State Lawmakers Cracker Barrel on Data Centers, Tax Relief, and AI at 39th Annual Watertown Home Show
- Steve Jurrens
- 4 days ago
- 4 min read
Northeast Radio SD News – Watertown, SD - Against the backdrop of the 39th Annual Watertown Home Show, local residents gathered for a high-stakes “Cracker Barrel” legislative Session hosted by the Watertown Area Home Builders Association.
Moderated by Mike Tanner, News Director at Watertown Radio (KWAT), the event featured a panel of District 4 and 5 representatives who engaged in a candid and often spirited debate over the state’s economic future, the complexities of property tax relief, and the encroaching influence of artificial intelligence.
The panel consisted of Senator Glen Vilhauer (District 5), Representative Matt Roby (District 5), Representative Kent Roe (District 4), State Senator Stephanie Sauder (District 4), and Representative Dylan Jordan (District 4). District 5’s Josephine Garcia was notably absent from the proceedings.
The Data Center Dilemma: Opportunity vs. Oversight
The Session opened with a discussion regarding the legislative focus on data centers during the recent Session. The discussion underscored a fundamental divide: the desire to attract high-tech industry versus the need to protect local resources and taxpayer interests.
Senator Glen Vilhauer expressed disappointment over the defeat of specific tax incentives, arguing that South Dakota is falling behind its neighbors. “I’ve been a supporter of data centers. I think there’s a world of difference between the carbon pipeline that was proposed... and the data center issue,” Vilhauer remarked. “I feel like we’re turning our back on some prime opportunities. I think the legislation... would have actually expanded a program already in place... we’re missing a prime opportunity there as far as property tax revenue that could have been generated.”
Representative Kent Roe echoed this sentiment, pointing to the competitive disadvantage South Dakota faces. "We’ve got a high tax on technology in this state... every neighboring state has tax loads that are much lower than South Dakota’s. That’s why we’re being overlooked,” Roe stated. He highlighted that North Dakota is currently seeing massive load growth that could equate to “$100 million in sales tax we’re not getting every year here in South Dakota.”
However, Representative Matt Roby emphasized the importance of the “Data Center Citizens’ Bill of Rights” that passed, which focuses on protecting current users. “Whether or not they come here... we want to make sure they’re paying their own freight, that they’re not going to pass on rising electricity costs to current users, and that they’re not going to jeopardize water resources,” Roby explained.
Senator Stephanie Sauder raised a global security concern. “China wants these data centers. Why would we want to put our personal data in China? That’s what scares me,” Sauder warned, adding that keeping them in South Dakota alleviates her national security concerns.
Property Tax Relief: A “Shell Game” of Shifting Burdens?
The most complex topic of the morning was property tax relief. Lawmakers dissected Senate Bill 96, which allows counties to implement a half-penny sales tax, and Senate Bill 245, which involves a complex shift in state sales tax rates.
Representative Dylan Jordan criticized the approach, calling it a tax shift rather than a true cut. "You notice everyone says ‘property tax relief,’ not ‘tax relief.’ What you’re doing is saying [you pay less] on property taxes, but you’re paying more at Walmart,” Jordan noted. “All we did was raise sales tax to pay for property tax, which I’m against.”
Senator Sauder admitted the process felt like a “shell game” and explained her “no” vote on SB 245, noting that the current tax’s sunset doesn’t occur until next year, allowing more time for discussion. She did, however, support SB 96 as a “local tool” for counties to decide for themselves.
Senator Vilhauer also voted against SB 245, citing concerns over the state’s “Big Three”—teachers, county workers, and care providers. “One hundred and ten million dollars in state revenue would have gone a long way to provide for our Big Three,” Vilhauer argued. He also expressed concern that the relief provided by the bill would primarily benefit “those that have higher-valued properties.”
Budgetary Priorities: Funding the “Big Three”
The state’s $7.5 billion budget for fiscal year 2027 also came under scrutiny. While the budget includes a 2.4% increase, some representatives were wary of the growing size of state government.
Representative Jordan, a “no” vote on the main budget bill (the “G-Bill”), pointed out that state spending increased significantly this year, adding 26 full-time employees. Representative Roe, however, defended the work of the appropriations committee, stating, “We’ve got good people working in the appropriations committee... I trust that work they’re doing.”
Senator Sauder praised the diligence of the committee members, specifically Senator Vilhauer, calling the process “rockstar” level work despite the tight 1.4% increase originally proposed.
The Future of Technology: AI, Crypto, and Education
As the Session wound down, the panel tackled emerging issues like cryptocurrency and Artificial Intelligence.
“AI is a tool... it all depends on what you use it for,” Representative Jordan remarked. Representative Roe admitted he uses AI frequently but warned of its disruptive potential. “It’s going to replace my work someday, same as it will Glen’s and maybe even Matt’s,” Roe joked, though he advocated for a “light touch” when it comes to regulation.
The discussion even touched on a bill to ban cell phones in classrooms. Representative Jordan argued that phones are a vital tool for accountability, allowing students to record “indoctrination and gender ideology” in classrooms elsewhere in the country.
Senator Sauder, drawing on her background as a teacher, supported the idea of a ban, noting the significant “refocus time” required after a phone distraction, but ultimately agreed it should be a local school board decision.
Final Grades: How Did the Legislature Fare?
To close the Session, Mike Tanner asked the panel to grade the legislature’s work this year:
· Senator Sauder: Initially a B-, then moved it to a B.
· Representative Jordan: C (due to the lack of true tax cuts and high spending).
· Senator Vilhauer: B to B- (noting they played “good defense” against many bad bills).
· Representative Roby: B/B+.
· Representative Roe: B on performance, but an A++ on “bill volume.”
The 39th Annual Home Show Cracker Barrel highlighted the balancing act South Dakota lawmakers face as they navigate property taxes, industrial growth, and the rapid evolution of technology.
You can search bills at the following link - https://sdlegislature.gov/Session/Bills/71
