Q&A: State Aid

April 17, 2025
Seal SD Liberty

Q&A: State Aid and the Role of DOGE-SD in the GRT Plan

What is the state aid in the GRT plan, and why is it needed?

The GRT plan eliminates $1.6 billion in property taxes, replacing it with $1.8 billion in Gross Receipts Tax revenue starting in 2027 (April 15, 2025, 20:21). While urban counties like Rapid City can cover their budgets with ~$116.1 million in GRT (April 15, 2025, 20:31), rural counties like Custer and Haakon face shortfalls—~$4.48 million in Custer, ~$1.33 million in Haakon (Q1, April 15, 2025, 20:31). State aid, estimated at ~$66.5M-$142.5M state-wide, bridges these gaps to ensure rural counties can fund schools, roads, and services without burdening urban areas (Q6, April 15, 2025, 20:31).

How is the state aid amount of ~$66.5M-$142.5M calculated?

The ~$66.5M-$142.5M estimate comes from analyzing rural county shortfalls after GRT collection (Q6, April 15, 2025, 20:31):

  • Rural Shortfalls: Counties like Custer (~$4.48M shortfall) and Haakon (~$1.33M shortfall) can’t fully fund their budgets with GRT alone (Q1, April 15, 2025, 20:31).
  • State-Wide Estimate: Across South Dakota’s 66 counties, rural areas (e.g., ~50% of counties) face similar gaps. Aggregating these shortfalls, we estimate ~$66.5M (lower end, assuming efficiency gains) to ~$142.5M (higher end, covering all gaps) is needed annually.
  • Funding Source: South Dakota’s $200 million surplus (2023) provides a buffer to fund this aid, ensuring no cuts to rural services (April 15, 2025, 20:31).

Why is state aid crucial for rural support?

Rural counties often have fewer businesses, generating less GRT revenue. For example, Custer—a tourism hub with attractions like Custer State Park (2 million visitors annually) and proximity to Mount Rushmore—collects ~$3.27 million, with ~$1.69 million from tourism, but needs $10 million, leaving a ~$4.48 million shortfall (Q1, April 15, 2025, 20:31). State aid ensures:

  • School Funding: Rural schools, like Custer’s $5 million budget, stay fully funded, part of the state-wide ~$960 million for education (April 15, 2025, 20:46).
  • Essential Services: Roads, police, and ambulances remain operational, preventing cuts that could hurt rural communities.
  • Fairness: Urban counties like Rapid City (~$116.1M GRT) support rural areas without bearing extra burdens, maintaining equity across South Dakota (April 15, 2025, 21:26).

Does state aid mean the state controls county funds?

No! The GRT plan keeps control local—counties collect and manage their GRT funds directly (April 15, 2025, 20:31). State aid is a support mechanism, not a control grab:

  • Local Autonomy: Counties like Custer decide how to spend their ~$3.27 million GRT, with state aid filling gaps without strings attached (April 16, 2025, 06:31).
  • Transparency: DOGE-SD measures (zero-based budgeting, public audits, citizen oversight) ensure accountability, preventing state overreach (April 15, 2025, 14:00).

How important is DOGE-SD to the effective implementation of the GRT plan?

DOGE-SD (Department of Government Efficiency – South Dakota) is crucial to ensuring the GRT plan works effectively for all South Dakotans, especially in rural counties like Custer, by guaranteeing transparency, efficiency, and local control:

  • Preventing Mismanagement: DOGE-SD’s zero-based budgeting requires counties to justify every dollar annually, avoiding past overspending issues in counties like Custer and Fall River (April 15, 2025, 14:00). In Custer, this saves ~$1.15M-$2.2M, covering 23-49% of its ~$4.48M shortfall (Q1, April 15, 2025, 20:31).
  • Ensuring Transparency: Public audits, posted online by March 31 each year, let you see exactly how your county’s GRT funds—like Custer’s ~$3.27 million—are spent. A seven-member citizen oversight board keeps local leaders accountable, ensuring no misuse of funds (April 15, 2025, 14:00).
  • Supporting Local Control: DOGE-SD empowers counties to manage their budgets without state interference, while state aid (~$1.5M-$2M for Custer) fills gaps. This balance ensures rural counties thrive without sacrificing liberty (April 15, 2025, 21:22).
  • Building Trust: By implementing these measures, DOGE-SD ensures the GRT plan delivers on its promise—$1.6 billion in savings for South Dakotans, with services fully funded and no hidden agendas (April 15, 2025, 21:26).

How does state aid and DOGE-SD align with South Dakota’s values?

South Dakotans value liberty and local control (April 15, 2025, 21:22). State aid and DOGE-SD align by:

  • Empowering Communities: State aid ensures rural counties like Custer can thrive without property taxes, keeping $1.6 billion in your pocket (April 15, 2025, 21:26).
  • Maintaining Equity: It prevents urban-rural divides—Rapid City leads with ~$116.1M GRT, while Custer benefits from ~$1.5M-$2M in aid (April 15, 2025, 20:31).
  • Supporting Liberty: DOGE-SD ensures transparency and local control, protecting your freedom to manage your community’s future without state overreach (April 15, 2025, 14:00).

Join us at the Liberty Forum on April 19, 2025, to learn more about how state aid and DOGE-SD ensure tax freedom for all South Dakotans!