SD governor approves state budget, other bills

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PIERRE (AP) — South Dakota Gov. Dennis Daugaard on Wednesday approved the $4.1 billion state budget passed by the Legislature but vetoed a minor provision that directs how some money would be divided among the state's four technical schools.

Daugaard also signed into law measures that establish a new program to lure businesses to South Dakota, ban the use of cellphones by beginning drivers and set up a commission to regulate boxing, kickboxing and mixed martial arts.

The measures were among two dozen the Republican governor signed Wednesday. He is still considering 19 other bills passed by lawmakers during the main run of this year's legislative session, which ended March 8.

Daugaard issued a line-item veto for a part of the budget that directs how $500,000 in one-time money would be distributed to technical institutes. He said he supports giving the schools the money but distribution based on enrollment in the 2011-2012 school year was improper. By striking that language, the money can be distributed according to more recent enrollment figures, he said.

The Legislature is unlikely to override the governor's veto. The South Dakota Constitution provides that when a governor issues such a line-item veto, the rest of a bill is considered to be signed into law.

Lawmakers had made few changes in the governor's recommended budget for the year beginning July 1. The spending plan provides roughly 3 percent increases to ongoing spending on K-12 schools, universities, state workers' paychecks and the facilities that provide medical care to those enrolled in Medicaid.

For almost three months before Daugaard signed the bill, South Dakota had no incentive plan to attract large businesses in place because a previous program expired Dec. 31 and voters in November rejected a replacement program proposed by Daugaard.

The new program, written by legislative leaders from both parties, will refund all or part of the 4 percent state sales tax paid by some construction projects costing more than $20 million. A project would not get the tax break unless a state panel decided the company would only locate in South Dakota with such an incentive.

The 2 percent contractor's excise tax paid by those projects and a portion of the unclaimed property the state receives from abandoned bank accounts will be used to set up a fund to help communities build infrastructure needed to encourage development, boost workforce training and help K-12 schools bear the cost of English language training when a project draws workers from other cultures.

The measure takes effect immediately, using $7 million from the state treasury to get programs running before the long-term funding is available.

Sen. Corey Brown, R-Gettysburg, said South Dakota has been at a disadvantage because it had no major incentives to compete with those from neighboring states. He said he's pleased lawmakers could agree on a plan after arguing over incentives for years.

"I think this is kind of a major step forward," said Brown, who led the effort to write the plan.

Another law signed by the governor will ban the use of cellphones by beginning drivers. Effective July 1, young drivers will be prohibited from using cellphones or other electronic devices until they get unrestricted licenses at age 16.

A law officer will not be allowed to stop a beginning driver just for using a cellphone while driving, but could issue a ticket after pulling over a young driver for another violation.

South Dakota joins 33 other states and the District of Columbia in banning cellphone use by novice drivers. The measure was suggested by a task force set up by the Legislature to find ways to reduce teen traffic crashes and the resulting injuries and deaths.

Sen. Craig Tieszen, R-Rapid City, head of the task force, said the cellphone ban is a good first step in reducing teen traffic accidents.

"I think it will send the right message and at some point maybe we can consider other measures that would improve teen driving in South Dakota," Tieszen said.

Daugaard initially opposed the measure setting up a commission to regulate boxing, kickboxing and mixed martial arts because he said mixed martial arts fights are too violent to be called sport.

When the governor signed the bill Wednesday, he issued a letter to lawmakers explaining that he decided that regulating fights for safety was better than them occurring without regulation.

"I believe mixed martial arts (MMA) competitions are gratuitously violent, and I regret that MMA activities occur in our state," he wrote.

The measure's main sponsor, Sen. Mark Johnston, R-Sioux Falls, said South Dakota is one of the last states to regulate such fights. Fights already occur in South Dakota, but regulation will protect the safety of fighters and encourage promoters to stage events in the state, he said.

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