Each year, the state government compiles a report on active TIF districts across South Dakota. For the most recently tallied year, 2024, there were 264 of the often-controversial districts.
TIF, or tax increment finance districts are often a medium for funding business interests, but they’re also used to build housing, local infrastructure and support large industrial manufacturers using taxpayer dollars.
Some, like Elevate Rapid City CEO Tim Johnson say they’re critical to growing a community. He spoke at a recent city council meeting.
"The only tool you have to do economic development, to build infrastructure as it grows, is TIFs," Johnson said. "If you decide to take that away, then you really will have bad infrastructure, you really will have bad homes, and you’ll start to lose people.”
Data from the most recent state TIF report found affordable housing to be used much less widely than other types of TIF districts. However, that has started to change in the last five years.
Most TIF districts are used to support business interests. Between 2015 and 2017, 34 were “economic” TIFs while none were put into place for housing purposes.
Since 2020, that number has risen to 68 economic TIFs across the state. At the same time, fewer than half as many have been dedicated to affordable housing for South Dakotans.
Ussing tax dollars to bolster business development leads some, like Republican Representative Taffy Howard, to oppose the mechanism.
“Taxpayers will be subsidizing a private development,” Howard said in that same Rapid City council meeting.
Ultimately, the TIF in question for a Rapid City theme park was put on the ballot by a successful petition effort.
Counties with the most TIF districts show the same focus on economic based projects. In Pennington and Minnehaha Counties—the state’s two most populous counties - there are 32 business TIFS, compared to just 18 for any other type.
Other counties with the most TIF districts in the state include Davison, Brown, Codington and Brookings.
At the same time, the most frequently dissolved TIF districts are economic-oriented. Since 2018, there are zero reports of a housing-oriented TIF dissolving.
A TIF district “dissolves” after 20 years, or if the reimbursement of the project costs is met within that 20-year window. Yearly, the report estimates 8-16 TIF districts will complete their lifecycles across the state for the next several years.
The entirety of the 271-page report, consisting of local TIF district data, can be found here.