remove the authorization to issue grants as part of a tax increment financing district.

26.794.13 101st Legislative Session 191

2026 South Dakota Legislature
Senate Bill 191

Introduced by: Senator Howard

Underscores indicate new language.
Overstrikes indicate deleted language.
An Act to remove the authorization to issue grants as part of a tax increment 1
financing district. 2
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA: 3
Section 1. That § 11-9-1 be AMENDED: 4
11-9-1. Terms used in this chapter mean: 5
(1) "Department," the Department of Revenue; 6
(2) "District," a tax increment financing district; 7
(3) "Governing body," the board of trustees, the board of commissioners, the board of 8
county commissioners, or the common council of a municipality; 9
(4) "Grant," the transfer of money or property to a transferee for a governmental 10
purpose that is not a related party to or an agent of the political subdivision; 11
(5) "Planning commission," a planning commission created under chapters chapter 11-12
2 or 11-6, a planning committee of a governing body of a political subdivision that 13
does not have a planning commission, or the governing body of a political 14
subdivision that does not have a planning commission or planning committee; 15
(6)(5) "Political subdivision," a municipality, as defined in § 11-6-1, or county of this 16
state; 17
(7)(6) "Project plan," the properly approved plan for the development or redevelopment 18
of a tax increment financing district including and all properly approved 19
amendments to the plan; 20
(8)(7) "Tax increment financing district," a contiguous geographic area within a political 21
subdivision defined and created by resolution of the governing body; 22
(9)(8) "Taxable property," all real and personal taxable property located in a tax 23
increment financing district; and 24
(10)(9) "Tax increment valuation," the total value of the tax increment financing district 25
minus the tax increment base as determined pursuant to § 11-9-19. 26
26.794.13 2 191
Underscores indicate new language.
Overstrikes indicate deleted language.
Section 2. That § 11-9-14 be AMENDED: 1
11-9-14. For the purposes of this chapter, the term "project costs" are mean any 2
expenditures made or estimated to be made, or monetary obligations incurred or 3
estimated to be incurred, by a political subdivision that, which are listed in a project plan 4
as grants or costs of public works or improvements within a district , plus any incidental 5
costs diminished by any income, special assessments, or other revenues, other than tax 6
increments, received, or reasonably expected to be received, by the political subdivision 7
in connection with the implementation of the plan. 8
Section 3. That § 11-9-15 be AMENDED: 9
11-9-15. For the purposes of this chapter, the term "project costs" means: 10
(1) Capital costs, including the actual costs of the construction of public works or 11
improvements, buildings, structures, and permanent fixtures; the demolition, 12
alteration, remodeling, repair, or reconstruction of existing buildings, structures, 13
and permanent fixtures; the acquisition of equipment; the clearing, over -14
excavation, and grading of land, including use of engineered fill and soil 15
compaction; and the amount of interest payable on tax increment bonds issued 16
pursuant to this chapter until the positive tax increments to be received from the 17
district, as estimated by the project plan, are sufficient to pay the principal of and 18
interest on the tax increment bonds when due; 19
(2) Financing costs, including all interest paid to holders of evidences of indebtedness 20
issued to pay for project costs, any premium paid over the principal amount thereof 21
because of the redemption of obligations prior to maturity, and a reserve for the 22
payment of principal and interest on obligations in an amount determined by the 23
governing body to be reasonably required for the marketability of obligations; 24
(3) Real property assembly costs, including the actual cost of the acquisition by a 25
political subdivision of real or personal property within a district, less any proceeds 26
to be received by the political subdivision from the sale, lease, or other disposition 27
of property pursuant to a project plan; 28
(4) Professional service costs, including those costs incurred for architectural, 29
planning, engineering, and legal advice and services; 30
(5) Imputed administrative costs, including reasonable charges for the time spent by 31
a municipal or county employee in connection with the implementation of a project 32
plan; 33
26.794.13 3 191
Underscores indicate new language.
Overstrikes indicate deleted language.
(6) Relocation costs; 1
(7) Organizational costs, including the costs of conducting environmental impact and 2
other studies and the costs of informing the public of the creation of a district and 3
the implementation of project plans; and 4
(8) Payments and grants made, at the discretion of the governing body, that are found 5
to be necessary or convenient to the creation of a district, the implementation of 6
project plans, or to stimulate and develop the general economic welfare and 7
prosperity of the state. No payment or grant may be used for any residential 8
structure pursuant to § 11-9-42Incidental costs diminished by any income, special 9
assessments, or other revenues, other than tax increments, received, or 10
reasonably expected to be received, by the political subdivision, in connection with 11
the implementation of the plan. 12
Section 4. That § 11-9-32 be AMENDED: 13
11-9-32. Moneys may only be paid out of the special fund only for the district 14
created under § 11-9-31 to pay project costs or grants of the district, to reimburse the 15
political subdivision for the payment of project costs or grants of the district, or to satisfy 16
claims of holders of tax increment bonds issued for the district. 17
Section 5. That § 11-9-46 be AMENDED: 18
11-9-46. The existence of a district shall terminate must be terminated when: 19
(1) Positive tax increments are no longer allocable to a district under § 11-9-25; or 20
(2) The governing body, by resolution, dissolves the district, after payment or 21
provision for payment of all project costs , grants, and all tax increment bonds of 22
the district. 23