Agriculture, gasoline tax top legislative to-do lists

Agriculture, gasoline tax top legislative to-do lists By Susan Smith and Jaimi Reimer Finding money for South Dakota's roads and adding value to its agriculture are two issues legislative leaders feel will drive the 74th session of the state Legislature.

Senate Majority Leader Michael Rounds, R-Pierre, and Senate Minority Leader Jim Hutmacher, D-Chamberlain said increasing transportation taxes to match federal funds will be the center of discussion.

"We're so behind on the roads, I think it's foolish not to utilize the federal funds," Hutmacher said.

An interim transportation committee supported measures that would double vehicle license fees, raise the state tax on gasoline and diesel fuel, raise trailer license fees and increase license fees for motor homes. House Minority Leader Pat Haley, D-Huron, said he thinks it's likely that the proposed 3-cent increase in the gas tax will pass, but is skeptical about the future of the license fee increases.

"The gas tax increase is going to be a very big issue," Haley said. "I think it's possible that gas taxes may go up."

Haley said as it stands now, the current gas tax does not raise enough revenue to meet a 20 percent match of federal funds available for improving South Dakota's state highways. For every 80 cents the federal government contributes, South Dakota must put up 20 cents, Haley said.

Rounds said if the 3-cent increase doesn't go through a 2-cent increase could be substituted, but he doesn't think there is much support for a 2-cent increase among legislators.

County roads are also in trouble as the price of repairs extends beyond money taken in, the legislators said.

A 20-year-old agreement allocates license plate fees for county road repairs and gives gas tax dollars to the state highways, Haley said. Increasing license fees that are among the lowest in the nation would be one way to help, Haley said. He said it may be time to include the county roads in the gas tax.

Haley said he was ready to vote in support of the gas tax increase, but wasn't sure about raising license fees.

"I will say this, the counties need help — I hope we can work something out," he said.

Something may have to be worked out to help the ailing ag economy as well, and the solution mentioned by legislators surveyed seems to lie with value-added agriculture.

House Speaker Scott Eccarius, R-Rapid City said he thinks the Legislature will look into subsidizing value-added agriculture to encourage processing as well as production. Hutmacher said he thinks value-added agriculture will be an issue to watch.

"We need to support agriculture, it's the lifeblood of the small communities," he said. "Every time we export a raw product, we export jobs right along with it."

Haley said in the past, value-added agriculture has been caught in a game of political football. But letting politics get in the way of improving the state's agriculture economy isn't practical right now.

"We need to get past that," he said. "The farm crisis lends urgency to it."

A bi-partisan effort needs to be focused on finding markets and funding for the state's ag products, Haley said.

Rounds said he thinks there will be discussion on what should be done rather than votes on specific projects because they haven't been proposed.

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