If the South Dakota voters approve a constitutional amendment letting the legislature treat 'agricultural property' as a separate class for school tax purposes, does that mean a farmer's household goods (furniture, appliances, personal items) also get classified as agricultural property under that classification?

Plain-English summary

South Dakota's 1965 legislature passed two pieces that worked together to restructure how agricultural property was taxed for school purposes.

The first piece was Chapter 275 of the 1965 Session Laws (House Joint Resolution 6), a proposed constitutional amendment to Article VIII, Section 15 of the South Dakota Constitution. The existing constitutional text empowered the legislature to "classify properties within school districts for purposes of school taxation" and to "constitute agricultural lands a separate class." The amendment would change the word "land" to "property," broadening the legislature's reclassification authority to cover both real and personal agricultural property.

The second piece was Chapter 282 of the 1965 Session Laws, which addressed property classifications and mill levies. Chapter 282's effective date was contingent: it would only take effect after January 1, 1967, and only if the voters approved the constitutional amendment at the 1966 General Election.

The AG's explanatory statement to the Secretary of State (for the ballot) made the legislative intent explicit: "The intent of the amendment is to empower the Legislature to constitute all agricultural property as a separate class."

A tax official asked the AG whether the term "agricultural property" would include household goods of farmers. The AG answered yes, on the following reasoning:

• Chapter 282 by itself did not include any definition of "agricultural property" that picked up household goods. But Chapter 282 was contingent on the constitutional amendment, so it had to be read in light of the amendment.
• The constitutional amendment, as the AG had explained on the ballot, empowered the legislature to treat "all agricultural property, personal property as well as real property" as a separate class.
• Read together with the constitutional amendment, "agricultural property" in Chapter 282 meant "all personal property of individuals engaged in the pursuit of agriculture," unless the legislature later narrowed the term.
• Household goods of an agricultural-pursuit individual fell within "all personal property" of that individual. So they would be reclassified along with the rest of the agricultural property.

In short, the AG read the proposed constitutional amendment together with Chapter 282 and concluded that household goods would fall within agricultural property unless the Legislature limited the term. The opinion did not determine any tax rate or tax benefit.

Currency note

This opinion was issued in 1966. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. South Dakota's property tax classification system has been heavily restructured since 1966, including the later elimination of most personal property tax and various reorganizations of agricultural classification. The constitutional and statutory framework here is largely historical. Current property tax classification questions should be addressed under the current SDCL taxation provisions and constitutional provisions as they now stand.

What the opinion meant at the time

For county assessors who would have to implement the reclassification if voters approved, the opinion gave a working definition of "agricultural property": all personal property owned by an individual whose pursuit was agriculture. The reach was broad and included household goods, furniture, appliances, and similar items in a farm household.

For people engaged in agriculture, the opinion says the proposed classification would include their personal property, including household goods, unless the Legislature limited the term. It does not say what rate would apply.

For readers comparing the old and proposed constitutional language, the opinion explains that changing "agricultural lands" to "agricultural property" would allow personal property to be included in the separate class. It does not compare tax rates between classes.

For voters evaluating the constitutional amendment, the AG's explanatory statement on the ballot put them on notice that the change would extend beyond "agricultural lands" to include all "agricultural property," including personal property. That was relevant to whether voters wanted to ratify the broader reclassification.

Common questions

Q: Did the voters actually approve the constitutional amendment at the 1966 General Election?
A: The opinion was issued in anticipation of the vote, so the result was not in the opinion's text. Whether the amendment passed and Chapter 282 took effect is outside the scope of this opinion; verify the outcome and current law before relying on it.

Q: Could the legislature later narrow "agricultural property" to exclude household goods?
A: Yes. The AG's reading was that "agricultural property" meant all personal property of an agriculturalist "unless limited by the Legislature." The legislature retained authority to define the term more narrowly in subsequent statutory amendments, if it wanted to exclude household goods from that class.

Q: How would an assessor decide whether a particular person was "engaged in the pursuit of agriculture"?
A: The opinion does not provide a test for deciding who is engaged in the pursuit of agriculture.

Q: What about livestock, farm equipment, and crops?
A: The opinion does not separately classify livestock, farm equipment, or crops. It answers whether household goods can be included in agricultural property under the proposed constitutional amendment and Chapter 282.

Q: What about the farmstead house itself (as opposed to the land)?
A: The opinion focused on personal property (household goods inside the house) rather than the house structure itself. The structure would have been classified as real property, and its classification as agricultural or otherwise would have depended on how the legislature implemented the amendment for real property.

Q: How did the prior constitutional language differ from the amendment?
A: The prior language allowed the legislature to "constitute agricultural lands a separate class." That phrase was narrower: it covered only land (real property used for agriculture), not personal property used in agriculture. The amendment changed "land" to "property" to broaden the legislative authority to all forms of agricultural property.

Background and statutory framework

The opinion addresses Article VIII, Section 15 of the South Dakota Constitution, which empowered the Legislature to classify property within school districts for school tax purposes.

Agricultural land had been a recognized separate class under the prior version of Article VIII, Section 15, which let the legislature "constitute agricultural lands a separate class." The 1965 amendment would change "land" to "property," extending that classification authority to personal property used in or associated with agriculture.

The 1965 legislature responded with the two-piece package. Chapter 275 of the 1965 Session Laws (House Joint Resolution 6) was the constitutional vehicle, putting the amendment on the 1966 General Election ballot. Chapter 282 of the 1965 Session Laws was contingent on voter approval of the amendment and would not take effect until after January 1, 1967.

The AG's role in this opinion was twofold. First, the AG's explanatory statement on the ballot articulated the intent of the amendment so voters knew what they were voting on. Second, the AG's interpretation of "agricultural property" in this opinion gave assessors and taxpayers advance notice of how the term would be read once the amendment took effect.

The breadth of the AG's reading (all personal property of an individual engaged in agriculture) was a significant interpretive choice. A narrower reading (only personal property used directly in agricultural production) would have excluded household goods. The opinion does not state the financial effect of that reading.

Citations and references

Constitutional provisions:

• S.D. Const. art. VIII, § 15 (legislative authority to classify properties within school districts for purposes of school taxation; agricultural lands as a separate class)

Statutes:

• Chapter 282 of the Session Laws of 1965 (property classification and mill levies; contingent on voter approval)
• Chapter 275 of the Session Laws of 1965 (House Joint Resolution 6; constitutional amendment to Article VIII, Section 15, changing "land" to "property")

Source

• Landing page: https://atg.sd.gov/OurOffice/OfficialOpinions/opinionhtml.aspx?id=1732

Original opinion text

STATE OF SOUTH DAKOTA
OFFICE OF THE ATTORNEY GENERAL
July 27, 1966

Albert Gunderson
State Representative
Lesterville, South Dakota 57040

OFFICIAL OPINION NO. 67-68 pg. 9

Taxation. Interpretation of the term "agricultural property".

You have requested my official opinion as to whether or not household goods would be included in the definition of agricultural property provided in Chapter 282 of the Session Laws of 1965.

That Chapter is entitled, "An Act to amend Section 57.0332 of the 1960 Supplement to the South Dakota Code of 1939 as amended by Chapter 210 of the Session Laws of 1964 and Section 57.0514 of the 1960 Supplement to the South Dakota Code of 1939 as amended by Chapter 213, Session Laws of 1964 relating to classifications of property for tax purposes and the mill levies thereon." By its provisions, it would not become effective until after January 1, 1967 and then only in the event House Joint Resolution 6, Chapter 275, Session Laws of 1965 were to be approved by the electors of this state at the General Election in 1966.

Chapter 275 would amend Section 15 of Article VIII of the Constitution of this State in changing the word "land" to "property" thereby empowering the Legislature to classify property within school districts for purposes of school taxation, and allowing agricultural "property" to be constituted a separate class.

The explanatory statement furnished the Secretary of State for use on the ballots is set forth below:

"Explanatory statement by the Attorney General:

"Section 15 of Article VIII of the South Dakota Constitution provides that the Legislature is empowered to classify properties within school districts for purposes of school taxation, and may constitute agricultural lands a separate class.

"If the Constitution is changed by adoption of the proposed amendment then the Legislature will be empowered to constitute all agricultural property, personal property as well as real property, as a separate class of property for taxation.

"The intent of the amendment is to empower the Legislature to Constitute all agricultural property as a separate class."

Therefore, in answer to your question, I must state Chapter 282 Session Laws of 1965 would not in and of itself include household goods as agricultural property. It must be taken in context with Chapter 275, Session Laws of 1965. In my opinion, the term agricultural property, unless limited by the Legislature, means all personal property of individuals engaged in the pursuit of agriculture and would therefore include household goods.