(C) South Dakota Searchlight
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Governor relents, appoints task force to reset prison talks after legislative loss • South Dakota Searchlight [1]
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Date: 2025-02-27
The fight to secure legislative approval for an $825 million men’s prison is lost for now, South Dakota Republican Gov. Larry Rhoden conceded on Thursday.
Instead of continuing to push for the 1,500-bed Lincoln County facility he hoped would earn support from South Dakota lawmakers, the governor has created a working group to study the state’s options and return conclusions in a midsummer special legislative session.
“We received the message that our current prison plan does not have the buy-in this legislative session,” Rhoden said during a press conference at the Capitol. “I’ve also heard agreement from pretty much everyone that we need a new prison. So I’d like to discuss what comes next.”
News of the task force follows a rough and unsuccessful ride for House Bill 1025, which would have unlocked funding and sparked construction of the prison about 15 miles south of Sioux Falls. The proposed facility was designed to replace the oldest parts of the state penitentiary in that city, but the $825 million price tag – which did not include ongoing operating costs or the cost to build roads in the rural location – and fierce opposition from its neighbors were among the factors that put support out of reach.
The news of a reset was welcome for Doug Weber, a former chief warden with the state Department of Corrections. He spent weeks meeting with, talking to and sending letters to lawmakers questioning the state’s plan.
“Still have a little work to do, but the heavy lift is done,” Weber told Searchlight via text on Thursday. “I’m very, very happy.”
Working group to study options
Lt. Gov. Tony Venhuizen will chair the working group, dubbed “Project Prison Reset” in Rhoden’s executive order. Its aims are to assess and determine the need for a new facility, working with a consultant, to decide on the facility’s size and location, and to report its findings to a special session of the Legislature on July 22. The group will meet four times between April 2 and that date.
The order makes multiple references to “a” prison, but Rhoden said “all options are on the table.”
A prior consultant’s report offered up a 1,300-bed men’s prison as its top recommendation, but also listed multiple options for smaller prison projects across the state, in places like Yankton, Rapid City and Springfield. It also suggested that a site called West Farm, located west of Sioux Falls and currently used for juvenile inmates, could serve as a smaller-than-ideal but workable area for a men’s prison.
We received the message that our current prison plan does not have the buy-in this legislative session. – Gov. Larry Rhoden
A special session might allow the state to resume work at the Lincoln County site, at the initially planned-for size or smaller, or to begin work at any other site, during the 2025 construction season.
The state’s $825 million guaranteed maximum price for the 1,500-bed prison plan expires March 31, and Rhoden’s team repeatedly warned legislators that delay would push up the price.
“Time is money on a project like this,” Ryan Brunner, a senior policy adviser for Rhoden, said during Thursday’s press conference. “And so I think the reason you keep all options on the table is to try and look at all those options, but we want to be the best steward of the taxpayer money that we can.”
Money spent, money to spare
Rhoden’s task force may be focused on all options or potential sites, but leaving behind the Lincoln County site would also come with a cost unrelated to inflation.
Lawmakers allocated $62 million for design and prep work on the 1,500-bed prison site in previous sessions. Almost all of that money had been spent or obligated as of Thursday.
Some of the cash, $10.5 million, came from the federal American Rescue Plan Act. The city of Lennox collected that for agreeing to accept the proposed prison’s wastewater.
At the press conference, Brunner said the state has also inked deals with a rural electric co-op and water system for a stake in infrastructure upgrades. Those contracts, worth a total of $7.1 million, are meant to serve the proposed prison, he said, but also to service other customers in the area.
After the press conference, Brunner sent South Dakota Searchlight a rough breakdown of where the $62 million has gone or is set to go.
The state’s paid $44.4 million in bills, inclusive of the $10.5 million to Lennox. It also has $4.7 million in outstanding bills for work that’s already been done, and $5 million left to pay for its stake in the utility upgrades.
“The remainder of the $62 million,” Brunner said, around $7.9 million, “is under contract for services that we are pausing at this time.”
There’s another pool of funding to consider in the face of the men’s prison’s failure in the 2025 session: $182 million. That’s the amount of money that HB 1025 would have committed to the prison project.
Lawmakers speculated last week that those funds could be used to help launch an interest-bearing fund for the state’s unclaimed property. Assets left behind for three years revert to the state. The money is a perpetual liability, but much is never collected. Lawmakers are considering proposals to put the money into a fund to earn interest, and to ask voters to let the state’s investment council manage the money in hopes of using it to earn more interest by way of the council’s management.
Rhoden, however, would still like to see the money committed to prison funding.
“He does not believe that it should be spent on anything else,” spokeswoman Josie Harms told Searchlight.
Lawmakers created an incarceration construction fund years ago in hopes of paying for a prison in cash. With the interest it’s earned, that fund sits at more than $600 million.
Plan earns praise from prison critics
One of the lawmakers most critical of Rhoden’s preferred plan was Rep. Karla Lems, R-Canton, who represents some of the landowners surrounding the site. There is still a pending lawsuit from some of those landowners, which seeks to force the state to get a county zoning permit for the project. That case awaits a hearing with the state Supreme Court.
Lems is one of the eight House members on the Project Prison Reset task force.
“This is a way forward,” Lems told Searchlight. “I am more than willing to be part of a solution, moving ahead to discuss alternatives.”
Rep. Erin Healy, D-Sioux Falls, will also be part of the task force, one of two Democratic lawmakers in the group. The other is Sen. Jamie Smith, also of Sioux Falls.
In a press release on the Democrats’ priorities, Healy said the pair will work to guide the conversation toward rehabilitation efforts.
Smith is the sponsor of a bill to rename the DOC the Department of Corrections and Rehabilitation, which earned unanimous support in the Senate and awaits action by the House.
The task force includes largely Sioux Falls-area lawmakers, as well as law enforcement leaders, legislative leadership and a representative, Howard Republican Tim Reisch, who formerly served as Department of Corrections secretary.
In addition to Venhuizen, Lems, Reisch, Smith and Healy, the task force will also include the following people:
House Speaker Jon Hansen, R-Dell Rapids.
House Majority Leader Scott Odenbach, R-Spearfish.
Rep. Greg Jamison, R-Sioux Falls.
Rep. Brian Mulder, R-Sioux Falls.
Rep. Jack Kolbeck, R-Sioux Falls.
Senate President Pro Tempore Chris Karr, R-Sioux Falls.
Senate Majority Leader Jim Mehlhaff, R-Pierre.
Sen. Ernie Otten, R-Tea.
Sen. Mark Lapka, R-Leola.
Sen. Joy Hohn, R-Hartford.
Sen. Steve Kolbeck, R-Sioux Falls.
Minnehaha County Sheriff Mike Milstead.
Former Circuit Court Judge Jane Wipf-Pfeifle (retired).
Former Division of Behavioral Health Director Tiffany Wolfgang.
Yankton Police Chief Jason Foote.
Minnehaha County State’s Attorney Daniel Haggar.
Attorney General Marty Jackley.
South Dakota Gov. Larry Rhoden’s press conference on Feb. 27, 2025. (Courtesy of SDPB)
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