South Dakota Senate Passes Data Center Bill of Rights

The South Dakota Senate passed Senate Bill 135, the Data Center Bill of Rights for Citizens, in a 34-0 vote on February 20, 2026. The legislation mandates that data center companies pay their own electricity costs and ensure their water usage does not overburden local resources. It also prohibits the state from overruling local government authority regarding data center ordinances.

Sponsor Representative Chris Karr removed language from the original draft that would have banned state and local tax exemptions for data centers. Karr indicated that the tax incentive language remains under review and could be reintroduced as the bill proceeds to a House committee.

During the same legislative period, lawmakers rejected two other data center-related proposals. The Senate defeated a bill that would have exempted large backup generators from Public Utilities Commission review, while the House of Representatives rejected a bill that would have banned nondisclosure agreements for data center projects.