The bill amends South Dakota law regarding tax increment financing (TIF) districts, focusing on the assessment and valuation processes for properties within these districts. It establishes that the valuation of newly constructed structures for taxation must follow standard procedures, allowing county commissioners to adopt a formula for assessed value that is not applicable to TIF district properties. The bill also clarifies that partially constructed structures on the assessment date can be valued accordingly and specifies the types of properties eligible for certain tax classifications, including new industrial, commercial, and residential structures.

Additionally, the bill introduces new requirements for the establishment of TIF districts, mandating an independent fiscal feasibility review by a registered municipal advisor for any district created after July 1, 2026. It defines key terms related to TIF districts, such as "project costs" and "tax increment valuation," and stipulates that a district will terminate when positive tax increments are no longer allocable or if the governing body dissolves the district. The bill aims to enhance transparency and accountability in TIF district management, ensuring thorough financial assessments before new districts are approved. It also outlines the content required in the fiscal feasibility review and mandates its availability to the governing body and the public prior to consideration of the district establishment.

Statutes affected:
Introduced, 02/04/2026: 10-6-137, 10-12-44, 11-9-1, 11-9-4, 11-9-5, 11-9-6, 11-9-14, 11-9-15, 11-9-46