The state’s ConnectSD initiative, which began in 2019, had helped bring broadband access to 91% of South Dakota by 2024. A state report noted the remaining 9% would be costly, given the price of bringing miles of fiber to remote areas with few customers. 

The broadband initiative has cost $300 million so far, with funding from federal, state and private sources. Gov. Larry Rhoden announced recently that the state will soon receive another $72 million in federal funding for the effort.

A little more than a third of the new funding will go toward  “Low Earth Orbit Satellite” technologies, like SpaceX’s Starlink, to reach 2,705 of the 7,060 locations in the state targeted for the funds. Most of the other targeted connections will come by way of fiber-optic cable, and 177 will come via signals beamed from cellular towers.

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The satellite funding will not be used to pay for individual subscriptions, said a spokesperson for the Governor’s Office of Economic Development. 

“Instead, the award reserves network capacity with the provider so service is available in those locations,” said Bri Vande Pol. “The provider is reimbursed on a per-location basis only when a customer subscribes to the service.”

Vande Pol said the federal funding requires providers to make high-speed internet available to each eligible location for at least 10 years. She said the provider receives 25% of the award upon confirming service is available, and the remaining payments for the reserved network capacity are made quarterly over the 10-year period.

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The new federal money comes from the Broadband Equity, Access and Deployment program, authorized by the 2021 Infrastructure and Jobs Act, passed during the Biden administration.  

“Under the Trump administration’s changes to that program, states are encouraged to use a technology-neutral approach and connect locations in the most efficient way possible,” Vande Pol said. 

“In some of South Dakota’s most remote areas, Low Earth Orbit satellite service is a strong, reliable solution that meets performance standards while allowing us to maximize the reach of available BEAD funding,” she added. 

As of June 2025, South Dakota’s ConnectSD program had used $84.4 million in state general funds, $88.5 million in federal funds and $129.6 million in private investment from broadband providers to connect about 31,000 locations. The state and federal money has mostly been spent on grants to service providers, to help them expand their networks.

Rhoden’s latest proposed budget asks lawmakers to authorize $87 million in federal funding to be spent on broadband in the coming fiscal year.