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Don't Be Confused (Part 2)

Yikes! The section below on School Board “Opt Out” has the potential to cause brain damage to people with common sense. Read with caution.


Check out the agenda items for the Sioux Falls City Council meeting. A lot of dense residential housing rezoning going on.

Sioux Falls City Council Meetings

Lincoln County Commissioner Meetings


“If you're not confused, you're not paying attention.” ― Tom Peters

People probably think voting to Opt Out of something regarding taxes would result in NOT raising their taxes, right? WRONG! In South Dakota, it means the exact opposite. When a school board Opts Out, it is voting to “opt out” of the state funding formula that LIMITS funding INCREASES in a school district. that so far?

The state funding “limitation” law isn’t really a limitation. It’s more like a suggestion. The School Board says “we want to spend $X, but the state limitation is $Y, so we’re going to vote to ignore that limitation and ask the town council to pony up the extra $Z in tax levies," which they likely will because nobody in the district knows what’s going on until they get a big property tax hike. There are some regulations for the Board to follow to make this tax hike legal.

The decision to opt out must be published within ten days of the decision. It can be referred to a vote upon a petition signed by at least five percent of the registered voters in the taxing district and filed within twenty days of the first publication. (That might work in a town of a thousand people, but is unlikely to work in a city unless there is a well-oiled machine in place.) Even if the opt out IS referred to a vote and defeated, the Board may opt out again “prior to July 15 of the year prior to the year the taxes are payable.” Huh?

The links below explain the inexplicable “opt-out” process in detail. If the details seem overwhelming, it’s because they are.

Bottom line

An Opt-Out is actually opting INTO higher taxes. As inflation (8% to 9% at this writing) makes district residents poorer and they have to adjust their own budgets, school boards can increase their budgets and spending and make district residents even poorer.

Because the rules as written make a Citizen Challenge nearly impossible in a densely populated district, this effectively gives school boards the ability to raise taxes on people in their districts, and people don’t even know it’s happening.

Challenge: How can a well-oiled opt-out response machine be developed? Stay tuned…

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