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Senate Journal 3/29/2016 10:00 AM

JOURNAL OF THE SENATE

NINETY-FIRST SESSION




THIRTY-EIGHTH DAY




STATE OF SOUTH DAKOTA
Senate Chamber, Pierre
Tuesday, March 29, 2016

    The Senate convened at 10:00 a.m., pursuant to adjournment, the President presiding.

    The prayer was offered by the Chaplain, Pastor Sarah Goldammer, followed by the Pledge of Allegiance led by Senate pages Haley Ketteler, Joshua Weinheimer, and Shale Kramme.

    Roll Call: All members present except Sens. Holien and Peters who were excused.

APPROVAL OF THE JOURNAL

MR. PRESIDENT:

    The Committee on Legislative Procedure respectfully reports that the Secretary of the Senate has had under consideration the Senate Journal of the thirty-seventh day.

    All errors, typographical or otherwise, are duly marked in the temporary journal for correction.

    And we hereby move the adoption of the report.

Respectfully submitted,
Gary Cammack, Chair

    Which motion prevailed.
COMMUNICATIONS AND PETITIONS

March 11, 2016

Mr. President and Members of the Senate:

    I have the honor to inform you that on March 11, 2016, I approved Senate Bills 131 and 133, and the same have been deposited in the office of the Secretary of State.

Respectfully submitted,
Dennis Daugaard
Governor

March 14, 2016

Mr. President and Members of the Senate:

    I have the honor to inform you that on March 14, 2016, I approved Senate Bills 19, 31, 46, 91, 93, 107, 127, 129, 132, 142, and 152, and the same have been deposited in the office of the Secretary of State.

Respectfully submitted,
Dennis Daugaard
Governor

March 15, 2016

Mr. President and Members of the Senate:

    I have the honor to inform you that on March 15, 2016, I approved Senate Bills 2, 9, 26, 43, 45, 49, 81, 82, and 90, and the same have been deposited in the office of the Secretary of State.

Respectfully submitted,
Dennis Daugaard
Governor


March 16, 2016

Mr. President and Members of the Senate:

    I have the honor to inform you that on March 16, 2016, I approved Senate Bills 48, 92, 98, 104, 112, 140, 143, 162, and 172, and the same have been deposited in the office of the Secretary of State.

Respectfully submitted,
Dennis Daugaard
Governor

March 22, 2016

Mr. President and Members of the Senate:

    I have the honor to inform you that on March 22, 2016, I approved Senate Bills 58, 67, 106, 168, and 169, and the same have been deposited in the office of the Secretary of State.

Respectfully submitted,
Dennis Daugaard
Governor

March 25, 2016

Mr. President and Members of the Senate:

    I have the honor to inform you that on March 25, 2016, I approved Senate Bills 148, 158, and 159, and the same have been deposited in the office of the Secretary of State.

Respectfully submitted,
Dennis Daugaard
Governor

    Unless there is an objection, the President waives the reading of the veto message.


March 25, 2016

The Honorable Matt Michels
President of the Senate
500 East Capital Avenue
Pierre, SD 57501-5070

Dear Mr. President and Members of the Senate,

I respectfully return Senate Bill 64 with the following recommendations as to STYLE and FORM.

Senate Bill 64 is an Act to revise the voting authority of an alderman.

The bill as originally introduced resolved a narrow problem set forth by the bill's proponents. Other proposed changes to existing law were presented as style and form revisions to clarify existing law. However, some of the proposed changes would create greater ambiguity or substantively alter the law in unintended ways. These problems can be avoided by making the following style and form corrections to the Enrolled version of Senate Bill 64:

On page 3, Section 8, third sentence, after "the aldermen" insert "holding office".

On page 3, Section 9, second sentence, after "vote of" insert "all".

On page 3, Section 9, second sentence, after "the aldermen" insert "holding office".

On page 3, Section 9, second sentence, after "or proposal" delete ", or".

I respectfully request you concur with my recommendations as to style and form.

Respectfully submitted,
Dennis Daugaard
Governor


March 25, 2016

The Honorable Matt Michels
President of the Senate
500 East Capital Avenue
Pierre, SD 57501-5070

Dear Mr. President and Members of the Senate,

I respectfully return Senate Bill 65 with the following recommendations as to STYLE and FORM.

Senate Bill 65 is an Act to revise the procedure for a municipal recall petition.

The bill as presented contains ambiguity as to the commencement of the ten-day timeframe for council action. This ambiguity can be resolved by making the following style and form corrections to the Enrolled version of Senate Bill 65:

In Section 2, on the first line, insert "of presentation" after "within ten days."

I respectfully request you concur with my recommendations as to style and form.

Respectfully submitted,
Dennis Daugaard
Governor

March 25, 2016

The Honorable Matt Michels
President of the Senate
500 East Capitol Avenue
Pierre, SD 57501

Dear Mr. President and Members of the Senate,

I respectfully return to you Senate Bill 96, with my VETO.

Senate Bill 96 is an Act to revise the reimbursement for members of the Board of Pardons and Paroles.

The bill, in its original form, would have increased compensation for members of the Board of Pardons and Paroles by raising the per diem paid to the members from $75 to a minimum of $200 per day. However, an amendment to the bill set a fixed per diem allowance. The final bill pays Board members a certain per diem, all of which is taxable, and limits the ability of the Department of Corrections to handle unexpected lodging costs.


Under current law, Board members are reimbursed a per diem for the day, which is taxable, plus given stipends for meals and lodging, which are not taxable. In the event lodging cannot be procured at the state rate, the Department of Corrections has the ability to request a waiver from the State Auditor to cover the higher rate. Under Senate Bill 96, Board members would be given a fixed per diem, that while larger than their current per diem, is taxable and cannot be adjusted for higher lodging rates. In certain circumstances, Board members will be receiving less overall compensation from the state under Senate Bill 96 than under the current system.

Because I appreciate the work of this important board and have great respect for the dedication of its members, I do not believe we should burden the members with increased paperwork, increased taxes, and less overall compensation.

For these reasons, I oppose this bill and ask that you sustain my veto.

Respectfully submitted,
Dennis Daugaard
Governor

March 25, 2016

The Honorable Matt Michels
President of the Senate
500 East Capitol Avenue
Pierre, SD 57501

Dear Mr. President and Members of the Senate,

I respectfully return to you Senate Bill 100, with my VETO.

Senate Bill 100 is an Act to enhance South Dakota economic development through broadband infrastructure improvements.

This bill makes fundamental changes to the Reinvestment Payment Program, part of the Building South Dakota legislation passed by the Legislature in 2013. Under the current program, businesses may apply to the Board of Economic Development for a sales and use tax refund on projects in excess of $20 million or $2 million in equipment costs. Refunds are not automatic; applications are reviewed to determine whether the incentive is necessary to secure the project for South Dakota. The Board of Economic Development's evaluation process lies at the heart of our state's economic development incentives and ensures that our state's taxpayers are not asked to pay for projects that would occur without a state incentive.

The changes in Senate Bill 100 would be a step back to the system of automatic tax refunds that the Reinvestment Payment Program was designed to replace. Specifically, the bill makes qualification automatic for a segment of broadband projects receiving federal grant funds. Clearly, companies receiving a federal grant have already committed to their project regardless of any state incentive. In addition, the bill creates internal inconsistencies in the law that will make it confusing for the Board of Economic Development to administer, and for prospective

applicants to understand. The Board of Economic Development must have the authority to direct our state's incentives to projects that will not happen without an incentive.

The telecommunications industry has already invested heavily in South Dakota, based not only on market factors, but on changing technologies, federal regulatory requirements and incentives, and internal strategy. I do not believe Senate Bill 100 is necessary for these investments to continue.

For these reasons, I oppose this bill and ask that you sustain my veto.

Respectfully submitted,
Dennis Daugaard
Governor

March 25, 2016

The Honorable Matt Michels
President of the Senate
500 East Capitol Avenue
Pierre, SD 57501

Dear Mr. President and Members of the Senate,

I respectfully return to you Senate Bill 136, with my VETO.

This bill provides that "any agricultural land that has crop-rated soils within fifty feet of a lake, river, or stream shall be categorized as noncropland if the land is seeded to perennial vegetation. The land shall be assessed as noncropland for the purposes of determining the agricultural income value of land."

In short, this bill requires the county director of equalization to lower the property tax assessment on perennial buffer strips adjacent to water bodies, which will result in a loss of property tax valuation and a shift of that tax burden to other property owners.

This bill does not create a new, fourth class of property, but instead changes the treatment of certain lands within the agricultural property class. I am concerned that this bill is in violation of Article XI, § 2 of the South Dakota Constitution, which provides that "[t]axes shall be uniform on all property of the same class ." This bill taxes agricultural property within fifty feet of a stream or river differently than agricultural property not in proximity to a stream or river.

In addition, this bill breaches the longstanding principle of taxing property based on its highest and best use. In recent years, many farmers have voluntarily established grass buffer strips adjacent to riparian areas. These buffers are often comprised of high quality crop-rated soils.


Under this bill, the taxes paid by landowners of these crop-rated soils would be reduced and the burden shifted to other property owners. This is because any loss of property valuation results in higher property tax levies to prevent revenue losses to schools, counties, townships, and other taxing districts.

Subsidizing land-use decisions through property tax policy is contrary to the tenet of highest and best use - a fundamental property tax principle and the foundation of our entire property tax system.

Further, the plain language of the bill provides for numerous unintended consequences. For instance, section 1 refers to land "seeded to perennial vegetation." As one example, in South Dakota alfalfa is "perennial vegetation" commonly harvested as a crop (alfalfa hay). If grown within 50 feet of a riparian area, that alfalfa hay land may qualify for a tax reduction. However, section 2 does not anticipate "perennial vegetation" being grown as a crop because it specifically states that "Any person who requested that land be categorized as noncropland pursuant to section 1 of this Act and changes the use of the land to cropland or another use [italics added] shall notify" the director of equalization. This ambiguous language makes it difficult to determine how this bill will impact crop-rated soils planted to alfalfa.

Implementing this bill would require the Department of Revenue and county directors of equalization to determine whether dry creek beds, field waterways, small ponds, and other watercourses meet the definition of a "lake, river, or stream." They are further tasked with establishing where the riparian area starts and ends - determinations these entities may not be equipped to make. All told, these challenges will result in greater uncertainty and more resources required to determine the appropriate tax.

While the bill's intent to improve water quality is laudable, shifting the tax burden from one taxpayer to another due to a voluntary management decision is bad tax policy. Its questionable constitutionality and ambiguous language also invites potential legal challenges. For these reasons, I oppose this bill and ask that you sustain my veto.

Respectfully submitted,
Dennis Daugaard
Governor

CONSIDERATION OF EXECUTIVE VETOES AND RECOMMENDATIONS

    The Senate proceeded to the consideration of the recommendation of the Governor as to change of style and form of SB 64 as found on page 620 of the Senate Journal, as provided in Article IV, Section 4, of the Constitution of the State of South Dakota.

    The question being "Shall the recommendation of the Governor as to change of style and form of SB 64 be approved?"

    And the roll being called:



    Yeas 25, Nays 8, Excused 2, Absent 0

    Yeas:
Bradford; Brown; Buhl O'Donnell; Cammack; Curd; Ewing; Fiegen; Frerichs; Haggar (Jenna); Haverly; Heineman (Phyllis); Heinert; Hunhoff (Bernie); Parsley; Peterson (Jim); Rampelberg; Rusch; Shorma; Soholt; Solano; Sutton; Tidemann; Tieszen; Vehle; White

    Nays:
Greenfield (Brock); Jensen (Phil); Monroe; Novstrup (David); Olson; Omdahl; Otten (Ernie); Van Gerpen

    Excused:
Holien; Peters

    So the question having received an affirmative vote of a majority of the members-elect, the President declared the recommendation of the Governor as to change of style and form approved.

    The Senate proceeded to the consideration of the recommendation of the Governor as to change of style and form of SB 65 as found on page 621 of the Senate Journal, as provided in Article IV, Section 4, of the Constitution of the State of South Dakota.

    The question being "Shall the recommendation of the Governor as to change of style and form of SB 65 be approved?"

    And the roll being called:

    Yeas 33, Nays 0, Excused 2, Absent 0

    Yeas:
Bradford; Brown; Buhl O'Donnell; Cammack; Curd; Ewing; Fiegen; Frerichs; Greenfield (Brock); Haggar (Jenna); Haverly; Heineman (Phyllis); Heinert; Hunhoff (Bernie); Jensen (Phil); Monroe; Novstrup (David); Olson; Omdahl; Otten (Ernie); Parsley; Peterson (Jim); Rampelberg; Rusch; Shorma; Soholt; Solano; Sutton; Tidemann; Tieszen; Van Gerpen; Vehle; White

    Excused:
Holien; Peters

    So the question having received an affirmative vote of a majority of the members-elect, the President declared the recommendation of the Governor as to change of style and form approved.


    The Senate proceeded to the reconsideration of SB 96 pursuant to the veto of the Governor and the veto message found on page 621 of the Senate Journal as provided in Article IV, Section 4, of the Constitution of the State of South Dakota.

    The question being "Shall SB 96 pass, the veto of the Governor notwithstanding?"

    And the roll being called:

    Yeas 0, Nays 33, Excused 2, Absent 0

    Nays:
Bradford; Brown; Buhl O'Donnell; Cammack; Curd; Ewing; Fiegen; Frerichs; Greenfield (Brock); Haggar (Jenna); Haverly; Heineman (Phyllis); Heinert; Hunhoff (Bernie); Jensen (Phil); Monroe; Novstrup (David); Olson; Omdahl; Otten (Ernie); Parsley; Peterson (Jim); Rampelberg; Rusch; Shorma; Soholt; Solano; Sutton; Tidemann; Tieszen; Van Gerpen; Vehle; White

    Excused:
Holien; Peters

    So the bill not having received an affirmative vote of a two-thirds majority of the members-elect, the President declared the bill lost, sustaining the Governor's veto.

    The Senate proceeded to the reconsideration of SB 100 pursuant to the veto of the Governor and the veto message found on page 622 of the Senate Journal as provided in Article IV, Section 4, of the Constitution of the State of South Dakota.

    The question being "Shall SB 100 pass, the veto of the Governor notwithstanding?"

    And the roll being called:

    Yeas 32, Nays 1, Excused 2, Absent 0

    Yeas:
Bradford; Brown; Buhl O'Donnell; Cammack; Curd; Ewing; Fiegen; Frerichs; Greenfield (Brock); Haggar (Jenna); Haverly; Heineman (Phyllis); Heinert; Hunhoff (Bernie); Jensen (Phil); Novstrup (David); Olson; Omdahl; Otten (Ernie); Parsley; Peterson (Jim); Rampelberg; Rusch; Shorma; Soholt; Solano; Sutton; Tidemann; Tieszen; Van Gerpen; Vehle; White

    Nays:
Monroe

    Excused:
Holien; Peters

    So the bill having received an affirmative vote of a two-thirds majority of the members-elect, the President declared the bill passed, the veto of the Governor notwithstanding.



    The Senate proceeded to the reconsideration of SB 136 pursuant to the veto of the Governor and the veto message found on page 623 of the Senate Journal as provided in Article IV, Section 4, of the Constitution of the State of South Dakota.

    The question being "Shall SB 136 pass, the veto of the Governor notwithstanding?"

    And the roll being called:

    Yeas 32, Nays 1, Excused 2, Absent 0

    Yeas:
Bradford; Brown; Buhl O'Donnell; Cammack; Curd; Ewing; Fiegen; Frerichs; Greenfield (Brock); Haggar (Jenna); Haverly; Heineman (Phyllis); Heinert; Hunhoff (Bernie); Jensen (Phil); Novstrup (David); Olson; Omdahl; Otten (Ernie); Parsley; Peterson (Jim); Rampelberg; Rusch; Shorma; Soholt; Solano; Sutton; Tidemann; Tieszen; Van Gerpen; Vehle; White

    Nays:
Monroe

    Excused:
Holien; Peters

    So the bill having received an affirmative vote of a two-thirds majority of the members-elect, the President declared the bill passed, the veto of the Governor notwithstanding.

MOTIONS AND RESOLUTIONS

    Sen. Frerichs moved that the rules be suspended for the sole purpose of introducing, giving first reading to, dispensing with committee referral, and placing on today's calendar a bill relating to revising the definition of fall enrollment for the purpose of education funding.

    The question being on Sen. Frerichs' motion that the rules be suspended for the sole purpose of introducing, giving first reading to, dispensing with committee referral, and placing on today's calendar a bill relating to revising the definition of fall enrollment for the purpose of education funding.

    And the roll being called:

    Yeas 13, Nays 20, Excused 2, Absent 0

    Yeas:
Bradford; Buhl O'Donnell; Frerichs; Greenfield (Brock); Haggar (Jenna); Heinert; Hunhoff (Bernie); Jensen (Phil); Parsley; Peterson (Jim); Rampelberg; Sutton; Van Gerpen


    Nays:
Brown; Cammack; Curd; Ewing; Fiegen; Haverly; Heineman (Phyllis); Monroe; Novstrup (David); Olson; Omdahl; Otten (Ernie); Rusch; Shorma; Soholt; Solano; Tidemann; Tieszen; Vehle; White

    Excused:
Holien; Peters

    So the motion not having received an affirmative vote of a two-thirds majority of the members-elect, the President declared the motion lost.

    There being no objection, the Senate reverted to Order of Business No. 5.

REPORTS OF STANDING COMMITTEES

MR. PRESIDENT:

    The Committee on Legislative Procedure respectfully reports that SB 48 and 172 were delivered to his Excellency, the Governor, for his approval at 11:55 a.m., March 11, 2016.

Respectfully submitted,
Gary Cammack, Chair

    Sen. Brown moved that the Senate do now recess until 12:30 pm, which motion prevailed and at 11:38 am, the Senate recessed.

RECESS

    The Senate reconvened at 1:04 pm, the President presiding.

REPORTS OF STANDING COMMITTEES

MR. PRESIDENT:

    The Committee on Legislative Procedure respectfully reports that the House and Senate have, pursuant to the recommendation of the Governor as to corrections in style and form of SB 65, approved the recommendation and that the Office of Enrolling and Engrossing has engrossed the changes and has returned the same to his Excellency, the Governor, at 12:43 p.m., March 29, 2016.



Also MR. PRESIDENT:

    The Committee on Legislative Procedure respectfully reports that the House and Senate have, pursuant to the Governor's veto of SB 96, sustained that veto and delivered the same to her Excellency, the Secretary of State, for filing at 12:02 p.m., March 29, 2016.

Also MR. PRESIDENT:

    The Committee on Legislative Procedure respectfully reports that the House and Senate have, pursuant to the recommendation of the Governor as to corrections in style and form of SB 64, not approved the recommendation and has returned the same to his Excellency, the Governor, at 1:05 p.m., March 29, 2016.

Respectfully submitted,
Gary Cammack, Chair

MESSAGES FROM THE HOUSE

MR. PRESIDENT:

    I have the honor to inform your honorable body that the House has not approved SB 64 as recommended by the Governor, pursuant to Article IV, Section 4, of the Constitution of the State of South Dakota, for changes as to style and form.

Also MR. PRESIDENT:

    I have the honor to inform your honorable body that the House has approved SB 65 as recommended by the Governor, pursuant to Article IV, Section 4, of the Constitution of the State of South Dakota, for changes as to style and form.

Also MR. PRESIDENT:

    I have the honor to inform your honorable body that the House has sustained the veto of the Governor on SB 100.

Also MR. PRESIDENT:

    I have the honor to inform your honorable body that the House has sustained the veto of the Governor on SB 136.

Respectfully,
Arlene Kvislen, Chief Clerk

CONSIDERATION OF REPORTS OF JOINT-SELECT COMMITTEES

MR. PRESIDENT:

    Your Joint-Select Committee appointed to wait upon his Excellency, the Governor, to inform him that the Legislature has completed its labors and is ready to adjourn sine die and to ascertain if he has any further communications to make to the Legislature, respectfully reports that it has performed the duty assigned to it and has been informed by his Excellency, the Governor, that he will not appear for the closing of the Ninety-first Legislative Session.

Respectfully submitted,    Respectfully submitted,

Dean Wink    Gary Cammack
Brian Gosch    Corey Brown
Spencer Hawley    Billie Sutton
House Committee    Senate Committee

    Sen. Brown moved that the report of the Joint-Select Committee relative to informing the Governor that the Legislature has completed its labors and is ready to ascertain if he has any further communications to make to the Legislature be adopted.

    Which motion prevailed.


Also MR. PRESIDENT:

    Your Joint-Select Committee appointed to consider the matter of adjournment sine die of the Ninety-first Legislative Session respectfully reports that the Senate and House of Representatives adjourn sine die at the hour of 1:08 p.m., March 29, 2016.

Respectfully submitted,    Respectfully submitted,

Dean Wink    Ernie Otten
Brian Gosch    Deb Soholt
Spencer Hawley    Billie Sutton
House Committee    Senate Committee

    Sen. Brown moved that the report of the Joint-Select Committee relative to fixing the time to adjourn sine die be adopted.

    Which motion prevailed.


    There being no objection, the Senate reverted to Order of Business No. 7.

MESSAGES FROM THE HOUSE

MR. PRESIDENT:

    I have the honor to inform your honorable body that the House has adopted the report of the Joint-Select Committee for the purpose of fixing the time of adjournment sine die for the Ninety-first Legislative Session.

Also MR. PRESIDENT:

    I have the honor to inform your honorable body that the House has adopted the report of the Joint-Select Committee for the purpose of informing his Excellency, the Governor, that the Legislature has completed its labors, is ready to adjourn sine die, and ascertain if he has any further communications to make to the Legislature.

Respectfully,
Arlene Kvislen, Chief Clerk

    The following prayer was offered by Pastor Sarah Goldammer.

    Almighty God,

    We lift up our voices to You in these last minutes of the Ninety-first Legislative Session. We thank You for the health and strength You have given, so that this work may be done.

    We thank You for the staff, aids, interns, pages, and elected officials who have answered the call to serve the people of South Dakota. We ask that You would prosper all that has been done according to Your will, and pardon all that has been done amiss.

    As we end this session, we ask Your continued blessing on us and that we would continue to do Your work to seek Justice, honor life, and uphold freedom.

    In Your name we pray, Amen.

    Sen. Brown moved that the Senate do now adjourn sine die, which motion prevailed and at 1:08 p.m. the Senate adjourned.

Kay Johnson, Secretary



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