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Bill

HB 1186

provide for the revision and eventual repeal of the employer's investment in South Dakota's future fee.

2025 Regular Session Introduced by Aaron Aylward and 10 co-sponsors

Bill phases out South Dakota's mandatory employer apprenticeship fee, reducing workforce training funding without specifying replacement revenue sources.

House of Representatives Reconsidered , Passed, YEAS 32, NAYS 36 H.J. 399
#fees #fund #reemploymentassistance #sunsetclause
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Bill Summary · HB 1186

Legislative bill overview

HB 1186 seeks to revise and eventually repeal South Dakota's "employer's investment in South Dakota's future fee," commonly known as the apprenticeship tax. This fee requires employers to contribute a percentage of payroll toward workforce development and apprenticeship programs. The bill would phase out this mandatory employer contribution over time.

Why is this important

The apprenticeship fee generates revenue for South Dakota's skilled workforce training initiatives, which support career pathways in trades and technical fields. Repealing it would eliminate this funding source, potentially affecting apprenticeship program availability and employer-sponsored training opportunities across the state. This represents a fundamental shift in how South Dakota funds workforce development.

Potential points of contention

  • Workforce funding gap: Eliminating the fee removes dedicated revenue for apprenticeships without specifying alternative funding mechanisms, which could reduce training opportunities and skilled worker pipelines
  • Business vs. training balance: Employers benefit from lower payroll costs but may lose access to state-supported apprenticeship infrastructure and support services
  • Legislative split: The narrow passage margins (32-38 and 32-36 votes) and intent to reconsider indicate significant disagreement within the House about the bill's merits

Compiled from official sources — confirm details with the bill’s official record.

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