2023 Legislative Session



WOW! What a busy and exciting nine weeks of the 2023 South Dakota Legislative Session! We were able to accomplish many good things for South Dakota this year.

For starters, operationally, we were able to provide a seven percent increase for state aid to schools. This will help keep more teachers in South Dakota and keep this very important industry competitive with non-education occupations.

We were also able to provide a seven percent increase, plus some additional targeted dollars for state employees. Over the years, we have seen more vacancies in critical state job positions. These two wage packages will help the state provide the critical services needed for our great state.

We were able to provide a five percent increase for medical providers, plus some targeted dollars for specific provider groups. There are Medicaid dependent services that will receive the targeted dollars up to 100% of methodology – which means they will be paid close to their approved costs. In the past, we have typically paid up to 90% of methodology, but those critical care providers were falling farther behind in recruiting and supply costs, so this year’s boost will provide much needed support to get these providers stable for the coming year. In addition, the non-Medicaid dependent services also will see the boost from Medicaid Expansion, which will increase the volume of patients in their service areas, thereby providing an incentive to those services as well.

This last week of session saw a lot of debate about the tax cut. What was negotiated on the last day of session, was an overall sales tax cut from 4.5% to 4.2% beginning July 1st. This sales tax cut does have a sunset in four years, so we can expect this discussion to occur at that time as well. The importance of the tax cut sunset, is because the state revenues have been riding an economic high, and a short term tax cut makes sense, but mortgaging our future until we know the new normal is not fiscally responsible. Some examples include the federal stimulus bubble we have been on the last several years and expect it to continue for a little while longer, the last two years has had a Medicaid COVID enhancement that ends this year, the next two fiscal years have a Medicaid Expansion incentive, a new women’s prison opens and goes live in two years, and last, there is a ballot initiative to reduce the grocery tax at the next election. So, making the current tax cut permanent was concerning with such an uncertain state economic future.

Other wins this session: we were able to pass SB41 – housing infrastructure loans and grants, SB16 – rail line rehab in northeastern South Dakota, tuition freeze at the universities and technical colleges, 100% tuition reimbursement for South Dakota National Guard members going to South Dakota colleges and universities, and updates to several software programs at the state that were “Brittle” and putting the state at risk. Additionally, there were several wins on election integrity; nine bills passed through the legislature on pre-election testing, voter roll cleanup, and post-election audits.

Some things that did not cross the finish line this year included the focus on eminent domain reform, county funding for regional jails, and funding for the dam at Hiddenwood Lake. I will take a few weeks to re-base, and then begin to look at ideas for legislative ideas to bring back next year or in future sessions.

We have one more day in our 2023 legislative session, veto day. So far, the Governor has vetoed four bills, so we will continue to be educated on those bills and have a discussion later this month before closing out the 2023 session.

As always, I can be reached at bryan.breitling@ sdlegislature.gov. I look forward to continued conversations!

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