Entries Tagged 'Taxes' ↓

The SD Republican Party & their ‘Goofy’ ads

Forget about my legislative experience, let’s talk Bible.

It’s one thing to put out ads that are just blatantly false, but some of the candidates for the primary are just blatantly ridiculous. I wonder if the SD GOP has depended on SD voters being ignorant and naïve for so long, they just expect any crap they throw at the wall will work.

Let’s start with Shantel Krebs. She wants to ‘drain the swamp’ (still don’t know what that means) and build a wall. I won’t comment on Trumpian talking points, but seriously Shantel?! Build a wall?! Are we afraid too many Mexicans are coming here from Nebraska? Mexicans have been immigrating to the Midwest for over a century. Not sure how building a wall is even an issue in South Dakota. How about finding a way to increase wages in SD so the Mexican immigrants stop taking our jobs.

Let’s move on to Marty Jackboots, who seems to be talking out of both sides of his mouth lately, wait, he has always done that. In his ads he talks about keeping taxes low, than turns around and runs to DC to enforce South Dakotans have to pay online sales taxes. So which is it Jackboots? Let’s face it, sales taxes are extremely regressive, and as the economy continues to tank, more ways to bleed water out of a rock are not sustainable. It’s time to reduce sales taxes to luxury items only and implement a state income tax.

Oh, and who can leave out Princess Noem. Apparently she is qualified to be governor because in her latest ad her supporters say she believes in God and has figured out reproduction. This one actually confuses me. Instead of touting her DC experience and Pierre experience they talk about God and Sex. Weird.

I’m sure after the primary things are going to get even more strange.

Sioux Falls tax collection Jan/Feb 2018

This is from the SD Retailers Association. This is a ‘Grand Total’ as you can see from the disclaimer.

Word is though that occupancy rates are way down from last year.

Why has the entertainment tax collection been dropping since The Denty opened?

Well, I don’t know the answer to that question. BUT, I have speculated quite often on this. I have often argued that the Denty has actually been a financial drain on our city, and not just in a mortgage payment.

So why is it with so many people coming to Sioux Falls for sold out shows at the Denty the entertainment tax has been dropping?

My theory is that more and more people are dropping their entertainment dollars on tickets at the Denty, those dollars go directly to the artists and promoters and directly out of town. In other words, they are not spending that money on authentic local entertainment. Not only has it caused collections to go down, it is NOT getting recirculated in the community.

While it is nice we can see world class acts in Sioux Falls now, it has acted like a vacuum taking money out of the coffers of local entertainment.

Ironically the Mayor had a press conference today peddling more lies about how ‘profitable’ the Denty has been. He said that after operational costs, it made $2.1 million PROFIT last year. Ironically they never discuss the $10 million mortgage we pay out of our 2nd penny road tax. They also don’t mention that the city only holds the account on this FAUX profit that SMG controls. In other words, the city coffers (us) never sees the $2.1 million left over after operational expenses. The only money we take in at the end of the day is the $1.9 million in sales taxes it generated last year, which still leaves us far in the hole after paying the mortgage.

He also thanks the voters for passing the Denty with a FAKE, non-legally binding advisory vote. If the voters would have had a LEGAL bond vote on the EC, it would have never passed.

Why is the city playing a timeline game with the end of the year financial report?

While Sioux Falls Finance Director is correct that over the past 3 years the financial report has not come out sooner than the beginning of April, it hasn’t always been a strict timeline. In fact if you look at the last three reports it has been all over the map.

In 2015 it was created on May 29. In 2016 it was created on June 27 and the 2017 report was created on April 6 (the earliest).

In other words the administration could have easily released the numbers by now. We already know they are available from the State Department of Revenue, and since there has NEVER been a strict timeline, and with an election year, why not release those numbers by the end of February? The state has figured out how to put those numbers together (before the legislative session) probably with a smaller staff than the city.

This is just a game the mayor is playing that doesn’t have to be played.

Watch him closely, he will be playing games with city finance and budgeting all the way to the end.

Lyft drivers should have just kept mouths shut about cash tips

Sometimes I just shake my head when people shoot themselves in the foot. Of course, not sure who did the shooting? May have been councilor Neitzert who is also a Lyft driver (according to Belfrage). Greg was proposing an ordinance change but probably can’t now since it would be a conflict.

Apparently city ordinance says Lyft or Uber drivers can’t receive cash tips (they do anyway). But now if ordinance changes they will have to claim on taxes. Now, since it is policy NOT to receive tips, though they probably do, they don’t have to claim those tips.

If I was a Lyft driver I would not have said anything about it. Oh well. More government regulation, less money for the worker bee.

Mayor Huether admits to having 2017 end of the year financials, continues to selfishly sit on it.

If you watch the video below you will hear Mike talk about the stable financial situation the city is in, he even admits to seeing the end of the year numbers from 2017. So why hasn’t he released these numbers? If not to the public, at least our legislative body, the city council.

But it would be helpful to the candidates who are running for city council and mayor so they can discuss how they will budget moving forward. But according to Mike it doesn’t matter because the candidates are liars and idiots. Of course he doesn’t use that terminology but does say they are sideline quarterbacks that are saying things that are ‘untrue’. You know, because no one does a better job of hoodwinking the public like he does.

How are the candidates supposed to give us their vision for the city if you sit on important information like this?

I have a feeling Mike and his financial team are busy ‘massaging’ the numbers. Which is stupid anyway. It’s not the administration’s fault if sales tax revenue is down, that’s just reality. A word the mayor struggles with.

He often wonders why people are critical of the things he does, it’s because he continually hides information from the public. Release the end of the year numbers without a fancy circus press conference. The public deserves to see how we did last year.

If you are visiting a tourist site, that makes you a tourist

Sometimes I think it may be a good idea to drug test legislators, especially when they come up with stupid crap like this. You are either brain dead or on drugs killing your brain cells;

The bill would cut the state’s tourism tax rate from 1-1/2 percent to 1 percent, which wouldn’t leave enough funding for the South Dakota Arts Council.

State Rep. Tom Pischke (R-Dell Rapids) sponsored the bill because he doesn’t like the way the money is collected.

“Let’s say for example, I live in Dell Rapids and I want to take my kids to the children’s museum in Brookings. So I don’t really consider myself a tourist if I drive 30 miles up to Brookings to take the kids to the Children’s Museum. But then again, I’m getting charged a tourism tax,” says Pischke.

The definition of Tourist;

a person who is traveling or visiting a place for pleasure.

Doesn’t matter if Tom lived next door to the museum, he is still a tourist. Oh, but Tom’s argument gets even better;

Pischke says he supports the arts, but doesn’t think the tourism tax should go toward things the SculptureWalk or JazzFest, two recipients of funding from the state art council. He says the collected funds should go directly toward tourism.

Public art is tourism. Do you think people would travel to Mt. Rushmore if there wasn’t a sculpture into the side of that mountain? Where do these legislators come up with this stuff?

How many South Dakota State legislators does it take to screw in a light bulb? Zero. They would be too busy arguing over how to pay for the light bulb, in the dark.

Why do property tax rates continue to rise in Sioux Falls?

After watching the Sioux Falls school board meeting last night about the possible Sanford donation of land for another school, it got me thinking about property tax rate increases.

Since I have purchased my home about 15 years ago my property taxes have over doubled. In that time I had one small equity loan and a re-finance. Most of the increases have come from rate increases. While I can understand a rate increase with a community that has slow building and housing growth, that hasn’t happened in Sioux Falls. In fact when you think about record building permits over the last five years and the hot seller’s market in housing you would think that rate increases would not be needed due to this massive growth.

There are several ways increases happen. The city can raise property tax rates each year, and they have every year for probably the past 20 years or longer. Minnehaha county also has had several opt-outs along with the school district and now with a new high school looming in 2019, get prepared for another BIG increase in our property taxes.

It also doesn’t help that the county has to fund the drastic increase in criminal justice services through our property taxes. The city really should be helping to pay for incarceration with the 2nd penny and the alcohol tax really should be doubled to help alleviate those costs. It would also help if our PD was properly staffed, trained and paid to help combat crime through prevention instead of whack a mole.

That is why I am confused about the math. How can we continue to add housing and commercial property and have several press conferences about this growth yet have to raise rates consistently? So which is it? Is the massive growth adding to the tax rolls? Damn right it is. So are we being over taxed on our property? Probably, especially on private housing.

Part of the problem is all the cheerleading about building permits is kind of a false pep rally. Many of the big projects in our community are public or non-profit projects. And the ones that are not are getting TIFs or other tax abatements. In other words, the big wheels in town are seeing some big tax cuts while the rest of us are ponying up for infrastructure through higher taxes for projects like Flopdation Park.

The system is clearly broken and the city, school district, county and state need to take a different approach to funding government instead of constantly increasing our property taxes. I had a few solutions above, but I also think we should suspend or end the TIF program. It hasn’t proven that it pays for itself through workforce development or providing affordable housing. TIFs are corporate welfare in Sioux Falls and little else. I would encourage the next mayor and council to seriously look at ending this program and initiating different programs for developers like deregulation to save them money.

Let’s face it, if you are working class in this city you are getting the shaft when it comes to taxes (and don’t think apartment dwellers are immune, the high rental rates are proof property tax rates are high). Sales taxes are also very regressive. Taxing food at a higher rate to supplement teacher was and is a bad idea.

It’s time to stop the incremental property tax rate increases and use common sense when funding essential government services.

How much does The Denty contribute to it’s mortgage payment? Very Little.

Did you know that the mortgage payment on The Denty is around $10 million a year? Did you also know we pay that debt service out of one of our 3 pennies our city takes in for revenue? We pay debt service on all of our bonds out of the 2nd penny, money originally set aside a long time ago by city commissioner Loila Hunking for ROADS and other infrastructure.

Of course, if The Denty is contributing to that 2nd penny, it does with help with the mortgage payment – we will get to that contribution shortly.

We heard it just about a month ago, Garth Brooks sucked $7 million in ticket sales out of our town straight into his pocket. The news today, the Foo Fighters (which I contributed to) had record ticket sales, guess where? At The Denty where they sucked a record $1,018,273 out of town, FROM ONE CONCERT! That is an average $93 per person. Guess how much we garnered for the 2nd penny on the Foo Fighters show from ticket sales? $10,182. Woot! Woot!

While I have been asking for numbers from the city for awhile about how much money we are making from The Denty (that could contribute to the mortgage payment) I haven’t gotten very far, but I did get a small breakthrough today.

According to the City’s Finance Director The Denty collected $1,824,710.19 in tax revenue for 2016. If you break out the 3 pennies we get (The state gets 4.5 pennies) we took in $729,884 and if you break it down to single pennies, since the 2nd penny is the only one we use to pay debt, it comes to $243,295, hardly a ‘dent’ (excuse the pun) in the mortgage payment.

Yes it is true besides the taxes that The Denty collects, their is an economic impact. My guess is at the highest it would probably be about 3x what The Denty brings in. You have to figure that half already live in Sioux Falls and the other half probably spends a majority of their money at The Denty since we built the facility along the interstate and not in the center of an entertainment district, visitors drive straight there, spend there money there, then drive straight home.

But the almighty Finance Director also fills us in on some other interesting information. Doesn’t the city get a share of the profits SMG makes off of the The Denty?

Ah, not really. Here is how he explained it in a recent email to council;

Revenues generated for SMG as a private sector company are limited to the fees paid to SMG as set out in their contract with the City: a base fee and, if earned, an incentive fee.  These fees are how SMG makes its money as a business.

Revenues generated from the operation of the City’s facilities (DSPC, Convention Center, Arena, Orpheum Theater) are revenues to the Operating Account managed on the City’s behalf by SMG.  Revenues to the Operating Account include rental fees, charges for additional services provided to guests that rent the facilities, ancillary revenues (food & beverage commissions, novelty sales, parking charges, suite cleaning, facility fees, etc.) and marketing & sponsorships (advertising, naming rights, suite leases, loge box leases, club seat fees).  All revenues generated from these sources are deposited into the Operating Account and are used to pay the costs of running the facilities (payroll, utilities, cleaning & maintaining the facilities, SMG’s management fees, internet/telephone, office supplies, insurance, etc.)

In small man’s word’s, any money The Denty makes that isn’t collected tax revenue goes straight back into a fund to support the building. In other words, while SMG and it’s management make money and are able to pay the light and garbage bill, they are contributing NOTHING to the mortgage payment. Zilch. SMG is essentially making a profit and paying rent.

I’ve said all along, The Denty wasn’t built for you and me, it was built to make a bunch of bond investors and construction company owners a lot of money. You have to realize out of the $180 million dollar payoff $65 million is interest payments. That’s $65 million that won’t be spent on our roads and handed directly over to private bond investors.

I still think we could have built The Denty with a combination of private investors and money from the state’s investment funds (that we would pay back in no interest or very low interest payments). Instead we decided to go it alone, built it in the wrong location, an don’t require the profits from the facility to pay off the debt.

The f’cked up siding is one thing, but the finances of this place are a total disaster. And the mayor calls himself a ‘banker’. LMFAO!

Councilor Neitzert misses the mark on the Lloyd TIF

Sioux Falls city councilor Greg Neitzert was doing the 2nd half of his SE Podcast stint this Sunday.

He was asked about TIFs and specifically the Lloyd TIF. He did a fantastic job of explaining how TIF’s work (it is essentially a property tax rebate). He also made great arguments as to why the TIF for UPTOWN II was for good reasons. On the face he is correct. We are using the TIF money to clean up soil, old buildings, asbestos and constructing some minimal public parking. Like I said, on it’s face it sounds like a great use.

But let’s look at reality. First off, we have NOT collected a penny in property taxes on the land for over 11 years. Nothing. Zilch. ZERO.

The TIF (Tax rebate) will last for 13-14 years. We will essentially be getting little to no tax revenue from the property for almost 25 years.

But what makes this TIF controversial is the fact that Lloyd promised to buy this property in 2006 and for some strange reason we let it sit for 11 years, and the only real reason I can come up with is that we were HOLDING it for the developer (with no major retainer of down payment). One developer in a city that has dozens of high profile, successful developers that would have loved to get their hands on that land, some of said that.

I guess I will never know the reason why we held the land for Lloyd Companies (I was looking for it in the Siding Settlement, but couldn’t find it).

I do know this though. Within those 11 years the city did NOTHING to either sell the land, clean up the land (with EPA grants) or even send out any RFPs. Why? Doesn’t it seem strange that while we were getting $27 million in Federal Dollars for a plot of dirty RR land we didn’t set aside a few bucks to clean up this property, put in curb and gutter and parking and sell it?

While Neitzert makes some good points about the usage of TIFs, the deal with Lloyd stinks.

*Also an important note. All of the councilors who voted for the TIF (besides Neitzert) received campaign donations from Craig Lloyd and councilor Selberg earns his living as a broker for the Lloyd Companies (he did not excuse himself). Councilors Starr and Stehly (who have never gotten campaign donations from Lloyd) voted against the TIF.