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Madison commission adopts resolution to inform public about Initiative 28 after staff estimates $622,000 hit to general fund
Summary
The Madison City Commission unanimously approved Resolution 2024-25 to inform residents about Initiated Measure 28, which staff said would remove sales tax on many food items and could reduce the city’s general fund by about $622,000; commissioners directed conservative budgeting and explored legal limits on civic education.
The Madison City Commission unanimously approved Resolution 2024-25 on Aug. [date not specified], directing staff to inform the public about Initiated Measure 28, a statewide ballot proposal that staff said would remove sales taxes on many items sold for human consumption except alcohol.
City staff member Jamieson told the commission that preliminary modeling shows the city could face an estimated $622,000 reduction to the general fund if the measure takes effect as currently drafted. Jamieson said the measure’s ultimate effect on local taxing authority would be subject to court interpretation: “There is a question of whether it will affect our local sales tax … Many of us believe that it will, but that’s something that the courts would have to decide,” he said.
The resolution is intended primarily as an educational measure to make residents aware of the ballot item and its potential local consequences. Commissioners discussed the legal line between using public funds to educate voters and using funds to advocate for or against a measure; Jamieson noted the city may spend for education but not for advocacy. The commission discussed options including printed flyers, public forums and coordination with regional groups such as the South Dakota Municipal League and retail associations.
Several commissioners urged conservative budget planning in light of the estimate. One commissioner asked whether staff could prepare alternate budgets that assume the measure passes; staff replied they had not yet prepared dual budgets but could incorporate the projected loss into 2025 projections. Jamieson also noted that, if the measure were enacted and effective July 1, the timing would mean only half of the annual impact would appear in the next fiscal year.
The motion to adopt the resolution passed by voice vote. The commission instructed staff to pursue permissible public-education steps and to present budget options and further analysis as they become available.
