South Dakota
Bill to bring every school district opt-out to an election fails in SD
Thirty-nine legislators voted against a bill Feb. 4 in the South Dakota House of Representatives that would’ve brought every single school district opt-out to a public vote.
After Senate Bill 85 failed to pass, with 29 lawmakers voting for it and two excused, bill sponsor Rep. John Hughes, R-Sioux Falls, said he intended the bill to be reconsidered in the coming days, meaning the bill could’ve been heard again Feb. 5.
But by the time the House reconvened that day with SB 85 on the docket, Hughes didn’t choose to move to have the bill reconsidered.
He told the Argus Leader, in emails shortly after the bill was mentioned on the House floor, that it wouldn’t be reconsidered, and it’s most likely the case that the bill will remain dead. But that other bills affecting opt-outs are pending, and amendments could come forward.
Opt-outs allow school districts to raise additional operating funds beyond what they get in their existing tax levy, and in state aid, by “opting out” of those limitations to collect more taxes from property owners in the district.
“Only time will tell how this issue works itself out and whether a mandatory referral requirement will reappear in some other bill,” Hughes told the Argus Leader.
Bill sponsor skeptical of trust in school administrators
Hughes would’ve had an uphill battle to change minds and flip votes, as many of the legislators who spoke in opposition to the bill staunchly defended education, local control and the financial decisions made by superintendents, school boards and school districts.
Those legislators cited the fact that only 14 districts passed opt-outs over the last year, with five of those being referred to an election, and all five passing.
SB 85 is one of 19 recommendations brought by the comprehensive property tax task force that met over the summer. Sen. Sue Peterson, R-Sioux Falls, brought both the bill and the recommendation, both opposed by the Sioux Falls School District (SFSD). Peterson said it was not a “silver bullet,” but part of the solution to solve the property tax problem in the state.
Peterson has also brought SB 223, which would require petitioners to gather only 50 signatures in 40 days to refer an opt-out to an election. The bill has been referred to the Senate State Affairs committee.
Hughes noted Feb. 4 that last year’s resolution to convene the task force was approved by 64 Representatives.
“One thing we have all seen from the floor vote on SB 85, the House in 2025-2026 thus far is talking out of both sides of its mouth on property tax reform and relief, and the voters should take that into consideration in June and November, if this session continues its present course on property taxes, and that we should just ‘trust the school administrations’ in South Dakota,” Hughes said in a statement Feb. 5.
Sioux Falls was a focal point of the bill
In House debate Feb. 4 and in the bill’s prior hearings, it was clear the most recent opt-out passed by the SFSD Board of Education, and the inability of petition circulators to gather enough signatures to bring the proposal to a vote, was a flashpoint that led to the bill’s creation.
That opt-out for $2.1 million over 10 years — or $21 million — needed 5,490 signatures to be referred to voters, but only 2,302 signatures were turned in by the deadline, in 20 days.
One of the most outspoken petitioners, Misty Furness, noted the cost for the district to hold an opt-out election — $63,000 — is far less than $21 million, and said SB 85 is about giving taxpayers a voice.
Peterson said Jan. 22 in the bill’s first hearing in the Senate Education committee that it shouldn’t be the responsibility of voters to gather petition signatures to prevent districts from spending over the limits that have been set for them.
During the Sioux Falls school board’s work session Feb. 4, shortly before the House started debating SB 85, school board president Nan Kelly said the bill wouldn’t solve the property tax issue “in any real meaningful way,” and said opt-outs have historically been used to fill the gap between what’s available in state and local funding, and what’s needed.
District business manager Todd Vik noted the Legislature increased state aid to education at only 1.25% last year and is proposing no increase this year, and said SB 85 will make it “much more difficult to opt out.”
Kelly said the bill sets a “very dangerous precedent” and could lead to similar legislation being proposed for cities and counties.
That’s something SFSD lobbyist Sam Nelson brought up in his testimony against the bill in the House Education committee Feb. 2, arguing that if proponents believed SB 85 was good for schools, it should be good for all local units of government, including the general bill and special appropriations passed by legislators.
Part of the reason opt-outs are in place is that “for years, we have not adequately funded public education, which is your constitutional obligation to do,” Nelson told the House Education committee on Feb. 2.
He noted that people who disagree with opt-outs or other decisions made by school board members have two ways to deal with it: showing up at school board meetings and making public comments, or “one of the greatest referendum tools,” the ballot box.
Rep. Brian Mulder, R-Sioux Falls, said he’d heard from SFSD that only one person made public comments on the budget cycle, and only two people emailed Superintendent Jamie Nold about the budget, noting that people already have the opportunity to influence school board and district decisions.
Districts ‘glibly ignore spending limits,’ proponents argue
In prior committee hearings, SB 85 was endorsed by lobbyists for the Freedom Foundation and Americans for Prosperity.
Legislators who spoke in favor of SB 85 Feb. 4 largely argued that taxpaying voters need to have a say in opt-outs that school boards want to pass, and that part of “local control” is for local school board voters to be part of decisions in their local school districts.
Hughes had argued that a number of school districts across the state “glibly ignore spending limits.”
In his rebuttal, he said his sons shouldn’t have to go to school board meetings and “plow through budgets” that make “all of us gloss over.”
He also said that in December, Nold gave a “wonderful defense for everything he’s doing to continue, according to the status quo,” and said that if legislators don’t pass SB 85, “we ought to just give everybody a trophy and go home.”
Rep. Terri Jorgenson, R-Rapid City, argued SB 85 is not about schools or education funding, but about taxpayers’ consent. She said there are 79 active opt-outs across the state levying $43 million in excess property taxes.
SB 85 takes tools out of education’s toolbox, opponents argued
In prior committee hearings, SB 85 was opposed by lobbyists for the Sioux Falls School District, Rapid City Area Schools, Associated School Boards of South Dakota, School Administrators of South Dakota, South Dakota Education Association, South Dakota United School Association, the Large School Group and the Greater Sioux Falls Chamber of Commerce.
Since the petition group in Sioux Falls didn’t gather enough signatures, ASBSD lobbyist Heath Larson said it’s possible local constituents were supportive of the district and trusted what school board members were doing.
Large School Group lobbyist Dianna Miller argued that putting a mandate like SB 85 on schools isn’t “limited government,” and said that the property tax problem shouldn’t be “solved on the backs of school districts” alone, something Rep. Mike Stevens repeated on the House floor.
Reps. Erik Muckey, Jim Halverson, Tim Walburg, William Shorma, Roger DeGroot, Keri Weems, Stevens and Mulder all spoke against the bill on the House floor.
DeGroot said school districts pass opt-outs because “we’re not doing our job here,” referring to legislators’ power to increase education funding in Pierre. He added the lack of a proposed increase in state aid to education this year “makes absolutely no sense to me at all.”
Stevens said all legislators do recently is “take tools out” of education’s toolbox, and that if SB 85 passed, “there’d be no more tools in that toolbox.” He noted districts must publish public notices and hold public hearings when school boards plan to vote on or pass opt-outs.
Walburg said he trusts his superintendent and school board members, and that the state shouldn’t dictate what they can do. He noted that 57% of his property tax bill went to schools, which he said was about $265 twice a year.
Halverson said one of the superintendents in his legislative district had asked him to vote no and respect local control. Weems also said constituents in her district value what their property tax does for education, and that she voted against the bill and in favor of local control.
While the race to secure the nomination for governor has dominated the headlines ahead of the June 2 primary, Republican voters will also choose a candidate for one of South Dakota’s two U.S. Senate seats.
Incumbent U.S. Sen. Mike Rounds, who is seeking a third, six-year term, holds a comfortable lead over his GOP primary challenger, Justin McNeal, a Navy veteran and business owner from Rapid City, according to the latest poll from News Watch and the Chiesman Center for Democracy.
Here is a recap of the two candidates along with their thoughts heading into the June 2 election. The winner of the Republican primary will meet Democrat Julian Beaudion and Independent Brian Bengs in the Nov. 3 general election.
Hometown: Fort PierreAge: 71Occupation: Insurance broker; businessman; former governor (2003-2011); U.S. senator since 2015In their own words:
Rounds provided the following statement to News Watch:
“Working in the U.S. Senate, I’ve stayed focused on results that matter for our kids and grandkids. That means keeping the government off your back and out of your business and wallet. That means keeping our communities safe and creating a business climate that encourages job growth to keep our kids in South Dakota. And that means safety through a commitment to our men and women in uniform.
This past summer, we worked with President Trump to pass the Republicans’ Working Families Tax Cuts legislation. Without Congressional action, the average South Dakota family would have seen a $2,500 tax hike this year. Our legislation not only prevented the largest tax increase in American history, but it also provided additional tax relief for hard-working South Dakota families. That includes no tax on tips, no tax on overtime and no tax on Social Security for nearly 9 out of 10 seniors.
We’ve accomplished some great things, but our work is not done. I am running for reelection to continue bringing results back home to South Dakota.”
Hometown: Rapid City (born in Illinois and raised in Texas)Age: 42Occupation: Business owner (Dakota BioChar); Navy veteran (2001-2007)In their own words:
“I’m feeling the people in South Dakota are ready for a change. The challenge we are running into is that not enough people know who we are, but as soon as they know who we are, it’s an easy decision for them,” McNeal told News Watch in a phone interview. “I don’t have millions and millions of dollars. I’ve been largely self-funding this race up to this point.”
McNeal, who is a licensed pilot, said he has flown his small plane to events throughout the state in an attempt to get his name out.
“I talk to people about the issues that matter and I tell them the biggest thing you can do to help me is tell 10 people about me and to go vote June 2. We need about 50,000 votes to win the primary,” he said.
McNeal is not critical of Rounds and conceded “he is very popular” but said Rounds has not done enough to tackle the country’s growing fiscal deficit.
“I don’t think Mike is doing a bad job. I’m just concerned with the federal debt and the people that got us into that mess are not going to be the ones to get us out of it,” McNeal said.
“This is going to cripple the country. It just seems like politicians are focused on what they can bring to their home district or home state. And the problem with that is every member of Congress is doing the same thing, so everyone is taking and taking without making sure we can pay for it.”
South Dakota News Watch is an independent nonprofit. Read, donate and subscribe for free at sdnewswatch.org. Contact politics and statehouse reporter Alexander Rifaat: 605-736-4396/alexander.rifaat@sdnewswatch.org.
South Dakota
Supreme Court ruling robs Native Americans of ‘silent partner’ in legislative redistricting – ICT
This is the second installment in a four-part series profiling the four candidates seeking the GOP nomination for governor of South Dakota.
DELL RAPIDS, S.D. – The city of Dell Rapids, roughly 20 miles north of Sioux Falls, labels itself “The Little City with the Big Attractions.” And it’s here, in a relatively humble law office off the main road leading into town, News Watch met with one of its biggest current draws.
Over the past few weeks, state House Speaker Jon Hansen has enjoyed a growing prominence in the race to be the Republican nominee for governor.
After polling at just 2% when he initially announced his candidacy in April of last year, Hansen, who at 40 is the youngest in the race, now finds himself within striking distance of being one of the two candidates that could make a potential runoff.
In a poll commissioned by News Watch and the Chiesmen Center for Democracy last month, Hansen, a lawyer by training, drew 18% of support from potential GOP primary voters.
If no candidate receives at least 35% of the vote on June 2, the runoff will be held eight weeks later, on July 28. The winner of that contest will meet Democrat Dan Ahlers, also of Dell Rapids, in the Nov. 3 general election.
So what does Hansen put his steady rise in the race down to after spending the previous few months being viewed as the long shot candidate?
“The debates were a huge factor because people across South Dakota were able to line up those four candidates on the stage and take a measure and get a sense of who is honest and who is genuine,” Hansen told News Watch.
In a poll of viewers after the first GOP gubernatorial debate on KELO-TV in March, Hansen was seen as the winner, while observers were also left impressed by his performance in the second debate co-moderated by News Watch and SDPB.
“The more people have been able to line up the four candidates, the more they have been coming our direction,” Hansen said.
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In the same News Watch/Chiesman poll from last month, 27% of respondents did not know Hansen, which, some observers believe, could indicate he has the most potential of the four candidates to grow his support.
“A lot of people hadn’t heard of us and in large part, it’s never been about us. Karla and I have been fighting for the issues. We’re not big self-promoters,” Hansen said, referring to his running mate for lieutenant governor, Karla Lems.
From tragedy to political awakening
Hansen’s early childhood was marked by the death of his father, who died from a self-inflicted gunshot wound.
Hansen describes the experience as “awful” but that it allowed him, his mother and his sister to grow closer.
“For awhile it was just my mom, my sister and I, and what really pulled us through that was the unconditional love we had for each other,” Hansen said.
His mother eventually remarried and they moved from Yankton, where he was born, to Dell Rapids, where he has lived for most of his adult life.
He said he had fond memories growing up in Dell Rapids, but he wasn’t the best of students. He also wasn’t interested in politics.
Hansen said that all changed when he got a job working at the local movie theater, where he befriended a female coworker involved in the pro-life movement.
“One day she brought up the issue of abortion and, after we had a bit of a back and forth, I told her. ‘I don’t get it. The baby doesn’t even know the baby exists. I don’t see what the big deal is?’ Then it got real quiet and I noticed that she started to cry. In that moment, I realized there was something I was missing,” Hansen said.
“I think a lot of people have those moments that get them engaged in the political process,” he said.
Hansen said the conversation not only awakened his desire to enter the political arena but that it also reconnected him to his Catholic faith.
He is married to his high school sweetheart, Sheila, and they have six children.
Hansen subsequently got involved in anti-abortion campaigns in 2006 and 2008, which didn’t turn out the way he wanted. In both years, South Dakota voters rejected initiatives that would have instituted a near-total ban on abortions.
“The pro-life side lost those fights, but it started the journey I’m on now.”
After completing an internship at the South Dakota Legislature during college, in 2010 Hansen successfully won an open seat in the state House against a Democratic opponent who, it turned out, was his high school government teacher.
“Believe me, he never saw it coming because I was not a good high school student,” Hansen joked.
Hansen served one term and, after his return to the Legislature in 2019, played a role in South Dakota eventually enacting an abortion ban in 2022. On the campaign trail, he has also touted his involvement in defeating Amendment G in 2024, which would have enshrined the right to an abortion in the state’s Constitution.
‘In the arena’
Hansen said his work on abortion underscores his ability to deliver for the conservative Republican agenda.
“I’ve not just talked. I’ve been in the arena fighting the fight on the issues,” Hansen said.
Besides abortion, Hansen also highlighted his work to lower property taxes, which has come under heavy scrutiny from one of his primary challengers, U.S. Rep. Dusty Johnson.
In recent weeks, Johnson has utilized his significant campaign war chest to attack Hansen’s role in the passage of a series of bills during this year’s legislative session that, in some fashion, lower property taxes in exchange for raising sales taxes.
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In particular, there is Senate Bill 245, which will create a property tax relief fund using money generated from the planned 0.3% sales tax increase set to take effect next year.
Former Gov. Kristi Noem enacted a law in 2023 that lowered the sales tax from 4.5% to 4.2% until 2027. Efforts to make the measure permanent were rejected in the state Senate.
Hansen said Johnson’s claims that Hansen has raised sales taxes are “disingenuous” and pointed out that, at least when it comes to the scheduled sales tax increase, it was a case of trying to make lemonade out of lemons.
“I just don’t think it’s appropriate for South Dakotans to give out tax breaks to some of the world’s richest tech companies. They want to come to South Dakota, they can pay taxes just like everyone else.”
– Republican gubernatorial candidate Jon Hansen
“We (the state House) wanted to make the cut permanent, but we didn’t have the votes in the Senate. Every year after, we tried to make that sales tax cut permanent and every year the Senate didn’t have the votes,” Hansen said. “So the reality is it was going up anyway.”
“The next best thing we could build a consensus around was take all that money, dollar for dollar, and put that towards property tax relief,” Hansen said, arguing that the break in property taxes will outweigh any rise in sales taxes.
Hansen said if he were to ascend to the top job in Pierre, he would focus on examining state finances to see where he could potentially cut more taxes.
“We’re going to look at our state budget and cut government spending and use that savings to provide more tax relief,” he said.
Hansen said he also wants to clean up what he sees as a culture of grift in Pierre that favors larger corporations over small businesses.
“It’s a breeding ground for corruption. You see it when people who sit on the Governor’s Office of Economic Development (GOED) board dole out money to certain companies then get executive jobs with those companies,” Hansen said, citing the recent example of CJ Schwan’s, a food manufacturer that hired a former GOED commissioner and received $69 million in state grants and loans.
“I don’t think it’s appropriate. It seems very Washington, D.C.-esque to me,” Hansen said.
Hansen’s hostility toward larger corporations is further illustrated by another piece of key legislation he passed in this past session.
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Along with Senate President Pro Tempore Chris Karr, Hansen passed Senate Bill 135, dubbed the Data Center Bill of Rights for Citizens, which puts certain restrictions in place for any future data center project.
He ruled out being open to providing data center companies any special tax privileges to operate in the state.
“I just don’t think it’s appropriate for South Dakotans to give out tax breaks to some of the world’s richest tech companies,” Hansen said. “They want to come to South Dakota, they can pay taxes just like everyone else.”
With the campaign entering the final stretch, what’s his strategy to win over voters before they vote?
“We’re going to continue being positive, share our vision of the state and show our track record of results,” Hansen said.
South Dakota News Watch is an independent nonprofit. Read, donate and subscribe for free at sdnewswatch.org. Contact politics and statehouse reporter Alexander Rifaat: 605-736-4396/alexander.rifaat@sdnewswatch.org.
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