South Dakota Governor Signs Bill For More Gambling Tax Revenue For Deadwood
South Dakota Governor Larry Rhoden, a Republican, has signed three new laws aimed at restructuring the economy by addressing tax policy, the business environment, and municipal funding.
The new legislation, which Governor Rhoden described as "essential to his 'open for opportunity' initiative," is set to take effect on July 1.
Among the key changes is a new allocation of gambling tax revenue in Deadwood, the only non-tribal municipality in South Dakota where casino gambling is permitted.
The revised system ensures a greater share of tax revenue is directed toward local infrastructure, tourism, and historic preservation in the city.
Deadwood To Receive Larger Share Of Gaming Revenue
According to supporters, the changes will enhance local decision-making and ensure that revenue generated in Deadwood benefits the surrounding community while supporting regional economic growth.
The new law removes the previous $6.8 million cap on allocations to Deadwood and directs a larger portion of revenue toward historic preservation.
Smaller shares will go to the state’s general fund, other towns in Lawrence County, and the Lead-Deadwood School District.
Local leaders have backed the measure, arguing it is essential for funding critical infrastructure in the historic Black Hills city.
Officials estimate Deadwood would have received an additional $160,000 last year under the new system.
“South Dakota’s new laws signal a shift toward local control and flexible funding, balancing economic development with public health concerns as the state reshapes its tax and gaming landscape.”
Tobacco Licensing And Temporary Tax Powers Expand
The second bill expands the state’s tobacco licensing system, allowing counties and cities to issue new licenses for cigar bars.
South Dakota voters approved a statewide smoking ban more than a decade ago, later extended to include vaping.
Previously, only three cigar bars operating before the ban were permitted to continue under strict ventilation rules.
Critics argue that expanding licenses undermines the intent of the original public health legislation.
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The third bill allows cities to temporarily increase sales tax by up to 1% to fund major projects.
The tax requires at least 60% voter approval through a public referendum and will expire once funding goals are met or after five years.
Cities must also wait two years before proposing a similar tax again.
According to the governor’s office, the measure provides municipalities with flexibility while encouraging responsible long-term planning.
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