Last month Governor Rhoden’s Prison Task Force made clear that if the Legislature will approve the money, the state will build a new prison in Sioux Falls, not in recalcitrant Lincoln County or any of the sites outside the Sioux Falls metro area that signaled an apparently fickle interest. Yesterday Governor Rhoden signaled his preference for a specific site in northeast Sioux Falls with a $12.5-million land-swap purchase agreement:
The land in question is approximately 148 acres in northeast Sioux Falls along Benson Road (the “Benson Road site”). The State of South Dakota will only complete the purchase if approval to acquire the site is granted by the South Dakota Legislature.
If the purchase of the Benson Road site is approved by the Legislature on September 23, 2025, the Lincoln County site would no longer be owned by the State. As private property, any agricultural use or development of this land would be subject to county zoning [Office of the Governor, press release, 2025.08.08].
The site Governor Rhoden would purchase is 3.5 miles northeast of the current penitentiary, which the Prison Task Force deemed unacceptable in April. The new prison would sit just east of the parcel where Wholestone Farms considered building a slaughterhouse before deciding in March 2023 that Nebraska and Iowa are more open for business.
Seth Tupper breaks down the basic payments and land swap in the purchase agreement:
The state has a purchase agreement with TCB LLC (which is registered to Patty Nohr of Sioux Falls) and Lynnette Sue Unzelman. Under the terms of the agreement, the state would pay TCB $11.56 million for its 137 acres of Sioux Falls land, including a $1 million payment to the Myrl and Lois Unzelman Family Fund at the Sioux Falls Area Community Foundation. For the remaining 11 acres of land, the state would pay $937,858 to Lynnette Sue Unzelman.
In addition, the state would transfer ownership of its 320 acres in rural Lincoln County — worth an estimated $4.5 million — to TCB, raising the total value of the deal to $17 million [Seth Tupper, “Governor Announces $17 Million Deal for Sioux Falls Prison Site, Subject to Legislative Approval,” South Dakota Searchlight, 2025.08.08].
The agreement promises seller TCB LLC $50K in nonrefundable earnest money within two weeks of execution and another $100K if the Legislature can’t agree on a prison plan at the Special Session Governor Rhoden called for September 23. The state also promises to reimburse TCB for any damages it has to pay to a farmer who is leasing the land if the sale proceeds and that state starts digging and wrecks any crops. Closing happens within 30 days of the Special Session, with an extension to May 1, 2026, in case of Legislative dilly-dallying.