SB 118 South Dakota Senate · 2026 Regular Session

deposit certain tax revenues into a homeowner tax reduction fund.

SB 118 creates a "homeowner tax reduction fund" in South Dakota's state treasury. Each year by January 31st, the treasurer must deposit either $100 million or 0.3% of revenues collected from specific property taxes (chapters 10-45, 10-46, 10-46E, 10-58, and § 32-5B-20) into this fund. The Department of Revenue will use these funds to provide property tax rebates for owner-occupied single-family homes, with money in the fund not allowed to transfer to the general fund and requiring annual budgeting through the general appropriation bill. The bill takes effect July 1, 2027.

Issues: ✓ Budget & Taxes

Bill status passed 3 of 5 stages cleared

Introduction

Jan 2026

Committee Review

Feb 2026

Senate Passage

Feb 2026

House Passage

Governor

Introduced Jan 26, 2026 Last action Feb 24, 2026

Maddy AI version diff · 1 comparison

What changed between versions

Introduced → Senate Taxation Engrossed · 4 edits · Feb 11, 2026

MODERATE

This bill establishes a new fund to reduce homeowner taxes by depositing a minimum of $100 million or a specific percentage of collected taxes from four major tax chapters into the Homeowner Tax Reduction Fund. It modifies existing statutes to ensure these funds are diverted from the general fund to this new reduction account, effective July 1, 2027.

Scope change

The bill expands the scope of tax revenue allocation by creating a new mandatory funding stream for homeowner tax reductions, whereas previously these revenues were deposited directly into the general fund.

FISCAL

Created a new mandatory deposit requirement where the Treasurer must place the greater of $100 million or a calculated percentage of taxes from Chapters 10-45, 10-46, 10-46E, and 10-58 into the Homeowner Tax Reduction Fund.

REQUIREMENT

Amended Sections 10-46-48, 10-46E-9, and 10-58-5 to explicitly exclude the newly created fund from the requirement that tax revenues be deposited into the general fund.

DEFINITION

Defined 'applicable percent' as three-tenths of one percent divided by the tax rate of the referenced chapters to determine the variable portion of the deposit.

TIMELINE

Set the effective date of the Act to July 1, 2027, delaying the implementation of the new funding mechanism.

Floor votes · Senate Feb 17, 2026

How they voted

20–14

Passed · 1 other

Total votes 35

Feb 17, 2026

D Democratic3

3 Yea

100% Yea

R Republican32

17 Yea 14 Nay 1

53% Yea

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Feb 24, 2026

Upper · Passed

Senate Do Pass Amended , Passed, YEAS 16, NAYS 17 S.J. 375

upper

Feb 17, 2026

Upper · Passed

Placed on calendar pursuant to JR 6F-6 , Passed, YEAS 20, NAYS 14 S.J. 271

upper

Feb 11, 2026

Upper · Passed

Taxation Report out of committee without recommendation as amended , Passed,

upper

Feb 11, 2026

Upper · Passed

Recalled from committee (Rule 7-7) , Passed, S.J. 245

upper

Feb 6, 2026

Upper · Passed

Taxation Deferred to the 41st legislative day , Passed, YEAS 4, NAYS 3 S.J. 11

upper

Feb 6, 2026

Upper · Passed

Taxation Do Pass Amended , Passed, YEAS 3, NAYS 4 S.J. 11

upper

Feb 6, 2026

Introduced

Taxation Motion to amend , Passed, S.J. 10 Amendment 118B

upper

Jan 26, 2026

Introduced

First read in Senate and referred to Senate Taxation S.J. 112

upper

8 primary · 0 co-sponsors