Gov. Larry Rhoden listens to a question at his first press conference of the 2026 legislative session on Jan. 15, 2026, at the South Dakota Capitol in Pierre. (Photo by Meghan O’Brien/South Dakota Searchlight)

PIERRE — The South Dakota governor should retain exclusive control over a pot of economic development money known as the Future Fund, a committee of lawmakers decided Monday at the Capitol. 

The Senate State Affairs Committee rejected a bill that would have subjected the fund to greater oversight, after an earlier tie vote left the measure in limbo.

The committee voted 4-4 earlier this month on a motion to send the bill to the full Senate, with Sen. Arch Beal, R-Sioux Falls, excused due to illness. On Monday, with Sen. Curt Voight, R-Rapid City, replacing Beal on the committee, the proposal was defeated 5-4.

The bill would have required Future Fund awards to be approved by a majority vote of the governor-appointed Board of Economic Development, instead of the governor alone. It also would have directed the Governor’s Office of Economic Development to write rules establishing an application process, methods of assessing economic impact, selection criteria, qualification requirements and procedures for disbursing awards.

Governor pledges transparency in funding decisions that lawmakers might vote to take away

The Future Fund receives money from a fee paid by employers. It has drawn scrutiny in recent years over uses by former Gov. Kristi Noem, including millions in spending for a shooting range that lawmakers declined to fund, a rodeo and an advertising campaign starring Noem. 

Some of the bill’s opponents said a few examples do not undermine the value of a governor-controlled fund, which is intended to give the governor flexibility to quickly respond to economic opportunities. 

“This is funded by the employers. Not every taxpayer in the state funds this,” said Sen. Randy Deibert, R-Spearfish. “And those groups that represent employers are soundly opposed to this.” 

Groups opposing the bill included the South Dakota Chamber of Commerce and Industry, and the South Dakota Retailers Association. 

Earlier this month, Gov. Larry Rhoden attempted to get ahead of the issue with an executive order laying out procedures for how Future Fund awards are handled. It self-imposes requirements for public posting of awards and agreements, while still preserving the governor’s sole authority over the fund. The order is not binding on future governors if they choose to operate the fund differently.

Meanwhile, another bill would increase the Governor’s Office of Economic Development’s reporting requirements for the Future Fund. That bill, from Rep. Erik Muckey, D-Sioux Falls, has not yet had a hearing.

The economic development office is already required to report minimal information about the Future Fund twice per year to the Legislature’s budget committee. Muckey’s bill would require additional information to be included in the reports, such as all awards made in the prior 20 years, the fund balance at the time of the report, and the status of the research or economic development purpose of the awards. The report would also add a list of other legislative committees required to receive the reports once per year.