The city has over $80 million in reserves and many councilors questioned why it was so high. Of course the finance director did his best telling councilors we needed to have record reserves to save for a rainy day (or a derecho).
There are two reasons why we are at this point, the first one is the obvious flush of Federal money. As I understand it the city had many projects planned with our own capital before the pandemic and once the money started flowing in the city started allocating ARPA money to these projects instead of city capital. We can argue all we want about the ethics of that kind of budgeting, but I think the public is really in the dark about how this works. Of course the finance director started questioning the Federal bailouts and blaming them for massive inflation which is hilarious coming from a dude who gladly cashed the Fed’s checks.
The second reason we have record reserves is that we are being overtaxed. This of course was NOT brought up by the finance director during the meeting but councilor Neitzert touched on it by saying there is a perception that the city is hoarding money and they shouldn’t be doing that.
This has been my argument all along against increasing city property taxes every year. The city has the revenue, but more importantly with our population and development growth (almost $2 billion last year) there is no reason to increase these taxes and fees due to natural economic growth.
So why are we in this position? Because of indiscriminate tax rebates and TIFs to developers. If we eliminated this high-end socialist welfare system to wealthy developers we could keep our property taxes down.
We also need to stop giving money away to play palaces.
We can’t on one hand and say we are in dire straits then turnaround and throw millions away on amenities and wants. We are either one or the other. The city coffers are NOT a savings account, they collect fees and taxes and spend them on the social welfare of our city.
If I were a city councilor I would propose a one-time city property tax rebate and chip away at the city’s trough.
I never believed Noem truly wanted this tax cut and was probably secretly giddy it failed. I would be shocked if ANY tax cut is approved this legislative session. Playing the Devil’s advocate, why would those who control the coffers want to eliminate a reliable revenue source?
If I were a legislator the prudent thing to do would have been a step reduction in the food tax (eliminating 1.5% this year and 1 penny the following three years and on the 5th year eliminate the municipal food tax portion).
I personally support the property tax cut. While they contend it will only save taxpayers around $300 a year it is around a $800 savings each year in Sioux Falls (that is the approximate take of the SFSD for a $100K valuation). The food tax cut would only save me about $150 a year. As for helping the poor with a food tax cut that is a false flag (an overall sales tax reduction would have a bigger impact). Since most legitimately poor in our state receive food from food banks, FREE school lunches, WIC, churches and SNAP they pay NO taxes on food so why not give them real savings by reducing the overall sales taxes on anything purchased (especially on cigs and beer their biggest staples đ I also think there should have been legislation to eliminate sales taxes on gas and electricity (something renters and homeowners both pay). As I said from the beginning, I donât think our legislature has the courage to cut taxes. As my stepdad used to say, âGutless Wondersâ.
DakotaNews chief softball pitcher, Brian Allen, recently did an interview with Paul asking him what we should focus on in 2023. Paul said it was time to get back to focusing on infrastructure.
I guess it only took 5 years for Paul to figure out the simple premise of local municipal government; you collect taxes and fees and provide essential services like road maintenance, water and sewer, public safety and outdoor recreation in our parks.
Ever since Mayor Munson, the city has focused more and more on chipping away at our 2nd penny for things like leather chairs for a private movie theater, landscaping and ‘other stuff’ for a private research facility, butterflies and tennis courts while giving massive tax breaks to welfare queen developers.
When former city commissioner Loila Hunking proposed the 2nd penny tax decades ago it was to be in a lockbox and only to be used on road maintenance and in rare occasions other infrastructure projects, since then the penny has been on a wild spending spree that has little to do with the pothole in front of your house.
It often cracks me up listening to past and current mayors and city councilors talk about how we need to ‘get back to’ focusing on infrastructure.
Don’t be fooled by the promises. There is going to be a big fight in Pierre this winter over reducing the food tax and property taxes, one of the proposals will win at the end of the day (I think the property tax cut has a better chance). Mayors and councilors across the state will be crying about the revenue loss and will be asking how they will be able to keep up with essential services and infrastructure.
Let me give you a little advice; stop spending our tax dollars on stupid sh!t.
I am not surprised this happened. Over the past decade I have watched the integrity of the legal descriptions in ordinances deteriorate substantially and it seems almost weekly the council is amending some mistake or typo (Item #96);
This would have been quite the boo-boo.
This past year the Building Services manager had to apologize to the city council for screwing up on a fee adjustment that wasn’t caught by the council or attorney’s office but by a contractor.
The BID Tax increase was deferred because a couple of DTSF business owners cried. I don’t see any amendments and I don’t expect any tonight, this will pass easily. The Billionaire Italians bitching about this increase can afford it, oh, and will DTSF hang some damn xmas lights at Sunshine already!
âBecause it would exempt the first $100,000 in valuation from taxing,â Ladner said. âRather than a proportional cut, South Dakotans with smaller home value will get a bigger percentage tax cut from this mechanism.â
In Sioux Falls that would be about $1,500 a year tax break. Of course, I doubt this even gets out of committee considering towns, schools and counties will push back on it. It would help a lot of first time homebuyers getting into a starter home and the elderly on a fixed income.
Them’s some fancy words from our chief finance bull thrower (FF 52:00)
So what is a structural deficit?
the amount by which a government’s spending is more than it receives in taxes in a particular period, whether the economy is performing well or not
Mr. Pritchett made this wild claim at the city council meeting last night, and six of the councilors agreed with him.
It is total nonsense.
As one citizen pointed out the way to not produce municipal debt is to budget better, in other words do the job we elected you to do. He also pointed out that this $2 million dollar increase is less than 1% of the total budget and can easily be made up.
The problem is for decades the city has implemented the piling on approach to building the yearly budget instead of doing zero based budgeting each year. This has caused bloated department budgets.
As for property taxes, valuations in Sioux Falls have skyrocketed over the past 3 years driving property taxes up with or without government intervention.
Even if the economy was doing great right now, this natural FREE market increase makes up for any inflationary increases we may need.
We also have given millions away in TIFs.
It cracks me up that the city council would nickel and dime $50K for the Siouxland Heritage endowment fund and $68K for an arts coordinator, but doesn’t blink an eye approving $50 million in TIFs for parking ramps attached to luxury condos.
That’s our council doing the important work, making sure developers, banksters and bondsters are happy and well fed.
I’m starting to think the only structural deficit the city has exists between the ears of our councilors.
During the City Council meeting last night (FF 1:25:00) Pat and David spoke out against the increase siting inflation hurting citizens;
“. . . we have families struggling with high inflation and I am NOT comfortable with a property tax increase,” David Barranco.
“We sit and talk about putting the city in good financial shape and it really doesn’t take that much from the citizens, it’s only a couple of bucks here, and it’s a Coke or a cup of coffee, but if look at the chart director Pritchett presented were talking about 11 to 12 million dollars over the next 10 years that the city will be ‘SHORT’. NO, it’s the taxpayers that will be short of this money,” Pat Starr.
Their colleagues on dais SAID nothing while voting to move to 2nd reading. Starr and Barranco voted NO.
You gotta love our new found transparency with the annotated agenda and this explanation for a property tax increase (Item #59);
Background & Objective: The ordinance appropriates the tax-supported funds as part of the 2023 budget in the amount of $384,337,184 and establishes property tax revenues to be collected including the 3% inflationary adjustment as provided in South Dakota State Statute.
Even though it says right in the title of the agenda ‘INCREASE’ they explain it as an adjustment.
With inflation thru the roof and property values skyrocketing over the past year, this would be a fine time to actually CUT the property tax by 3% instead. I am hoping at least one councilor has the backbone to bring an amendment on the second reading.
Sioux Falls Citizen Mike Zitterich says it best in an email sent to council;
As we begin the final preparations to approve the 2023 Fiscal Budget over the next coming weeks, let’s remember, we are currently in a recession of which many Americans are struggling to put gas in their car, food on the table, pay rents, let alone survive. We can debate all day long whether we have a good or bad economy, based on the # of building permits, or tax dollars coming into the treasury, but let’s stop and remember, the city is very fortunate to be in a position it is in, where its effective tax revenues have remained consistently at or above previous levels. Lets also remember, just cause our direct property based taxes – Sales Tax on goods and services, and Property Tax assessed to the value of land are all based on the direct assessment of how much ‘income’ the residents of the city have, and if their incomes are restricted, then the city has some decisions to make. I have often called attention to the formality of the City Spending more than the actual state and local tax dollars received, while we have a tax base of nearly $400,000,000 million dollars, this city council body is approving a spending budget of nearly $700,000,000 million dollars. As I have done over the past 3 years, I have made the people aware of this huge deficit in public spending, in hopes to help educate the residents. That is essentially what we have here, a “Spending Deficit“
As for Agenda Item #59 – the Property Tax Assessments, there is no law that says we can or not increase the amount the ‘government’ is begging for, YOU GUYS have the lawful ability to apportion LESS, thus cutting the budget by a specific dollar amount.
The city really needs to move towards ZERO based budgeting each year to get the spending under control, but that would require the city council to actually do their jobs. You will notice that this week’s agenda has 67 items in which the mayor sponsors almost every single one besides private applicants. There are ZERO items sponsored by our legislative and policy body. I have argued that the mayor should have to get at least one councilor to co-sponsor his items.
As discussed earlier in the week, DTSF wants an increase to their special tax. But if you read the agenda item (Resolution #64). You will notice there is NO mention of an increase, just a renewal;
Section 1. That the 2022 special assessment roll for the Main Street Business Improvement District in the City of Sioux Falls, SD, is hereby approved. The assessment as set out in said special assessment roll approved this date is hereby levied against the property described therein and becomes a lien against such property upon filing of said special assessment roll in the City Finance Office.
I find it curious that The Dakota Scoutbrought this story forward with NO prior presentation or explanation from the city. So will there be an increase? And if so why is it NOT on the agenda?
DTSF has been trying to convey that need to its members who are subject to the special assessment. And earlier this year, the Main Street BID Board, made up of property owners and other downtown stakeholders, unanimously recommended the proposal be carried forward to the City Council.
Okay. So when was the public going to be told? One minute before the vote? Ridiculous.
The biggest issue before the upcoming city election isn’t just affordable housing it is how the city is misappropriating millions in tax surpluses from 2021. (Item #86)
Typically surpluses from the previous year are not given out or appropriated in the following year until a financial report from that year is presented to the public and city council in a public meeting.
It should certainly NOT be given out before an election. The council, that normally controls the purse strings should have gotten the report and had public working sessions with public comment to determine how this money is to be spent, and it should have happened after the election.
Instead, the mayor is keeping information from some of the councilors and certainly from the public and secretly appropriating this money as booty prizes and then dropping it in councilors laps to approve. It’s a violation of the charter and certainly an ethical violation, it may even violate campaign rules.
In my humble opinion, with $74 million in surpluses the best way to spend this money is to give tax rebates to the core neighborhoods for property owners to spend it on home and neighborhood improvements (stipulated). Instead of complicated grants and added bureaucracy, just give it back to the taxpayers and have them decide how they will spend the money.
It’s bad enough we have been overtaxed, but to turn around and hide it from the council and public and to hand it out to the mayor’s special friends is just sickening, especially right before an election.
At a project site near Colton, Golden West Telecommunications CEO Denny Law said the price of fiber-optic cable has gone up 15-50% since 2018. Â Â Â Â Â Â
It's setting up to be another hot day in much of KELOLAND. However, we do have a better chance of scattered rain this afternoon across the east. More on the that story in moment. Highs yesterday reached the mid 90s in many areas from Aberdeen to Sioux Falls, a growing sign of the dry weather […]
