protect residents from increased utility costs and utility shortages caused by data centers, to clarify authority to regulate data centers, and to modify provisions pertaining to the purchasing of goods and services by a data center.

26.991.18 101st Legislative Session 235

2026 South Dakota Legislature
Senate Bill 235

Introduced by: Senator Crabtree

Underscores indicate new language.
Overstrikes indicate deleted language.
An Act to protect residents from increased utility costs and utility shortages caused 1
by data centers, to clarify authority to regulate data centers, and to modify 2
provisions pertaining to the purchasing of goods and services by a data 3
center. 4
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA: 5
Section 1. This Act is known as the "Data Center Bill of Rights for Citizens." 6
Section 2. That a NEW SECTION be added to chapter 10-45: 7
There are exempted from the provisions of this chapter, and the tax imposed by 8
it, the gross receipts from a purchase made by a data center, as defined in section 4 of 9
this Act. 10
Section 3. That a NEW SECTION be added to chapter 10-46: 11
There are exempted from the provisions of this chapter, and the tax imposed by 12
it, the gross receipts from a purchase made by a data center, as defined in section 4 of 13
this Act. 14
Section 4. That a NEW SECTION be added to a NEW CHAPTER in title 49: 15
For purposes of this chapter, "data center" means a centralized repository for the 16
dissemination, management, processing, and storage of electronic data and information. 17
Section 5. That a NEW SECTION be added to a NEW CHAPTER in title 49: 18
The operator of a data center shall pay for all costs associated with the provision 19
of electricity to the data center. 20
A provider of electricity may not: 21
26.991.18 2 235
Underscores indicate new language.
Overstrikes indicate deleted language.
(1) Increase fees, rates, or surcharges imposed on residential customers for the 1
purpose of financing, offsetting, or subsidizing a data center's infrastructure costs, 2
service demands, or utility consumption; or 3
(2) Allocate to residential customers any cost associated with the distribution, 4
generation, or transmission infrastructure, or any other cost, attributable to the 5
data center. 6
Section 6. That a NEW SECTION be added to a NEW CHAPTER in title 49: 7
The state may not preempt or otherwise limit the authority of the governing body 8
of a county, municipality, or other political subdivision to adopt ordinances and resolutions 9
limiting, prohibiting, or otherwise regulating the construction, development, or operation 10
of data centers. 11
Section 7. That a NEW SECTION be added to a NEW CHAPTER in title 49: 12
Prior to commencing operation in this state, the operator of a data center shall 13
provide notice of projected water consumption to each local water provider in the area in 14
which the data center is proposed to be located. Each water provider receiving notice 15
pursuant to this section shall determine whether the data center's projected water 16
consumption is compatible with the local water supply and issue that determination in 17
writing to the operator. The operator shall present a copy of each notice and determination 18
to the Board of Water Management. 19
If the board receives a determination from each applicable water provider that the 20
data center's projected water consumption is compatible with the local water supply, the 21
board must issue, to the operator and the general public, a written statement that the 22
operator has satisfied the requirements of this section. 23
Notwithstanding the board's issuance of a written statement pursuant to this 24
section, the data center may not consume an amount of the local water supply exceeding 25
limits established by order of the board, after allocation to residential and essential public 26
services. In establishing allocation limits under this section, the board shall seek to ensure 27
water availability and prevent disproportionate use of water by data centers. 28
Section 8. That a NEW SECTION be added to a NEW CHAPTER in title 49: 29
The operator of a data center that is authorized to operate in this state pursuant 30
to this chapter, shall, at the time and in the manner prescribed by the Board of Water 31
26.991.18 3 235
Underscores indicate new language.
Overstrikes indicate deleted language.
Management, submit to the board a semi-annual report regarding the data center's water 1
use. The report must contain average usage data and certify compliance with this section. 2
The board shall make the usage data contained in the report available to the public. 3