South Dakota governor eases stance on tax rises

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PIERRE, S.D. (AP) - South Dakota Gov. Dennis Daugaard, who in the past has taken a firm stand against tax increases, said this week he would not rule out that option when considering future transportation funding.

This summer the Legislature will study financing for the state’s roads and bridges. The study will likely result in legislation next January.

“I want to participate in the discussion without taking any options off the table, including proposals to restore the purchasing power of the gas tax,” said Daugaard in a column released by his office Wednesday. The Republican is running for re-election this year.

Daugaard’s sole veto of the 2014 session was of an optional hotel occupancy tax increase. He said he didn’t want to give local governments tools to raise taxes. State Senators did not provide the two-thirds vote needed to override this veto.

His spokesman Tony Venhuizen said the decision to be open to gas tax increases is not about politics, but about finding the right policy for the state. Because the gas tax is per gallon, not per dollar, it hasn’t adjusted for inflation since it was set 15 years ago.

“I still hope we can find another way,” said state Rep. Mike Verchio of raising the gas tax. The Hills City Republican is on the summer study committee. He said some kind of tax increase might be necessary. An increase to the tourism tax would be less offensive, because it would be paid by out-of-staters, Verchio said.

The committee will consider short- and long-term funding options for state projects, because the federal transportation fund is expected to go into the red this year.

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