State Rep. John Hughes, R-Sioux Falls, listens as Lt. Gov. Tony Venhuizen speaks to state lawmakers prior to the annual State of the State address on Jan. 13, 2026, at the Capitol in Pierre. (Photo by Meghan O’Brien/South Dakota Searchlight)
PIERRE — A proposal to require local elections when a school board decides to exceed property tax limitations failed Wednesday in the South Dakota House on a 29-39 vote, and an effort to reconsider the bill fizzled on Thursday.
Its House sponsor, Rep. John Hughes, R-Sioux Falls, had announced an intent to seek a reconsideration, but ultimately gave up that effort.
School districts can already “opt out” of property tax limitations set by the state and raise more revenue, and local residents can petition that decision to a public vote.
The bill says the school board could decide on an opt-out with a two-thirds vote, but the decision would then go to a mandatory election. It would also require boards to outline how long the opt-out would run and the “total maximum dollar amount of taxes payable over the full term.”
There are 79 school districts opt-outs across the state, according to the Legislative Research Council, resulting in $43 million in excess property taxes.
Supporters of the bill, including Rep. Terri Jorgenson, R-Piedmont, said it increases transparency and local control for taxpayers.
“All this does, it simply adds taxpayer consent at the final step,” Jorgenson said. “I think it’s an unfair burden that if they want to have a voice, they have a very short window to go and get a petition, to go and get all their signatures, and they’re paying the bills.”
Some opponents to the bill said the reason school districts make the decision to opt out is that the state doesn’t provide enough funding for their budgets.
“You know why they’re having opt-outs? Because we’re not doing our job here,” said Rep. Roger DeGroot, a Republican from Brookings. “This is not about transparency, it’s about control.”
A few who spoke against the bill said they trust school board members and superintendents to make decisions that benefit the community, just like state representatives trust those on the legislative budgeting committee.
“All of us sitting here, we rely on our appropriators to make those good decisions with the state’s money,” said Rep. Tim Walburg, R-Madison. “Why would we not trust the school districts, the superintendent, the school board to do the same thing?”
Others expressed concern about how many people would turn out for an election. Republican Rep. Brian Mulder of Sioux Falls said that people who want to weigh in on budget decisions for their school district could show up to board meetings.
“People have the opportunity to influence these decisions, but they’re not exercising that opportunity,” he said. “So, I’m not convinced that they’re going to exercise the opportunity to go vote either.”
The South Dakota chapter of Americans for Prosperity said legislators “took a step in the wrong direction” by voting down the bill.
“In a time when property taxes are the largest issue for South Dakotans, we believe taxpayers should be able to weigh in before school districts raise their taxes above statutory limits,” State Director Jennifer Beving said in a statement Wednesday.
The Senate supported the bill last month on a 20-14 vote. The bill’s prime sponsor is Sen. Sue Peterson, R-Sioux Falls.
