South Dakota Lawmakers Advance Education Funding Bills

Proposals aim to make it easier to refer school tax increases and set a minimum funding increase

Feb. 9, 2026 at 7:31pm

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The South Dakota Senate State Affairs Committee passed a bill that would lower the signature threshold and extend the time period to refer school district 'opt-out' decisions to raise property taxes to a public vote. Separately, the House Education Committee advanced a bill that would require state education funding increases to match or exceed inflation, with a 3% floor.

Why it matters

These bills reflect ongoing debates in South Dakota over school funding, property taxes, and the balance of power between state lawmakers, local school boards, and voters. The proposals aim to give residents more direct say over tax increases while also ensuring education budgets keep pace with rising costs.

The details

Senate Bill 223 would lower the number of petition signatures needed to refer a school district's decision to exceed property tax limits to a public vote, from 5% of registered voters to 5% of the last school board election's turnout or 50 signatures, whichever is greater. It would also extend the signature gathering period from 20 to 40 days. The House Education Committee advanced a separate bill, introduced by Rep. Nicole Uhre-Balk, that would require state education funding increases to match or exceed inflation, with a 3% floor, rather than the current law which sets 3% or inflation as the maximum increase.

  • On Monday, the Senate State Affairs Committee passed SB 223 in a 6-3 vote.
  • Also on Monday, the House Education Committee voted 8-6 to advance the school funding increase bill to the House Appropriations Committee.

The players

Sen. Sue Peterson

The Sioux Falls Republican introduced SB 223 to make it easier to refer school district tax increases to voters.

Rep. Nicole Uhre-Balk

The Rapid City Democrat introduced the bill to set a 3% floor for annual state education funding increases.

Sioux Falls School Board

Opposed the bill to lower the signature threshold for referrals, arguing it would erode the purpose of electing school board members.

Rapid City School Board

Also opposed the bill to lower the signature threshold for referrals.

Grant Judson

An official with the state Bureau of Finance and Management, who told lawmakers the 3% funding floor bill would "create an expectation we can't guarantee" due to annual budget changes.

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What they’re saying

“The referral process is meant to ensure that citizens are part of the process, not excluded from it.”

— Sen. Sue Peterson

“Keeping the law the way it is now will guarantee cuts to education that will never keep up with inflation and will always underfund our ability to keep up with target teacher pay.”

— Rep. Nicole Uhre-Balk

“The change would 'create an expectation we can't guarantee' because funding changes each year based on revenues.”

— Grant Judson, Official, State Bureau of Finance and Management

What’s next

The school tax referral bill (SB 223) now heads to the full South Dakota Senate for consideration, while the education funding increase bill (introduced by Rep. Uhre-Balk) will next be taken up by the House Appropriations Committee.

The takeaway

These competing education funding proposals reflect the ongoing debate in South Dakota over the balance of power between state lawmakers, local school boards, and voters when it comes to setting school budgets and property tax levels. The outcome could have significant implications for how education is funded in the state going forward.