STATE OF SOUTH DAKOTA
OFFICE OF
THE ATTORNEY GENERAL

February 19, 1969

Roger A. Schiager
State's Attorney, Minnehaha County
Sioux Falls, South Dakota 57102

OFFICIAL OPINION NO. 69-16

Determination of time of tax levy and  spreading of tax levy in determining borrowing of money and issuing warrants by school districts

Dear Mr. Schiager:

You have requested my official opinion to interpret the meaning of when taxes are levied, or when a school tax is spread, as such terms are used in SDC 1960 Supp. 15.2216, as amended by Chapter 48 of the Session Laws of 1965, and SDC 1960 Supp. 15.2214.

SDC 1960 Supp. 15.2216, as amended, authorizes a school district to borrow money from any source which in no case shall "exceed the sum of ninety-five percent of the amount of uncollected taxes levied by the school district board for the current school year."

SDC 1960 Supp. 15.2214 provides the method of determining whether or not the issuance of a warrant by the school district board is unlawful. In order to determine the amount of money in any particular school district fund, subject to depletion by the issuance of warrants, the current assets of the fund at the time of issuing such warrant, "plus the uncollected taxes of such fund allocated for the current school fiscal year for which a levy has already been spread," less outstanding warrants or promissory notes issued against such fund must be computed. This amount of money determines the top limit for issuing valid warrants.

To determine the questions submitted, resort must be had to other sections of the statutory law, in order to interpret these legislative directions.

Under our system of taxation, it is elementary that the tax levy for a particular year are collected during the next year, as all taxes become due on the first day of January of the year following that in which such taxes are assessed. Generally speaking, before such taxes are due there must be an assessment of all property subject to taxation, a levy of such tax, and the imposition of such tax either upon property or the person who is to pay such tax.

Insofar as the levy of school taxes is concerned, the provisions of SDC 1960 Supp. 15.2208 make it implicit that such are levied by the school district board before August 15th of each year. At such time the school board must prepare a budget showing the necessary moneys it will need to operate, "and by resolution adopt a levy in dollars to meet such budget." By the 15th day of August of each year, the school district clerk must report such levy (in dollars) to the County Auditor, who thereafter must "spread a levy in mills over the taxable property of the school district sufficient to raise the money requested by the school district subject to the legal mill limitation on any of the funds as provided by law."

Insofar as our tax law is concerned, all levies of taxes must be expressed in dollars by the particular taxing district, and such amount of the tax levy must be certified to the County Auditor. SDC 57.0510 requires all taxing districts, which include school districts, to forward such certificates to the Auditor on October 1 of each year. SDC 57.0601 requires the County Auditor, after receiving all of such tax levies, to calculate the requisite mill levy to raise the amount of money required by each of such taxing districts, and extend the same upon the tax lists. SDC 57.0603 and 57.0604 require that the County Auditor retain the tax list when completed, but "by the first day of January following the date of such levy" to deliver a duplicate copy of the tax list, accompanied by a warrant under the County Auditor's seal to collect such taxes, to the County Treasurer.

It is my opinion that the term "spreading tax levies" or the like, as used in the statutes, and also in common language, refers to the process of reducing the total tax levy from all taxing districts to ascertain the aliquot part thereof each taxpayer must pay by way of taxes to support such taxing districts. This is accomplished by the ascertainment of the mill levy and the extension of such mill levy as against the assessed value of all property subject to such taxes. In other words, it is my opinion that "spreading a tax levy," and "extending the mill levy on the tax lists" are synonymous. With these basic statutory provisions in mind, the practical questions raised by determining when are taxes "levied," and when are they "spread," may be answered.

SDC 1960 Supp. 15.2216, as amended by Chapter 48, Laws of 1965, authorizes the borrowing of money on taxes to be collected during the ensuing year after August 15th of any year.

SDC 1960 Supp. 15.2214 provides that in determining the amount of money in any particular school district fund, subject to depletion by warrants, that consideration may be given to the uncollected taxes for such fund may be used only after the County Auditor has extended on the tax list and has completed the same. Under the statutes above quoted, the completion of such tax list may occur any time from October 1 to the ensuing January 1, and such extension of taxes, or the "spreading of tax levies" is evidenced by the delivery of the duplicate tax list with a warrant to collect the same to the County Treasurer. It is only after this process has been completed that it would be proper for consideration to be given to uncollected taxes in determining the amount of money in a particular fund subject to warrant.

Respectfully submitted,

Gordon Mydland
Attorney General