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SHANTEL KREBS

1998 Referred Law 2

1998 Ballot Question Pamphlet
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.

Referred Law 2

Title: An act to transfer the unclaimed property office from the State Treasurer's Office to the Secretary of Revenue.

Attorney General Explanation

Under current law, the State Treasurer administers the unclaimed property laws. The 1997 Legislature transferred this responsibility to the Secretary of Revenue.

A vote "Yes" will transfer the unclaimed property office to the Secretary of Revenue.

A vote "No" will leave the unclaimed property office with the State Treasurer.

Pro -- Referred Law 2

Savings to taxpayers and increasing the amount of unclaimed property to be found and returned to South Dakotans are the reasons this proposal should become Law.

Testimony presented before the Legislature by the Department of Revenue estimates initial savings of $100,000 per year in administrative costs. This can be achieved by the economies of scale that the Department of Revenue can provide, i.e., by allowing 42 existing revenue auditors plus support staff to include the search for unclaimed property within their regular audit activities. Since the Department of Revenue already has contact with businesses responsible for the collection of sales taxes, or the payment of other taxes to the State, it can very effectively absorb the search for unclaimed property with minimal expense.

Since 42 auditors would make more contact with the business community, additional unclaimed property could be discovered...making the cost of recovery even more efficient than is currently possible.

Finally, the Department of Revenue can use the same strong relationships it must maintain with other states for effective tax administration to promote strong cooperative efforts in interstate search for unclaimed property and the rightful owners of that property.

More efficiency, effective use of existing manpower, and strong interstate cooperation make this proposal a very good idea worthy of becoming Law.

Submitted by: Sen. Mike Rounds, 806 Cherry Dr., Pierre, SD 57501. Senator Rounds represents legislative district 24.

Con -- Referred Law 2

Four years ago South Dakotans elected Dick Butler as their new State Treasurer after he campaigned on a promise to clean up the office and improve collections and management of unclaimed property such as abandoned bank accounts, insurance policies, and securities.

State Treasurer Butler kept his promise--collecting record-breaking millions from banks and corporations and faithfully returning these monies to rightful owners. Treasurer Butler controlled costs while depositing record amounts to the general fund after expenses and paid claims. He brought to the office a new responsive attitude of processing claims with a desire to pay rather than deny. Preferential treatment for certain powerful banks was stopped in its tracks.

In response, the legislature and Governor retaliated with legislation to take the Unclaimed Property Division away from State Treasurer Butler and move it to the revenue department, the tax-collecting agency under the governor’s office.

South Dakota citizens reacted by collecting 22,000 signatures referring this bad law to a vote--a law the Sioux Falls Argus Leader labeled a "power grab, pure and simple."

In defense, the bill’s sponsors suggested it might save money. However, comparisons show Treasurer Butler’s office is already among the most efficient in the nation. A majority of states entrust unclaimed property to their State Treasurer. Few place it in the hands of tax collectors as the Governor and legislature seek to do because unclaimed property is private property, not tax revenues.

We believe it perilous to put these duties under the governor’s office. The time will come when our governor is cozy with a big city bank or even a small country bank and helps them avoid collections. Under the current system and as the 1994 election for State Treasurer demonstrated, the elected State Treasurer remains accountable to the people--not to powerful financial institutions.

To keep authority with your elected State Treasurer--Vote No on Referred Law 2.

Submitted by: Sen. Bernie Hunhoff (District 18), PO Box 175, Yankton, SD 57078; Sen. Rebecca Dunn (District 15), 320 N Summit Ave., Sioux Falls, SD 57104; Rep. Pat Haley (District 21), 766 Utah Avenue SE, Huron, SD 57350; Rep. Larry Lucas (District 27) PO Box 182, Mission, SD 57555. These legislators were the sponsors of the referendum petition on this law.