Appropriations committee refers $825 million corrections construction bill to floor after heavy testimony

House Bill 1025 asks the Legislature to authorize construction of a new, multi‑custody men's correctional facility in Lincoln County and to transfer up to $763 million in spending authority from the Incarceration Construction Fund; the bill also proposes a one‑time transfer of $182 million (split between general fund and budget reserve) into that fund to fully finance the project.

Why it matters: The measure is the largest single capital proposal heard by joint appropriations during the session. If enacted, it will direct major one‑time state resources and shape corrections capacity, county jail pressures and treatment programming for years.

Sponsor and DOC position: Ryan Bruner (Governor’s office) and Secretary Kelly Wasco (Department of Corrections) told the committee the existing South Dakota State Penitentiary is unsafe and overcrowded and lacks adequate space for modern rehabilitation programming. They said a multi‑custody facility near Sioux Falls (on state‑owned land in Lincoln County) is consistent with prior DLR Group studies and a 2022 legislative summer study that prioritized a new men’s facility and a new women’s facility in Rapid City (the Rapid City women’s facility is already under construction). Secretary Wasco said the design work is complete and the construction guaranteed maximum price (GMP) for construction is $737 million, producing a total project cost estimate of $825 million when site infrastructure, commissioning, furniture and other costs are included.

Funding and timeline: Brittany Skipper (DOC finance) explained the bill would rely principally on the Incarceration Construction Fund (ICF), which already holds approximately $567 million in deposits. The bill asks for a one‑time transfer of $182 million (a blend of general fund and budget reserve amounts) to make the fund whole and fully finance the project under the GMP. Skipper warned that the GMP has a March 31 expiration and explained that construction-cost inflation would increase the price materially if the project is delayed.

Contracting and procurement: The construction manager‑at‑risk team, a JE Dunn/Henry Carlson joint venture, testified they based the GMP on local bids and vendor commitments and said roughly 70% of trade packages already have firm pricing or local commitments. The contractors described their experience with corrections projects and said the GMP is defensible based on local pricing and packages already bid.

Opposition and concerns: Opponents — including former legislators, county residents, corrections critics and local business owners — urged caution. Opponents argued the state should prioritize hiring and programming (to reduce recidivism) rather than constructing an expensive new facility; some warned of duplication of services, questioned the procurement process (one witness noted only one design-bid respondent to an RFQ) and pointed to pending legal challenges by nearby landowners over permitting. Opponents also raised concerns that the new site lacks existing industrial infrastructure (power substation, water main, etc.), which increases upfront utility costs. The Office of the State Engineer listed an inventory of additional repairs and deferred maintenance that would be required across the existing campus if the new facility is not built.

Committee action: After extended testimony and questioning, the joint appropriations committee voted to refer HB 1025 to the House floor WITHOUT RECOMMENDATION so the full legislature could debate the bill and decide the policy and funding tradeoffs.

Ending: With the bill on the chamber floor, the full legislature will have the opportunity to hear the full record, weigh the tradeoffs between capital spending and programmatic investments (staffing, in‑custody treatment and probation), and decide whether to adopt the proposed funding transfers and project authorization.