. Grants would be awarded to corporate projects at the discretion of the governor’s office. The money would otherwise go to the General Fund, which is used for schools and health care.

The poll, which questioned 1,667 voters between Feb. 25-27, 2011, found that 62% of South Dakotans oppose the corporate give-away, while only 19% liked the idea. 18% were undecided. This poll has a margin of error of +/- 2.4%.

The proposal falls along party lines in Pierre. Republican legislators support the governor to date, while Democrats decry the fund as more corporate welfare. Democrats objected last session when a similar program gave millions of dollars in tax rebates to TransCanada Pipeline, even though the company produced few permanent jobs in South Dakota.

“The old rebate program had good intentions, but it clearly didn’t work.” said Ben Nesselhuf, Chairman of the South Dakota Democratic Party. “This bill just throws good money after bad. It will deny our children and seniors millions of dollars every year.”

“Government officials should not pick winners and losers in the marketplace. Unchecked corporate give-aways don’t create jobs. This is a waste of taxpayers’ money at a time when we are struggling to keep teachers in our classrooms and trying to keep nursing homes from closing because of the governor’s budget mistakes.”

Nesselhuf urged state legislators to heed the poll when they consider HB 1230. “The governor is wrong to give away General Fund tax dollars at the same time that he is cutting schools and health care,” he said.

Nesselhuf said South Dakota’s lack of transparency in economic development programs and the state’s weak “pay to play” laws also are good arguments against giving $16 million to the governor. “I’m sure it would only be a coincidence when corporate campaign checks and state checks to corporations begin to cross in the mail,” he said. “These would only be coincidences, but government needs to be above suspicion in these lean times. Pierre can’t afford to lose the public’s faith in the integrity of government.”

Nesselhuf noted that Democrats proposed tougher campaign finance laws and an economic development reporting system in this legislative session, but Republicans killed the bills at the request of the governor’s office.

Highlights of the poll are below:

Q: Governor Daugaard has proposed that the state take 22% of the contractor’s excise tax, which normally goes to fund health care and education, and use it to pay for a subsidy program to attract new large corporate projects. Do you support or oppose this proposal.
Support: ……………..19%
Oppose: ……………..62%
Not Sure:……………..18%

Margin of error: 2.4%

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