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House passes bill to average owner-occupied assessments over eight years to blunt spikes

South Dakota House of Representatives · February 19, 2026

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Summary

HB 12-53 uses an eight-year "Olympic average" (dropping the highest and lowest values) for owner-occupied and certain nonag properties to smooth valuation spikes; sponsors expect assessment reductions approximating 2023 levels and fiscal staff indicated counties will see effects. The House passed the bill.

Representative Odenbach brought HB 12-53 to the floor as a property-tax relief measure that would change assessment methodology for owner-occupied and some nonagricultural properties by applying an "Olympic average" over eight years (dropping the single highest and single lowest assessed values and averaging the remainder) to calculate taxable valuation.

Odenbach said the change would moderate sudden valuation spikes that have driven up property-tax bills for many homeowners and offered technical details: a new purchase price starts a valuation series for new owners, and improvements below 40% of value would not reset the averaging period. He cited LRC fiscal analysis estimating an overall reduction toward 2023 levels and said the Department of Revenue acknowledged the bill would lower owner-occupied taxes even if it raised implementation concerns.

Opponents, including Representative Weems and others, warned that the proposal redistributes tax burden onto counties and other property classes because counties would be prevented from raising levies in some circumstances; they said county budgets and directors of equalization would face administrative burdens and that mill-levy adjustments could shift costs to renters and businesses. Testimony also addressed implementation complexity and whether reductions would be temporary as levies adjust. Supporters emphasized homeowner relief and stability.

After extended floor debate and questions, the House approved HB 12-53 by recorded vote (ayes 38, nays 29, excused 3). The bill's provisions include the averaging method, the 40% carve-out for improvements, and transitional valuation rules for recent purchases.