Agricultural Tax Exemption


For Immediate Release: Wednesday, December 31, 2014
CONTACT: Jerry Derr at 605-720-1625

Agricultural Tax Exemption 

Sturgis, SD - Meade County Commissioners Galen Niederwerder and Alan Aker announced today that they have placed an agricultural tax exemption on the next county commission meeting agenda. 

The tax exemption is the 5 years of zero property tax on newly-constructed business property that is already available county-wide on any new commercial, industrial or multi-family housing structure valued over $30,000 and $10,000 for ag structures. The tax break is called the "discretionary formula" and can be adopted only by counties, but applies to all property in a county, whether it's in city limits or not. The discretionary formula tax break is not available on any new single-family homes. The discretionary formula tax exemption covers all property taxes: county, school, and special districts.  

Currently, the discretionary formula is not available within the newly-formed TIF district (TIFD) the county will use to pay for the new road planned east of Sturgis. The change proposed by Niederwerder and Aker will make ag structures within the TIFD eligible for the discretionary formula, while other commercial structures within the TIFD will remain ineligible. "We're doing this to make sure ag producers within the TIFD have exactly the same taxes and tax breaks available to them as ag producers outside the TIFD," Niederwerder explained.  

"We want new construction at rally venues or other new non-ag businesses benefitting from the road to help pay off the TIFD, but not ag producers," Aker said. "We think the road will function as a less-costly farm-to-market road for a lot of ag producers north of the road, and that's an important benefit to them, but we wanted them to have the tax break anyway, because new ag structures would probably be built with or without the road."  

Meade County's zero-percent-for-five-years tax policy on new construction is the most generous tax break state statute allows. Aker said that as far as he knows, only Fall River County has joined Meade County in offering the full 100% tax break for the full five years as allowed by statute. Additionally, Aker said he believes Meade County offers the tax break to the most kinds of new construction. "I don't think all the counties offer it on ag or multi-family structures, but Meade County wanted everyone who invests in our county to have this tax break." According to Niederwerder, "We welcome all new investment, equally. All of it helps grow our tax base and keep existing landowners' taxes lower." 

Niederwerder said he wanted to remind all Meade County landowners of their opportunity to take advantage of this tax break. "If you can build your shop or grain storage valued over $10,000 in Meade County versus a neighboring county, you'll get a better discretionary formula tax break if you build it here," Niederwerder said.