An Act to establish a fund to assist counties with paying infrastructure expenditures.

Be it enacted by the Legislature of the State of South Dakota:

Section 1. That § 10-1-44 be AMENDED:

10-1-44. There shall beis established within the state treasury the sales and use tax collection fund for the purpose of administering the sales, use, municipal non-ad valorem, and contractors' excise taxes. Charges for the administration and collection of taxes collected pursuant to chapter 10-52 shall be deposited into the sales and use tax collection fund. In addition, subject to section 2 of this Act, the secretary of the Department of Revenue shall, on a monthly basis, deposit revenue collected as a result of taxes imposed in chapters 10-45, 10-46, and 10-58 in the sales and use tax collection fund. The total amount deposited in the sales and use tax collection fund may not exceed the amount budgeted for such purposes. All money in the fund created by this section shall be budgeted and expended in accordance with the provisions of Title 4 on warrants drawn by the state auditor on vouchers approved by the secretary of the Department of Revenue.

At the end of each fiscal year any cash balance left in the sales and use tax collection fund shall be transferred to the general fund.

Section 2. That chapter 10-1 be amended with a NEW SECTION:

Terms used in this Act mean:

(1) "County population," the population of the county based on the most recent estimate available from the U.S. Census Bureau;

(2) "Population adjustment factor," if the county population is:

(a) Greater than one hundred and fifty thousand, it equals 0.65;

(b) Less than one hundred and fifty thousand and greater than or equal to one hundred thousand, it equals 0.70;

(c) Less than one hundred thousand and greater than or equal to fifty thousand, it equals 0.80;

(d) Less than fifty thousand and greater than twenty-five thousand, it equals 0.90; and

(e) Less than twenty-five thousand, it equals 1.0;

(3) "Adjusted total population," the total population of all counties after applying the population adjustment factor;

(4) "Surface type adjustment factor," equals 0.50 for gravel, 0.15 for asphalt, 0.15 for graded, 0.10 for concrete, 0.05 for unimproved, and 0.05 for primitive;

(5) "County road miles by surface type," the total number of miles corresponding to gravel, asphalt, graded, concrete, unimproved, and primitive roads within a county as identified by the Department of Transportation;

(6) "Deck area," equals the total square feet of any bridge, within a county as identified by the Department of Transportation;

(7) "Adjusted total county road miles," the sum of all county road miles in all counties in the state after applying the surface type adjustment factor to each type of road surface.

(8) "County revenue allotment," five and five-tenths percent of the monthly revenue received as a result of taxes imposed in chapters 10-45 and 10-46.

Section 3. That chapter 10-1 be amended with a NEW SECTION:

There is established in the state treasury a special county capital improvement fund for each county in the state. On a monthly basis, the Department of Revenue shall distribute the county revenue allotment among all the special county capital improvement funds proportionally, based on the calculated percent for each county, which is equal to the sum of:

(1) The value of the county population multiplied by the population adjustment factor divided by the adjusted total population multiplied by thirty-three and one-third percent;

(2) The value of county road miles by surface type multiplied by the corresponding surface type adjustment factor divided by the adjusted total county road miles multiplied by thirty-three and one-third percent; and

(3) The value of the deck area of the county divided by the total combined deck area of all counties multiplied by thirty-three and one-third percent.

The Department of Revenue shall deposit the moneys in the fund to the county entitled thereto within thirty days of receipt after accounting for any refunds made. The county, through its board of county commissioners, may use the moneys from the fund for the purpose of repairing or improving roads, or acquiring, constructing, renovating, or replacing a building or structure described in §§ 7-25-1 and 7-25-3, law enforcement, the operation of jails, or a facility designed to reduce jail incarceration.

The secretary of the Department of Revenue shall keep full and accurate records of the revenue credited and distributed pursuant to this section.

Section 4. This Act is effective on July 1, 2023.