Examples of Financial Benefits

April 16, 2025
Seal SD Liberty

Examples of Financial Benefits for Rapid City Residents

The GRT plan eliminates property taxes, saving Rapid City $38.7M-$48.4M annually ($3,000-$5,000 per household, ~$10,000-$50,000 per business, depending on property value). These savings free up cash for homeowners and business owners to pay off debts faster, invest, or spend locally, boosting the economy. Below are four examples tailored to Rapid City residents, showing how they can use these savings to accelerate mortgage or debt repayment.

1. Homeowner: Paying Off a Mortgage Faster

  • Profile: Jill, a 40-year-old Rapid City teacher, owns a 3-bedroom home valued at ~$350,000 (average for Rapid City, based on 2023 Zillow data).
  • Property Tax Burden: At ~1% effective rate (South Dakota average, April 15, 2025, 20:31), Jill pays ~$3,500/year in property taxes.
  • GRT Plan Benefit: Starting 2027, Jill saves $3,500 annually.
  • Financial Impact:
    • Mortgage Acceleration: Jill has a 30-year, $280,000 mortgage (80% of $350,000) at 6% interest, started in 2020, with $1,800/month payments. By applying $3,500/year ($292/month) to principal, she cuts her mortgage term by ~7 years (from 2050 to 2043), saving ~$70,000 in interest (based on amortization calculations).
    • Alternative: If Jill keeps regular payments, she banks $3,500/year, building ~$17,500 in savings by 2032 for emergencies or retirement.
  • Why It Matters: Jill pays off her home faster, gaining financial freedom to travel or save for her kids’ college, without losing city services like schools or police (~$84M and $22.4M funded, April 15, 2025, 20:31).

2. Homeowner: Clearing Credit Card Debt

  • Profile: Mike, a 55-year-old Rapid City mechanic, owns a $250,000 condo (below median home value).
  • Property Tax Burden: Mike pays ~$2,500/year in property taxes (~1% rate).
  • GRT Plan Benefit: The GRT plan saves Mike $2,500/year from 2027.
  • Financial Impact:
    • Debt Payoff: Mike has $15,000 in credit card debt at 18% interest, with minimum payments (~$450/month) stretching to 2035, costing $12,000 in interest. By redirecting $2,500/year ($208/month) to the card, he pays it off in ~5 years (by 2032), saving ~$9,000 in interest (using debt payoff calculators).
    • Next Steps: After clearing debt, Mike uses $2,500/year to boost his 401(k), adding ~$12,500 by 2035 (assuming 5% return), securing retirement.
  • Why It Matters: Mike wipes out high-interest debt, reducing stress and building wealth, while Rapid City’s roads ($11.2M) and parks ($5.6M) stay funded, per Q1 (April 15, 2025, 20:31).

3. Business Owner: Paying Off a Commercial Loan

  • Profile: Lisa, 45, runs a Rapid City coffee shop in a $500,000 commercial property (typical for small retail, based on 2023 commercial real estate trends).
  • Property Tax Burden: At ~1% rate, Lisa pays ~$5,000/year in property taxes.
  • GRT Plan Benefit: Eliminating property taxes saves Lisa $5,000/year starting 2027.
  • Financial Impact:
    • Loan Acceleration: Lisa has a $400,000 commercial loan (80% of $500,000) at 7% interest, started 2022, with $3,300/month payments due until 2042. Adding $5,000/year ($417/month) to principal shortens the loan by ~4 years (to 2038), saving ~$50,000 in interest (amortization estimate).
    • Business Growth: Post-loan, Lisa invests $5,000/year in equipment or staff, increasing revenue 10% ($10,000/year, based on small business ROI), adding ~$250 GRT (2.5%), helping city funds.
  • Why It Matters: Lisa clears her loan faster, grows her shop, and supports Rapid City’s $116.1M GRT revenue, ensuring police ($22.4M) and operations ($8.4M), per Q1.

4. Business Owner: Tackling Equipment Debt

  • Profile: Tom, 50, owns a Rapid City auto repair shop in a $300,000 property (smaller commercial space).
  • Property Tax Burden: Tom pays ~$3,000/year in property taxes (~1%).
  • GRT Plan Benefit: The GRT plan saves Tom $3,000/year from 2027.
  • Financial Impact:
    • Debt Payoff: Tom owes $20,000 on equipment loans at 10% interest, with ~$600/month payments due until 2030, costing $5,000 in interest. Using $3,000/year ($250/month) pays it off by mid-2028, saving ~$3,500 in interest (debt calculator).
    • Expansion: After debt, Tom spends $3,000/year on marketing, adding ~$6,000/year in sales (20% ROI, industry estimate), contributing ~$150 GRT, boosting city revenue.
  • Why It Matters: Tom frees his business from debt, expands, and supports Rapid City’s $194.5M budget, keeping parks ($5.6M) and schools ($84M) strong, per Q1.