Homeowners carrying brunt of South Dakota property tax burden

The state property tax assessment committee is continuing discussions on the impact of taxes on South Dakota homeowners.

South Dakota’s property tax structure is under constant scrutiny, from homeowners and lawmakers.

The state’s Study Committee on Property Tax Assessment Methodology met Tuesday to discuss the issues.

While conceding property taxes “stink”, Matt Krogman with the state Retailors Association said we could be in the middle of a change.

“We believe there is a shift happening, everybody worries about a shift when we talk about property taxes,” Krogman said. “We believe we’re in the middle of a shift right now, and the shift is going on the backs of owner-occupied properties. We believe that if something isn’t done to make a change, it’s just going to continue to get worse.”

Krogman said more of the burden is shifting from profit-producing farmland to homeowners.

“In 2017, this showed ag land paying 28.12% of total property taxes collected, and owner-occupied was paying 38.126%, so there was about a 10% gap of who was paying between ag and owner-occupied properties,” Krogman said. “Go seven years down the road to 2023, and ag was paying 22.08% of all property taxes collected, and owner-occupied was paying 42.78%.”

While some of that can be attributed to things like ag land being sold for housing developments, he said it’s a gap that could get wider. Ultimately, Krogman said it comes down to how the state values land.

“If commercial and residential owner-occupied are based on market, we know that market while every once in a while, might experience a downturn, that market is going to continue to increase,” Krogman said. “If we’re based on productivity, if I have 100 acres, I’m producing on that 100 acres is going to stay there no matter what the market value is. So, we’re going to continue to see commercial and owner-occupied paying more of what’s being collected.”

Krogman said moving into the next legislative session, lawmakers should listen to the voices of homeowners when considering taxation.