Compiled by the Office of Secretary of State Joyce Hazeltine
SDCL 12-13-23 requires the Office of the
Secretary of State to prepare and distribute public information
concerning constitutional amendments, initiatives and referred
measures. This pamphlet is prepared by soliciting statements from
the proponents and opponents of amendments and measures.
The title, explanation and effect of a vote for each ballot question
were provided by the Attorney General. No other statements on this
pamphlet reflect the opinion of the State or the Attorney General.
The information was compiled by the Secretary of State as supplied
by the writers, was not verified by the Secretary of State and does
not reflect the position of the State regarding the legality or
effect of the amendments or measures. The Secretary of State does
not guarantee the accuracy of any claims made by the proponent or
opponent writers in this brochure.
Constitutional Amendment G
Title: An Amendment to Article VIII
of the South Dakota Constitution, permitting the investment of
permanent school funds in certain stocks, bonds, mutual funds, and
other financial instruments.
Attorney General Explanation
The S.D. Investment Council manages and invests
the state permanent school fund, and other educational or charitable
funds. The Investment Council may not buy stocks, mutual funds or
similar investments with this money. Additionally, if any of these
funds lose money, the Legislature must reimburse all losses.
Amendment G would allow the Investment Council to
purchase stocks and similar investments. If these investments lose
money, the Legislature would only be required to reimburse if the
loss was caused by imprudence or other unconstitutional acts.
A vote "Yes" will allow these state funds to be
invested in stocks and similar investments, and limit the
A vote "No" will leave the Constitution as it is.
Pro -Constitutional Amendment G
In 1998 South Dakota legislature
passed a joint resolution placing Amendment G on the ballot. If
approved, the $130 million permanent school and other education
funds would be allowed to invest in "stocks, bonds, mutual funds,
and other financial instruments as provided by law" by the South
Dakota Investment Council. Any loss occurring through an
unconstitutional act shall be made good through a special
appropriation. The Amendment would allow more investment flexibility
to maintain the fund against inflation and to generate higher future
The members of the South Dakota Investment Council are professionals
responsible for investing over $4.8 billion of state funds. The
Commissioner of School and Public Lands is a member of the council.
The Council has an exceptional investment record over the past 25
Amendment G would maintain the purchasing power of the school funds
for future generations of school children. This would be done with
professional management and more diversification of the funds. A yes
vote would allow the school funds to be invested similar to the
state retirement systems.
Amendment G means preservation for the future of our schools. Vote
Submitted by: Curt Johnson, PO Box 852, Ft. Pierre, SD 57532. Mr.
Johnson is the Commissioner of School and Public Lands.
Con - Constitutional Amendment G
Our founding fathers were concerned about funding the education of
our children when they established the permanent education fund.
This was a solid, low-risk investment of revenues from land and
other sources to help fund education into the future.
This proposed amendment asks us to allow the state to invest these
funds in higher-risk stocks, bonds, etc. instead of the current
conservative, low-risk investments? Before you decide, consider the
following five points:
(1). We had a similar issue in
1994 and again in 1996. How many times do we have to say, "NO"?
(2). The state investment council
has enjoyed great success in investing other state dollars.
However, higher risk investments potentially earn more
dollars, but they also potentially lose more dollars. Our
founding fathers intended this fund to be a conservative fund,
lasting through the ages.
(3). We are constantly told that
our teachers are the lowest paid in the country. If we hit a
down market, what risk does that place on our teachers?
(4). What happens if there is a
loss? This amendment makes the state liable for all "losses that
may occur through any unconstitutional act..." What is
unconstitutional? It usually takes a judge to decide. However,
win or lose, we, the people, make up the state. Thus, we, the
people, would pay for their risky investment with higher taxes.
This was not the intent of the permanent school fund.
(5). Finally, this is a
constitutional amendment. History shows that markets go up and
down. What happens if the market crashes like it did in the
30’s? Our constitution is not only for today.
Submitted by: Sen. Bob Drake, PO Box
92, Bowdle, SD 57428. Senator Drake represents legislative district