SD program that refunds taxes on large industrial projects likely headed to public vote

The fate of a program that provides grants for large business projects in South Dakota is likely headed to a statewide vote in November 2012.

Petitions to refer the program have enough valid signatures to qualify the matter for the ballot, Secretary of State Jason Gant said in a statement released Monday. He said based on a random sampling of 5 percent of the signatures, they are 2,510 signatures over the required 15,855 needed.

Anyone who wants to challenge Gant’s ruling must do so within five days.

The state Democratic Party circulated the petitions to bring the matter to a statewide vote.

“We get to spend the next 15 months having a conversation on if we want to spend our limited resources on senior citizens and kids or if we want to spend it on corporations,” state Democratic Party Chairman Ben Nesselhuf told the Argus Leader newspaper.

The Republican-controlled Legislature passed a bill this year at the urging of Republican Gov. Dennis Daugaard to refund construction taxes to industrial projects that cost at least $5 million.

The program has existed for years, but the Legislature last year had reduced the size of refunds and scheduled the program to end in December 2012. The change approved this year extends the program. It would put 22 percent of the contractor’s excise tax — which typically brings in $16 million annually — into a fund that would provide grants to large projects.

Opponents say the money would be better spent on such things as education and Medicaid. Supporters say the program will promote business expansion and increase the property tax base to benefit local schools.

“Voters, especially in this economy, care about local businesses being able to expand, and care about jobs,” David Owen, president of the South Dakota Chamber of Commerce & Industry, told the Argus Leader.

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