The Family Heritage Alliance is doing weekly legislative updates, based on the issues they’re tracking, and in case you haven’t been following them, Here’s the latest updates, which you can follow on their web site here.
Port Disruptions Causing Challenges for South Dakota Ag Producers and Retailers
By Senator John Thune
A reliable and efficient supply chain is critical to our nation’s global competitiveness. Our ports are a vital link in that chain, but unfortunately, some of the biggest challenges at our ports are self-imposed and are having major repercussions across the country, including South Dakota. The current delays and disruptions caused by labor disputes in the West Coast ports have directly harmed exports, product availability, and jobs in South Dakota. In particular, South Dakota’s farmers, ranchers, retailers, and households are bearing the costs of these labor slowdowns.
On February 10, 2015, the Senate Commerce Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety, and Security held a hearing about the challenges the ports slowdown are causing across the country. As chairman of the Commerce Committee and as a member of the Senate Agriculture Committee, I’ve been monitoring the ports disputes and have heard from a number of South Dakotans about how the disruptions in service continue to directly impact their businesses.
At the hearing, Cargill testified that lost sales and unnecessary port charges are costing our nation’s meat and poultry industry over $40 million per week and jeopardizing relationships with international customers. I have also heard from Tyson Fresh Meats, based in Dakota Dunes, which shared with me that its beef and pork is sitting in freezers near the ports instead of heading to Asian markets, while 30 to 40 large container ships are sitting off the coast waiting to export our nation’s premium products. Tyson Fresh Meats has 41,000 team members, and the U.S. Department of Agriculture reports that agricultural exports support over one million full-time U.S. jobs. These delays, which have been going on since last summer, are having a real impact on jobs and our economy.
The disruption is also hurting consumers and retailers, which often import a substantial portion of merchandise through the West Coast ports. Outdoor Gear Inc., a family-owned winter apparel wholesaler based in Sioux Falls, moves about 95 percent of its inventory through West Coast ports and has been forced to miss deadlines, pay late-delivery penalties, and pass up important sales opportunities, including in December during the peak holiday season. In fact, BNSF railroad testified at the hearing that they have been forced to cut weekly train service to ports in half from 60 trains per week to 30 trains. This dramatic reduction in service underscores the ripple effects that are being felt across the country.
While our nation’s businesses are dynamic and adaptable, this situation cannot go on indefinitely, and we cannot continue to expect our businesses and households to absorb the unnecessary costs of delays. Congestion and labor disputes in our ports are causing a large drain on our nation’s economy and will take months to unwind.
While this has been on-going since late last summer, I urge all sides in the dispute to come together and find a long-term solution as soon as possible. This also requires the president and the administration to get actively involved to resolve this impasse. As chairman of the Commerce Committee, I will continue to highlight the direct impact this slowdown is causing businesses in South Dakota and across the country and I am committed to working with all parties to get this vital link in our nation’s supply chain back on track.
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Providing Regulatory Relief for Community Banks
Senator Mike Rounds
Feb. 13, 2015
Small main-street banks are critical to the success of small businesses in South Dakota. They offer loans to farmers and support our small businesses that provide good jobs and essential services to all corners of our state. Often times, they also serve as community centers where birthdays, anniversaries, town meetings and other gatherings are held and lifelong memories are created. We understand that the longevity and prosperity of community banks are essential.
Recently, financial institutions have been hounded by onerous rules and regulations, especially small community banks. With more than 6,500 community banks throughout the country supporting even the remotest areas, the federal government must make sure it is enabling, not hindering, their ability to function properly. Almost half of small businesses, which we all know are the driver of job creation and economic growth in America, are supported by small community banks. Providing these institutions with regulatory relief is critical.
We recently examined ways we can help community banks during a two-part hearing in the Senate Banking, Housing and Urban Affairs Committee. During the hearings, we specifically focused on the need to roll back some of the regulations in the 2010 Dodd-Frank financial reform law. Dodd-Frank was intended to clean up the mess caused by the housing finance collapse which had nothing to do with community banks. Unfortunately, this has hit small banks with unnecessary regulatory roadblocks.
In the first part of our hearing, we questioned the regulators responsible for implementing these rules for community banks. I challenged officials concerning burdensome paperwork requirements. Currently, financial institutions are required to file periodic financial and other information with their respective regulators. These forms are currently 80 pages long and contain more than 670 pages of instruction material. Complying with this paperwork has been increasingly difficult for smaller banks with inherently fewer resources. I was pleased to hear many of the witnesses agree that reforms are necessary to ease these regulatory burdens.
The second part of the hearing included testimony from community bankers. They offered additional insight on how we can best provide relief from some of the outdated and unnecessary regulations, and how specifically they have hindered their ability to be effective. The bottom line is this: if banks are going to be subject to a more intrusive regulatory environment, those costs will eventually be passed down to the consumer. And if community banks are put at a competitive disadvantage, then consumers – including many South Dakotans – would have less flexibility and fewer choices when it comes to financial decisions. This ultimately bogs down economic activity, beginning at the local level.
Small community banks don’t think of banking in terms of ‘derivatives’ and ‘default swaps’ like they do on Wall Street; they think of banks in terms of how they can best serve their communities – their friends, neighbors, store owners and job providers. I wholeheartedly support efforts to provide them with regulatory relief and separate them from Wall Street banks. I will continue to seek ways to do so as a member of the Senate Banking Committee.
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Legislation and Leadership
By Rep. Kristi Noem
February 13, 2015
It’s that time of year when I have the opportunity to address the South Dakota State Legislature – a body I was once a part of. When I meet with them this Thursday, I’ll be talking a lot about opportunity and the state and federal collaboration that must occur to ensure every hardworking South Dakotan has the chance to get ahead.
Today, South Dakota sits as an example for the nation, due in part to the commonsense policies that come out of the state legislature year after year. We have one of the lowest unemployment rates in the country and consistently earn recognition as the one of the best states to do business. We keep our taxes low and minimize the regulatory burden on family farms and job creators. We put South Dakotans in control of their future and we’ve flourished as a result. I was proud to play a role in facilitating that kind of economy as a member of the South Dakota State House and I’m working hard to bring those same values to the U.S. Congress.
There’s a lot of work that must be done – on both the state and the federal level. Our budgets must get balanced. Infrastructure projects must be funded. Human trafficking has to be stopped. The federal tax code must be simplified. Trade agreements must be signed. And to achieve any of it, common ground must be found. That will require strong leadership.
This week, we celebrate the birthday of one of our nation’s strongest leaders, President George Washington. He reminded us that, “Liberty, when it begins to take root, is a plant of rapid growth.” To produce real results, we need to start with an understanding that neither the state nor the federal government builds an economy or creates jobs. People do. When lawmakers sign a bill, they aren’t signing a paycheck. They’re simply helping to create an environment where if you work hard and play by the rules, you will get ahead. This is the message I’ll be sharing with the state legislature this week.
It’s hard to believe it’s been more than five years since I represented District 6 in the South Dakota House of Representatives. It’s an experience – and a lesson in leadership – that I carry with me to this day.
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Another Effort To Be Even Better Stewards
A column by Gov. Dennis Daugaard:
The word that best sums up the public trust held by all officials is stewardship. Stewardship – the careful and responsible management of something entrusted to one’s care – has been my goal over these past four years.
Good stewardship brought our budget into structural balance four years ago. It has been good stewardship, each year thereafter, to project our revenues and expenses with caution, so if we erred, we would err on the side of a surplus not a deficit. It was an exercise of careful and responsible management when, after receiving an unexpected windfall last year, we used the money to retire bonds early and to pay cash for our new veterans’ home rather than borrowing.
In another effort to improve stewardship of taxpayer dollars, I have initiated a new state debt policy this year.
Our Constitution prohibits debt. To finance construction projects and manage large outflows of funds, the South Dakota Building Authority and South Dakota Health and Educational Facilities Authority were created. These entities issue and refinance bonds to pay for things like state park projects, the buildings at the behavioral health center in Yankton and public university projects. Long-term leases between the state and these authorities retire the bonds that are issued.
Last year, I asked the Bureau of Finance and Management to create a new debt limitation and management policy to guide both the management of existing debt and the issuance of new debt through these authorities. Under this new policy, total debt cannot exceed 1.2 percent of the state’s GDP and total annual debt service payments cannot exceed 4 percent of the ongoing general fund revenue from the previous fiscal year.
We were well below these boundaries at the end of Fiscal Year 2014, with the total outstanding debt as a percentage of state GDP at 0.8 percent and annual debt service payments as a percentage of ongoing general fund revenue at 2.9 percent.
In January, the Lieutenant Governor and Commissioner of Finance and Management traveled to New York City to share this new debt policy with ratings agencies. When Standard & Poor’s revised South Dakota’s outlook from stable to positive last summer, the ratings agency encouraged South Dakota to continue to improve our already strong fiscal position. I appreciate a good credit rating because it saves the state money, but I also appreciate that outside experts are endorsing the strength of the decisions we have made.
The principle of stewardship – careful and responsible management – will continue to be my goal for the next four years. We won’t spend money we don’t have. We will keep our budget in structural balance. We will be frugal, not cheap, and seize opportunities to spend in the short term where it can lead to savings, efficiencies or better government in the long term.
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Jon Ellis is writing this morning about things that most SDWC readers have been hearing about for months; that the 2018 Gubernatorial race is likely between Mickelson, Jackley & Noem.
But my favorite comment comes up when he notes the 2016 race for US Senate. As in, there isn’t likely to be one. Or at least a serious one:
And no, we aren’t talking about the 2016 Senate race, where John Thune is expected to seek a third term. Democrats are in the middle of an epic rebuilding period, and it’s unlikely that they can field a candidate and an operation that would pose a serious threat to Thune with an election now less than two years away.
I got a good laugh out of this one…
Have you seen the #TravelingNoem yet? Follow me on Instagram and see where he goes next: http://t.co/WhHNcgFLMz
— Rep. Kristi Noem (@RepKristiNoem) February 14, 2015
I’m reading on Facebook that State Senator Brock Greenfield is laid up in the Watertown hospital after a particularly nasty fall that left the long-time legislator with a broken arm.
Our thoughts and prayers are with Senator Greenfield.
I was going to ask if was his arm for voting “no,” was injured, as it would have limited him immensely. But with his move to the senate this year, they don’t have all that newfangled technology, and thankfully rely on voice votes.
With Noem Support, House Passes Permanent Increase to Section 179 for Farmers and Small Businesses
Washington, D.C. – Rep. Kristi Noem today joined the U.S. House of Representatives in passing H.R.636, America’s Small Business Tax Relief Act. This legislation, which Noem helped advance through the Ways and Means Committee last week, increases Section 179 expensing limitations for small businesses and farms, among other things.
“As a lifelong farmer and rancher, I understand the importance of reasonable deduction levels for new equipment,” said Rep. Noem. “Increasing the Section 179 expensing limitations for small businesses and farms gives families more flexibility to invest in their operation. And I know the certainty of a permanent increase would be more than welcome too.”
H.R.636 increases deduction amounts under Section 179 of the tax code to $500,000, which maintains 2014 levels. On December 31, 2014, a temporary extension of the $500,000 expensing limitations expired, dropping the maximum amount to $25,000.
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Is an effort to draft someone for State Senate like drafting someone for School Board or Electric Coop Board? It kind of lacks the “oomph” of drafting someone for Governor or US Senate.
Of course, I wouldn’t be writing about it if it wasn’t happening.
Apparently, tired of the relative peace and quiet of this legislative session, in the last week, someone started a “Draft Stace Nelson for District 19 State Senate” facebook page.
The facebook page, located at https://www.facebook.com/draftstacenelson doesn’t list the page’s creator, but noting the people who are supporting it, it would appear to be coming from within the close circle of Nelson campaign people.
The obvious point to bring up is that this effort would pit Nelson against current Republican State Senator Bill Van Gerpen, who anyone would agree is also quite conservative. And certainly wouldn’t be someone that anyone could accuse of “not following” the constitution. Any plea to kick Bill out of office on that basis would seem to be …misplaced at the least.
We’ll continue to monitor the situation to see if this early draft effort is an indicator of Nelson’s intention to re-enter politics after his US Senate effort which ended in a third place defeat at the hands of current US Senator Mike Rounds.
And with that, I’ll ask – what do you think about the possibility of Nelson getting back into the State Legislature? It it a good thing, because he has a lot to contribute to South Dakota? Or would it be a bad thing, remembering robocalls and divisiveness?