An orange excavator before a blue sky and a dirt mound.

South Dakota lawmakers clear path for $650M prison project

October 1, 2025

South Dakota lawmakers have passed a bill to spend $650 million to build a 1,500-bed men’s prison in Sioux Falls, replacing an operational facility that was built in 1885. 

The new prison is expected to alleviate overcrowding and an associated problems that include fights, drug smuggling and inmate deaths. 

Existing facilities will remain in use until the new prison is complete. Construction is expected to begin in 2026 and run through 2029. 

The prison will be built in northeast Sioux Falls on an undeveloped patch of industrial land near the Sioux Falls Area Humane Society. The location is about three miles northeast of the existing penitentiary. 

Proponents of the new prison have said that the additional space and modern design will be more conducive to rehabilitative programming, mental health support and work opportunities. 

A truth-in-sentencing bill that requires some violent offenders to serve the full length of their sentences before parole has contributed to South Dakota’s overcrowding problem. The state may need to spend up to $2 billion within the next decade to adequately handle the increasing inmate population, the report stated. 

The bill passed Tuesday transfers $78.7 million from the state’s budget reserves to the prison construction fund and authorizes the Department of Corrections to spend up to $650 million to build the new facility.  

Most of the money is already in the fund, but about $42 million of the required funding is expected to come from future interest earnings. 


Photo by Anamul Rezwan from Pexels

Miles Smith

Miles Smith has more than two decades of communications experience in the public and private sectors, including several years of covering local governments for various daily and weekly print publications. His scope of work includes handling public relations for large private-sector corporations and managing public-facing communications for local governments.

Smith has recently joined the team as a content writer for SPI’s news publications, which include Texas Government Insider, Government Contracting Pipeline and its newest digital product, Government Market News, which launched in September 2023. He graduated from Texas A&M University with a bachelor’s in journalism.

Don't Miss

Massive support, funding now available to improve supply-chain networks

New opportunities for multimodal freight, rail, and port projects are

New hospitals greenlit for Amarillo, Wichita Falls

The Texas Health and Human Services Commission (HHSC) is searching