PIERRE, S.D. (KELO) — Governor 1, House 0.
That’s the score after the only veto issued by Governor Kristi Noem in the 2023 session was upheld Tuesday.
The state House of Representatives tried but couldn’t override her block on HB1109 which sought to double the optional $2 maximum tax that municipalities can levy on lodging rooms.
A two-thirds majority of 47 was needed. The effort led by Republican Rep. Becky Drury fell short 41-29. She said communities typically use the revenue to promote events.
“In my neck of the woods,” said Drury, the bill’s prime sponsor, “they support the LNI Invitational, Black Hills Powwow, Black Hills Stock Show, and the list goes on.”
But Republican Rep. Phil Jensen said there’s nothing that stops businesses from voluntarily charging extra and using it for promotion.
“These hotels, these entities, are in business for themselves. There’s nothing – nothing – stopping them from raising the rate of their hotels and if they want to donate to a fund that would help their advertising, they can do so and they can write off as a tax expense,” he said.
Republican Rep. Tamara St. John said tourism is important to her region. “Our tourism partners are everything, and when they come to me and ask me to support this and they want something, those in Watertown, Aberdeen and northeast South Dakota, it’s my duty to support them,” she said.
Republican Rep. Mary Fitzgerald saw it differently. “No matter how you slice this, no matter what kind of a pretty box you put it in, with a pretty bow, it is still a tax – a tax, a tax, a tax,” she said.
Fitzgerald had voted for it the first time through the House. Others who switched from yes to no were Republicans Julie Auch, Kirk Chaffee, Fred Deutsch, Scott Odenbach and Sue Peterson, while Democrat Kameron Nelson changed to a yes.
The bill hadn’t reached the two-thirds threshold in either chamber when it originally passed. Those votes were 45-23 in the House and 19-16 in the Senate.
In her veto message the governor wrote, “We should be working to cut taxes this legislative session, not increase them.”