Re-allocation of the Cement Trust Fund

Katie Hill

Katie HillReporter

Amendment L of the South Dakota Constitution will be included in the ballot for the 2010 midterm election on Nov. 2.

The amendment is proposing a change to Article XIII of the constitution regarding the allocation of the state Cement Enterprise Sales Trust Fund.

The state cement plant was sold about 10 years ago. A trust fund to benefit South Dakota citizens was created from the sale of the plant.

Secretary of State Chris Nelson said an agreement was set to allocate $12 million every year from the trust fund to the State general fund.

“The downturn of the stock market has decreased the value of the trust fund by about $103 million, and the proponents wanted to do something about it,”

Nelson said.

He said the required transfer of $12 million every year will ultimately deplete the trust fund.

In past years, the funds have helped balance the state budget, and improve programs like K-12 education, Medicaid, law enforcement, and other aspects of the general fund.

“A lot of people ask “What is the right way to vote?’ and it really depends what the markets are going to do,” Nelson said.

If the amendment were to pass, the amount allocated to the general fund will decrease to $8 million over the next four fiscal years.

“The amendment would leave it up to the legislature to decide the amount transferred by up to four percent of the fund value,” Nelson said.

“Opposition to the amendment “wants to keep transferring $12 million to the general fund because it was the original agreement,” Nelson said. “Opponents think the mandated agreement is important and necessary to keep the principle of the fund.”

A “yes” vote would preserve the fund and change the annual distribution from the cement plant trust fund. Voting “no” is a vote against the constitutional amendment and will not change Article XIII.