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State of South Dakota
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EIGHTY-SEVENTH SESSION
LEGISLATIVE ASSEMBLY, 2012
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690T0665
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HOUSE BILL NO. 1240
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Introduced by: Representatives Sigdestad, Brunner, Dennert, Feickert, Hoffman, Olson
(Betty), Russell, Schaefer, Street, and Verchio and Senators Rhoden, Begalka,
Frerichs, Hundstad, Lederman, Maher, and Vehle
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FOR AN ACT ENTITLED, An Act to separately classify, assess, and tax agricultural land that
is leased for certain purposes that restrict the use of the land.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:
Section 1. That chapter 10-6 be amended by adding thereto a NEW SECTION to read as
follows:
Any agricultural land which is under a perpetual or longterm lease with any federal or state
agency or a nonprofit entity that limits the use of land for noncropland purposes is hereby
separately classified. For the purposes of this section, the term, longterm lease, means any lease
that extends for twenty or more years. The director of equalization shall assess the land based
on its actual use and its highest and best use and determine the agricultural income value of the
land pursuant to §§ 10-6-33.28 to 10-6-33.33, inclusive, for each use.
If the land has not been separately classified pursuant to this section and the land meets such
criteria, the owner may request the director of equalization before August first to specifically
classify the land pursuant to this section. If the director of equalization determines that such land
meets the criteria provided by this section, the director of equalization shall assess the land as
provided by this Act. An aggrieved person may appeal the decision of the director pursuant to
chapter 1-26D. The director shall act upon the owner's request within thirty days of the date of
the request.
Section 2. That chapter 10-6 be amended by adding thereto a NEW SECTION to read as
follows:
The owner of any agricultural land that is classified pursuant to section 1 of this Act shall
be assessed, equalized, and taxed based on the valuation determined for its actual use. The
leaseholder, except any federal agency, of any agricultural land that is classified pursuant to
section 1 of this Act shall be assessed, equalized, and taxed based on the valuation that results
by subtracting the actual use valuation of the land from the highest and best use valuation of the
land.
If the leaseholder is a federal agency, the federal agency shall be requested to make a
payment in lieu of taxes.