Tuesday, October 14, 2008

When Set Revenue Meets Increasing Costs…

With the closing of the school funding lawsuit, and the commencement of committee meetings to study highway and transportation issues, we are left wondering about the future of education and transportation infrastructure in South Dakota.

In the Argus Leader on October 1st, Sanborn Central Superintendent, Lori Whitney, testified that in a few years, after the school has expended its savings trying to stay afloat, the school will be broke. Then it will no longer be a question of hiring teachers and buying laptops, it becomes a question of keeping the facility and the education system alive in the community.

Bob Mercer, in the Pierre Capital Journal, notes that highways in South Dakota face some serious challenges in the future. In his article on September 29th, he explains the highway funding system in South Dakota, and also why the State Highway Department will need an additional $128 million in operating funds to keep up annually. Is such an increase a possibility for South Dakota?

Many factors play into these issues, but I can see none more obvious than a set revenue stream colliding with operating cost increase (as illustrated by my rudimentary illustration above). In recent years, the energy costs for bussing students, heating and cooling facilities, lighting, road construction, fuel for machinery, etc. have shot through the roof across the United States. We have been able to shoulder the majority of this increase due to savings, subsidies, and tax credits. How long until those programs are no longer sufficient? As a result of these diverging streams, South Dakotans left in the middle are stretched and strained.

We need to actively work together to alleviate that stress. I believe we will need: a diverse and sustainable energy portfolio in South Dakota, an altering of our tax structure to keep the burden low but allow for increased revenue to be put to work by local governments, and an economic development plan specific for all regions of our state.

It will take some hard work and dedication, but those are not new concepts to South Dakotans.

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