Proponent group’s finances are intermixed with abortion-rights campaign
By: Joshua Haiar,
SD Searchlight
Twenty-five South Dakota companies and organizations have contributed money to defeat a tax-repeal measure on the Nov. 5 ballot, while the supporting group’s fundraising is difficult to analyze because of the group’s dual focus on the tax measure and an abortion-rights amendment.
Initiated Measure 28 would remove the 4.2% state sales tax on anything sold for “human consumption,” excluding alcohol and prepared food. Supporters intend the measure to repeal state sales taxes on groceries. Opponents say the measure is poorly written and would apply to a broader array of goods and services.
The opponent committee, South Dakotans Against a State Income Tax, raised over $200,000 since its formation in June and spent about $90,000, according to new campaign finance reports. The committee’s name comes from the claim by some Initiated Measure 28 opponents that sales tax revenue losses from the measure could eventually lead to an income tax.
The proponent committee, Dakotans for Health, took in about $840,000 since its last report in May. A large portion of that — $540,000 — came earlier this week from a political nonprofit, Think Big America, founded by Democratic Illinois Gov. J.B. Pritzker to support abortion rights nationwide.
Dakotans for Health circulated the petitions to put the sales-tax measure and an abortion-rights measure, Amendment G, on the ballot. Dakotans for Health’s campaign finance reports include its total fundraising and do not distinguish between money raised or spent for one measure or the other. As of earlier this week, Dakotans for Health had spent about $300,000 on advertising.
Other notable contributions to Dakotans for Health include:
• $100,000 from Michelle Locher, a Florida resident who also donated $1 million to a political action committee supporting Florida’s proposed constitutional amendment on abortion rights.
• $10,000 from Jim Conyngham, of Austin, Texas.
• $10,000 from Barb Christianson, a Rapid City resident.
• $5,000 from Tom Daschle, a Democrat who formerly represented South Dakota in the U.S. Senate.
South Dakotans Against a State Income Tax is chaired by Sioux Falls Mayor Paul TenHaken and lists Nathan Sanderson, executive director of the South Dakota Retailers Association, as its treasurer.
Among the contributing groups are the Retailers Association, South Dakota Farm Bureau Federation, South Dakota Education Association, the South Dakota Licensed Beverage Dealers and Gaming Association Political Action Committee, the Sioux Falls Development Foundation, South Dakota Bankers Association, and South Dakota Pork Producers Council.
The group has also received some large individual donations, the biggest one being a $10,000 contribution from Dana Dykhouse, CEO of Sioux Falls-based First PREMIER Bank. There are no limits on contributions to ballot question committees in South Dakota.
TenHaken has come out against the food tax repeal over concerns it would remove taxes on more than groceries, and because he and other mayors are concerned that the measure could impact cities’ ability to collect sales taxes.
The South Dakota Legislative Research Council estimates the measure could cause state revenue losses between $134 million and $646 million annually, depending on how it’s interpreted. The South Dakota Municipal League says revenue losses for cities could total $51 million annually.
Supporters say the measure would not impact cities, and its impact to the state would be at the lower end of the estimates. They say revenue lost to the state would be retained as savings by grocery shoppers, including the low-income South Dakotans for whom the measure was drafted.
Among the 45 states that collect a statewide sales tax, South Dakota is currently 36th in combined state and local rates, making its combined rate one of the lowest, according to the nonprofit and nonpartisan Tax Foundation. South Dakota and Mississippi are the only sales-tax states that apply their full tax rates to groceries.
South Dakota Searchlight is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. South Dakota Searchlight maintains editorial independence.
