All roads lead to Pierre: Ahlers and Rhoden face off for South Dakota’s top office

As South Dakotans prepare to vote on Nov. 3, Governor Larry Rhoden faces Democratic hopeful Dan Ahlers. This guide compares their policy positions using statements from the gubernatorial debate, interviews and Ahlers’ written responses to the Mirror. Rhoden’s campaign did not respond to the Mirror as of publication.

Data centers

Ahlers said communities should have a greater voice in whether data centers are built nearby, arguing that companies have promised not to strain local resources but have not kept those promises in other states, like North Dakota or North Carolina. He said the state should do more to eliminate eminent domain as an option, pointing to its use in the carbon dioxide pipeline proposals and by oil pipelines and other companies. Ahlers said that power should be taken away from private companies and reserved for public utilities.

Rhoden said he supports economic development but data centers merit a “purposeful conversation” and the state should respect local governments’ decisions. Last year, He signed a data center bill of rights that he said addresses water consumption and power usage, which he called the “big Kahuna.” Developers must show they have sufficient energy to run a facility without affecting existing ratepayers, a policy he described as “bring your own power.” Rhoden also tied the issue to national security, saying the state should keep foreign governments such as China from owning data produced in America.

Taxes and affordability

Ahlers called the property tax cuts passed this year — which rely on sales tax revenue — a tax shift that he said leaves renters without relief while they face higher costs through their landlords and more sales tax. He said the state should change how homes are assessed so they are not treated like commodities. Ahlers also said that fully funding K-12 education under state law would lower local property taxes and proposed state-funded school lunches, which he said would save families $800 per child. He backs a childcare tax credit and a per-child rebate but has not given an amount. On housing, he wants to expand the Governor’s House program, which sells affordable homes built by prison inmates, and work with builders to create affordable neighborhoods.

Rhoden said Senate Bill 245 and a second, optional county-level bill combine to cut homeowner property taxes by an average of 34% statewide, the largest cut in state history. He disputed the tax shift criticism, saying both bills are property tax relief. Senate Bill 245, which he signed March 30 this year, redirects revenue from a scheduled increase in the state sales tax rate from 4.2% to 4.5% into a fund that lowers school levies on owner-occupied homes. Rhoden said this  alone amounts to about a 15% cut in homeowner property taxes.

Economic development

Ahlers called for more transparency and accountability in the state’s Future Fund. He criticized a $69 million incentive to CJ Schwan’s a company he said pays $18 an hour and argued the state should instead back local entrepreneurs. As an example, he cited a hemp farmer who he said is building a $3 million hempcrete factory in Iowa because South Dakota offered no incentives. For agriculture, he proposed more meat and dairy processing and low-interest loans for young farmers.

Rhoden said an executive order, followed by legislation, spelled out how the Future Fund may be used. He pointed to a $500 million Great Plains processing project in Mitchell and a $1.3 billion Smithfield project in Sioux Falls as two of the state’s largest economic development projects. Value-added agriculture is key, he said, and family farms hold 97% of the state’s agricultural land. Rhoden also promoted national security as a growth industry, including the planned arrival of the B-21 bomber at Ellsworth Air Force Base. 

Education

Ahlers said retaining teachers is the biggest challenge. He said the Legislature stripped language dedicating the 2016 half-cent sales tax increase to teacher pay, technical schools and property tax relief the following year. He said in the past two years the state has funded schools at half the statutory requirement despite surpluses of $63 million and $69 million. In his written response to the Mirror, he called colleges and universities a key talent pipeline and said he would support increasing the state’s Opportunity Scholarship and Build Dakota Scholarship.

Rhoden said the biggest challenge every year is funding. Over the past eight years, he said, education funding has run 7.6% above what state law required, and last year was the first in which Medicaid spending exceeded K-12 funding. He said teacher salaries have risen by about $10,000 in recent years, citing legislation that required added school funding go toward pay. Rhoden has also backed technical education, including $6 million in state money for Southeast Technical College.

Healthcare

Ahlers said healthcare access is the top issue, citing the loss of rural obstetric services. He wants higher Medicaid reimbursement rates, saying low payments have forced facilities to close and some families to seek out-of-state care, and opposes Amendment I, a ballot measure that would end expanded Medicaid coverage if federal funding falls below 90%. He said the 2025 federal tax and spending law cut an estimated $931 million in Medicaid funding over 10 years and $147 million in rural health care funding in South Dakota, which he said a $189 million rural health block grant cannot offset. He also proposed using Governor’s Houses to give rural clinics and hospitals housing for recruits.

Rhoden said the federal Rural Health Transformation program will have a large effect. He said South Dakota received $189 million for 2026 and expects as much as $1 billion over five years. He also  said the state has invested more than $350 million in rural high-speed internet and supports making in-home care easier for families as nursing homes close.

Prisons and corrections

Ahlers said programming in prisons has declined since he served in the Legislature. He wants a comprehensive re-entry program, including drug treatment, job training, education and help obtaining documents such as birth certificates and Social Security cards, noting that about 80% of inmates have drug or alcohol offenses. He said the state should have built a new penitentiary in 2010 and faulted what he described as staffing turnover,  safety problems and deaths. 

Rhoden highlighted the new women’s prison in Rapid City has opened with six hours of daily drug treatment programming for 96 inmates, noting that about 90 are there on drug charges. He said construction has begun on a new men’s prison in Sioux Falls and that a rehabilitation task force he created is preparing programming for when it opens in about three years. Rhoden attributed high recidivism partly to cramped facilities that left no room for programs. He said his administration has also addressed problems with parolees, including meeting with local law enforcement.