PIERRE, S.D. (KELO) — The South Dakota Department of Revenue is trying to provide property owners an opportunity to better understand how buildings and lands are assessed for taxes and what the tax levies are.

State Revenue Secretary Michael Houdyshell went before the Legislature’s Ag Land Assessment Task Force on Tuesday to talk about the modernization project.

Lawmakers formed the task force in 2008 as an initial step in converting South Dakota’s assessment of agriculture property from a market-based system to a production-based system.

Then-Secretary Jim Terwilliger signed a $903,023 contract on January 4, 2021, with a software firm named Axiomatic. The governor chose Terwilliger to be her state finance commissioner effective April 1, 2022, and promoted Houdyshell from department legal counsel to her administration’s revenue secretary.

“We’re really excited about it,” Houdyshell said Tuesday. He explained that 66 county governments submit 14 different reports and they are spread across 16 different formats. The modernization effort under way will smooth the processing and fits Kristi Noem’s transparency pillar from her 2018 campaign for governor.

“This has been a very good experience working with this vendor,” Houdyshell said. “They come from the property tax world. They understand our language.”

The department recently launched the first phase of a public transparency portal. The goal is to generate the history of assessments and taxes for each property statewide. Counties began to submit forms electronically in April of this year; all 66 counties had submitted as of Monday, according to Houdyshell.

The next phase will allow a citizen to see what will happen in the year ahead. A ranking system is part of what’s now available for taxes on the big three types of local governments: county, municipal and K-12 schools.

“I have to admit I was a little skeptical we’d get this far this quick, but we did,” Houdyshell said, calling it “a big deal.” He said he hopes the system gains value as more information is added.

Wendy Semmler, director for the department’s property-tax division, said about 1,800 local government bodies assess a property-tax levy.

”We’re probably about 10 years late doing something like this, but it’s never too late to improve,” Houdyshell said. 

The department is now focusing on HB 1325, regarding Class IV soils, and adjustments. The task force chair, Representative Kirk Chaffee, R-Summerset, was prime sponsor.

Houdyshell said the department sent a letter in May about the legislation to all county directors of equalization letting them know the department is serious. He said the common-sense adjustments are necessary for the productivity-based system to work well. Each county must determine what to do with Class IV soils and nine counties so far plan to re-classify soils from crop-rated to non-crop, according to Houdyshell.

The department is also increasing efforts to train directors of equalization and hired a new education specialist focused on training and education for all county officials who deal with property taxes, Houdyshell said The division now has four former county equalization directors on staff. “I think that’s been a huge boon for the division,” he said.