Pierre, SD — South Dakota lawmakers have authorized the construction of a new $650 million men’s prison in Sioux Falls, marking the most expensive state-funded project in South Dakota history. The 1,500-bed facility will replace the oldest parts of the penitentiary complex that have stood since before South Dakota achieved statehood.
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The decision came after a day-long special legislative session on Sept. 23, where both chambers narrowly secured the two-thirds majorities required to approve major spending bills. The Senate passed the plan 24-11 in the afternoon, followed by a 51-18 House vote in the evening, exceeding the constitutional threshold by four votes.
Shortly after the House vote, Gov. Larry Rhoden signed the measure into law at the Capitol. “As we started counting noses, it was closer than I really thought it would be,” Rhoden said. “So we got busy, and we didn’t leave any stone unturned.”
Calling it “a great day,” Rhoden celebrated the approval but acknowledged the uncertainty that lingered until the final votes. He immediately followed the bill signing with an executive order establishing a Correctional Rehabilitation Task Force, to be led by Lt. Gov. Tony Venhuizen. The group will include legislators, judges, law enforcement, Native American representatives, and health experts, tasked with studying treatment options, culturally specific programming, faith-based rehabilitation, and re-entry initiatives.
The new prison will be built on the Benson Road site in northeast Sioux Falls, about three miles from the existing penitentiary known as “the Hill” for its perch above the Big Sioux River. The location avoids the controversy that derailed an earlier $825 million proposal in Lincoln County earlier this year.
The revised design trims costs by $175 million compared to that plan, largely by shrinking common areas and designing 300 beds in a barracks-style format, while maintaining programming and vocational training spaces. Two newer units at the existing penitentiary will remain operational even after the new facility opens, which is projected for 2029.
Several lawmakers who opposed the Lincoln County proposal switched to support the Sioux Falls plan. House Majority Leader Scott Odenbach, R-Spearfish, a member of the prison task force, argued that the new proposal addressed key concerns about cost, location, size, and rehabilitation programming space.
“Friends, if you didn’t like the old prison plan, basically you got everything you wanted. And I would say take the win,” Odenbach said.
Still, skepticism remained. House Speaker Pro Tempore Karla Lems, R-Canton, opposed the bill, warning that building the facility before finalizing leadership at the Department of Corrections or broader recidivism strategies was premature. “We’re going forward without a completed plan, and without somebody in place at the Department of Corrections that has a great resume, that has a history of knowing how to reduce recidivism,” Lems said.
The prison will be funded largely with cash set aside by lawmakers in 2022, when South Dakota began directing excess revenues and federal pandemic dollars into an incarceration construction fund. Interest earnings and additional reserves will bring the fund to the required $650 million.
While most lawmakers praised the pay-as-you-go approach, some raised concerns about relying on future interest. Sen. John Carley, R-Piedmont, cautioned, “I get very concerned hearing that we have the cash on hand. We don’t.”
Rep. Liz May, R-Kyle, who had opposed the Lincoln County plan, said she voted yes this time because the state had saved responsibly. “I expect everybody in here to do their job, to watch the money,” she said. “Bring your policy bills next year. You’ll have support.”
The Department of Corrections estimates the new prison will cost up to $17–20 million more per year to operate. Venhuizen said those costs could be offset if rehabilitation initiatives keep people from returning to prison. “If that is successful, we will save money. Every person who’s not in that prison saves us $40,000 a year,” he said.
The women’s prison already under construction in Rapid City at a cost of $87 million reflects a broader overhaul of South Dakota’s corrections system. Lawmakers and task force members say the Sioux Falls project is not only about replacing outdated infrastructure but also about ensuring safer conditions, better programming, and a long-term approach to rehabilitation.
Originally reported by John Hult in South Dakota Saerch Light.
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