Why Empire Mall Closures Impact All South Dakotans

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With Sears closing at The Empire Mall, the shopping destination will soon lose three of its biggest retailers. The list also includes Younkers and Toys”R”Us.

Even if you don’t shop in stores anymore, you should still care because of sales tax revenue.

“Just doing a little shopping and walking around,” Kate Kurtenbach said.

This is a rare occasion for Kate Kurtenbach and Justin Bright. The couple, along with their five-month-old son, are eating and shopping in downtown Sioux Falls.

“Most of the time we shop Amazon,” Bright said.

“I never ever mall shop,” Kurtenbach said.

Across the nation, more people are headed online to shop. Sioux Falls Finance Director Tracy Turbak has noticed the change when it comes to sales tax revenue.

“In the last couple of years, in 2016 and 2017 in particular, growth was very sluggish,” Turbak said.

Exactly how important is sales tax to a city? In Sioux Falls it makes up 40 percent of the general fund.

“In simple terms sales tax revenue are the city’s bread and butter,” Turbak said.

The money pays for everything from fire and police to parks and streets.

“When that growth is down, that really limits the city’s ability to keep up with that need. When we’re growing at the rate we are in terms of population, that really puts a squeeze on the city,” Turbak said.

A squeeze that shoppers like Kurtenbach and Bright are helping with when they walk instead of click.

“For us it is really fun to come out and go to stores,” Kurtenbach said.

The Supreme Court is expected to deliver a ruling in South Dakota v. Wayfair this month. 

If the court rules in favor of the state, online retailers would be required to pay sales tax.

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