PIERRE, S.D. (Makenzie Huber / South Dakota Searchlight) – South Dakota must spend $106 million in remaining pandemic relief by the end of the year, or it has to be returned to the federal government.
Most of the funds left to spend are for water and wastewater infrastructure projects, housing, broadband, ambulance upgrades and telemedicine upgrades in nursing homes, according to a Wednesday presentation from the Bureau of Finance and Management at the Capitol in Pierre.
Bureau Commissioner Jim Terwilliger told lawmakers on the budget committee that the state will meet the deadline to “maximize those dollars.”
“We feel like we’re in a good place,” Terwilliger said.
Federal relief and stimulus funding for South Dakota in response to the COVID-19 pandemic included about $974 million from the State Fiscal Recovery Funds authorized by the American Rescue Plan Act of 2021. The unspent balance represents about 10% of that funding.
The funding has been transformative in some sectors of the state. South Dakota Department of Agriculture and Natural Resources Secretary Hunter Roberts said during the last legislative session the influx of cash sparked an overdue “water renaissance.”
Roberts’ department has $75 million left to spend on water and sewer projects. Some projects that have used ARPA funding so far include upgrades for the Mni Waste Water Company in western South Dakota, a regional waterline upgrade for the Randall Community Water District in eastern South Dakota, and funding for the Western Dakota Regional Water System study.
The bureau receives quarterly department reports for how funding is spent. As the end of 2026 approaches, any unspent funds will be reallocated to water projects.
About $14 million for workforce housing projects, which is roughly a quarter of that program’s ARPA funding, has not been spent. A mix of federal and state funding was approved by lawmakers in 2022 to help increase South Dakota’s housing stock as the state’s population grows. Roughly $64 million in state-funded loans for workforce housing also remain unobligated, with Gov. Larry Rhoden proposing those state funds be shifted to airport improvement projects, and a legislative task force recommending the money be used for property tax credits.
About $4 million, which is nearly half of the ARPA funding meant to improve emergency medical services across the state, has not been spent, according to the presentation. About $2 million, which is three-quarters of the ARPA funding promised to nursing home telemedicine upgrades, hasn’t been spent yet either. Both grant programs are under the state Department of Health.
