A fierce fight is rapidly taking shape behind the scenes in the South Dakota House of Representatives regarding SB 169, a one-sentence piece of legislation on insurance subrogation sponsored by Sen. Nancy Turbak Berry, D-Watertown. The bill originally failed in the Senate 17-18 last week, then was given a second chance on a reconsideration vote of 18-16 the next day. The trail took an unusual twist when one of the original co-sponsors, Sen. Dennis Schmidt, R-Rapid City, was excused for that afternoon as the bill came up for debate again. That suggested the bill would be two “yes” votes short of the minimum 18 needed for passage. However, Sen. Julie Bartling, D-Burke, changed sides from an opponent to a supporter when the roll call came to her. That produced a 17-17 tie, with Lt. Gov. Dennis Daugaard presiding at the time. He cast the decisive “aye” vote to allow the bill to pass.
In the Senate hearing, lawyers Verne Goodsell of Rapid City, Rex Hagg of Rapid City and Mike DeMersseman of Rapid City all testified for the bill, all speaking for themselves. Opposing the legislation are lawyers representing insurance providers, including Mike Shaw of Pierre for the Property Casualty Insurance Association of America, Dennis Duncan of Parker for Dakotacare, Dick Tieszen of Pierre for State Farm Insurance and Dick Gregerson of Sioux Falls for Wellmark Blue Cross Blue Shield of South Dakota.
The vote by Daugaard caught the insurance side off guard. His position becomes additionally interesting because he is the apparent frontrunner for the 2010 Republican nomination for governor. He is supported 100 percent in his candidacy by Republican Gov. Mike Rounds, whose livelihood is in insurance and real estate. If the Rounds administration took an official position on the bill, however, it wasn’t openly evident, with no one testifying from the administration on the legislation either way.
The issue is one of the few where four of the candidates for governor will be on the record with a vote. Senate Democratic leader Scott Heidepriem of Sioux Falls voted for the bill, putting Heidepriem and Daugaard on the same side, while Senate Republican leader Dave Knudson of Sioux Falls and Sen. Gordon Howie, R-Rapid City, opposed it. Daugaard, Heidepriem and Knudson are attorneys, as is Turbak Berry — who by the way might be facing a challenge for Senate re-election from former Sen. Lee Schoenbeck, R-Watertown, who is an attorney. During his most recent time in the Senate, Schoenbeck pushed a variety of changes to limit the lieutenant governor’s role; that was while Schoenbeck was still planning to run for the Republican 2010 nomination too.
The basic issue in the Turbak Berry legislation is whether an insurance company can recover from someone else for bodily injury or death or property damage until the person covered by the insurance company is made whole. Three-quarters of the Senate’s Republican majority voted against the bill, while only two of the Democrats did. This could become one of those issues that resonate long into the campaign season this spring and fall, after the legislative season wraps up at the end of March.