Whoever’s mad about high property taxes apparently isn’t mad enough to get the Legislature to take action. The only big property tax bill left standing appears to be Governor Larry Rhoden’s wimpy Senate Bill 96, which passes the buck to counties by letting them impose a half-percent sales tax for the exclusive purpose of offsetting property tax reductions. SB 96 creaked through the Senate Monday on a 20–14 vote, but only after rookie Senator Joy Hohn (R-9/Hartford) amended the bill to clarify that counties cannot prevent residents from referring newly passed sales tax ordinance to a public vote.
SB 96 is remarkable in reversing the Legislature’s long-standing aversion to giving the counties any additional taxing authority. But as a budget-neutral measure, SB 96 does nothing to help counties address budget shortfalls. As I noted in my read of the Governor’s fiscal estimate, a county sales tax would probably only knock down homeowners’ property taxes by 25%, since SB 96 won’t lower levies for schools, cities, and other taxing districts. The savings would be even less in counties like Turner, Clay, Custer, Fall River, McCook, and Marshall, where the Governor’s figures show a 0.5% county sales tax would fall well short of current property taxes on owner-occupied homes. And homeowners will pay a big chunk of their tax savings back to their counties at the local grocery and hardware stores.
But the Legislature can’t work up the courage to provide tax relief themselves and raise taxes to pay for it. Among the property/sales tax swaps they’ve nuked is House Bill 1308, rookie Representative Tim Czmowski’s (R-6/Sioux Falls) plan to zero levies on homes statewide and raise the sales tax to 5% to compensate local taxing districts and cover state budget items. Rep. Czmowski even got a fiscal note from the LRC saying that his figures worked out better than I thought, with the extra sales tax generating enough revenue to completely cover the lost property tax and ultimately leave over $63 million for the state to raise pay for state workers, school employees, and Medicaid providers. Unmoved, the House killed HB 1308 yesterday on a 24–42 vote.
Senator Taffy Howard (R-34/Rapid City) isn’t happy that the Legislature is passing the buck but not comprehensive statewide property tax reform:
Rapid City Republican Sen. Taffy Howard stood in the South Dakota Senate on Monday, saying she’d begrudgingly vote for authorizing counties to charge sales taxes.
“I’m not happy that we’re going to go back to our citizens and say, ‘Probably the only way we’re going to get property tax relief this year is through a new tax,’” Howard said. “I find that abhorrent” [Makenzie Huber, “County Sales Tax Emerges as Last Major Property Tax Reduction Proposal Standing in Legislature,” South Dakota Searchlight, 2026.02.24]
She’ll have a chance to test voters’ abhorrence in a few months as well. If the Legislature is misreading misread the electorate’s property-tax anger, Senator Howard should be able to rally like-minded property-tax slashers to primary the Republican balkers and come to Pierre in 2027 to take a real swipe at property taxes.