May 24, 2010

Paying for the quality of life

Our neighbor Lorraine Collins always has an interesting perspective on a wide range of topics. Here's another that should catch your interest -- and perhaps spur a comment or two. Her commentaries appear regularly in the Black Hills Pioneer, and she graciously allows us to share them with on-line readers here.


The other day I met a young woman who had just moved to the Black Hills from the Sioux Falls area. She said she'd been surprised that that wages were so low out here since the cost of living was so high, compared to where she'd lived before. I don't have much hard information about the cost of living, but I hear complaints about how much higher groceries and gasoline are here than in East River.

I also came across a recent report by U.S. News that ranked various South Dakota cities in terms of best places to retire. Eight of the nine cities were in East River, with Rapid City the lone representative of West River. The cost of living in all East River cities was described as low whereas Rapid City was ranked average. Income was ranked low in all towns except Pierre and Sioux Falls where it was average. Housing prices were high everywhere. So the young woman's opinion seems to have some credibility--higher cost of living, lower wages out here.

About a year and a half ago when I was writing a column about South Dakota's economic situation, I found some statistics that showed that people in East River earned quite a bit more than those of us here in the west. The mean salary in Sioux Falls was $2600 higher than in Rapid City and $5400 higher than that of people in "non-metropolitan" western South Dakota, which is where most of us live out here.

This may help explain why some folks out here tend to be skeptical that politicians from Sioux Falls can understand us, and why candidates for governor or Congress from metropolitan East River towns sometimes have a hard time connecting with us. I think it says something interesting about our state that this spring's candidates for governor include three lawyers with Sioux Falls connections, the former mayor of Brookings and two West River ranchers.

I was thinking about all this economic stuff recently because of two stories in the media. One said that South Dakota workers are paid less than workers in any other state, and the other reported that the governor spoke to outstanding high school seniors and encouraged them to find jobs in South Dakota. Since they'd just learned they could earn more money by leaving the state, the governor tried to put a better spin on that news.

He said they shouldn't believe the "hype" that South Dakota is a low-wage state and that we rank 10th in the nation when disposable income after taxes is adjusted for the local cost of living. I looked for that peculiar statistic at various online sites but I couldn't find it. If South Dakota ranks last in the nation for wages, is it also true that the cost of living here is cheaper than anywhere else in the country? Or if it isn't, are our taxes so low compared to other states that we have higher percentage of our money left after paying taxes? If so, is a higher percentage of less income better than a lower percentage of a higher income? The statistic seems meaningless to me.

I came across an interesting chart in a Retirement Housing Guide on line. It ranked state property taxes in 2007 and included such things as taxes as a percentage of home value as well as taxes as a percentage of income. In terms of taxes as a percentage of home value, South Dakota ranked 13th. If I understand this, it means that our homes were taxed more heavily than those in 37 other states. In terms of "taxes as a percentage of income" we ranked 23rd.

The governor said, "The quality of life is here." Many of us agree with that, but we shouldn't pretend we aren't paying for it, one way or another.
Lorraine Collins is a writer who lives in Spearfish. She can be reached at

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