SIOUX FALLS, S.D. (KELO) – Mayor Paul TenHaken announced $6 million in cuts to the city’s 2026 budget. These cuts will impact pools, libraries, school clinics and more.
TenHaken said the city needs to be cutting $8 to $10 million from its annual budget in the next three years. During the last legislative session, Senate Bill 216 passed, which caps residential property taxes.
“We have to reduce services to make up the $8 to $10 million,” TenHaken said in a news conference Thursday. “There’s no solutions, only tradeoffs.”
The city is expecting a $25 million loss in revenue over the next 10 years because of the bill, which TenHaken said is meant to stifle growth.
TenHaken called the cuts “the best of the worst.”
The first area impacted is snow removal. The city will phase out contracted work and will only use city owned and operated equipment for snow removal. TenHaken says this could lead to longer snow clearing times.
“It wouldn’t affect the quality of how we do snow removal,” he said. “We’ll still do the curb to curb and snow plowing, but it could result in slightly longer snow clearing times.”
The Sioux Falls and Brandon Siouxland Library branches will be adjusting their hours of operation to cut back on costs.
TenHaken said locations will be opening an hour later and closing an hour earlier. Right now, the downtown library is open from 9 a.m. to 8 p.m. Monday through Thursday, until 6 p.m. on Fridays and 5 p.m. on Saturdays. The library is open from 1-5 p.m. on Sundays.
The school-based health clinics located in three Sioux Falls Elementary schools will also be closing.
“We don’t see a lot of kids, actually, in those school based clinics, so we’ve decided to close those as a cost saving measure,” TenHaken said.
Less than 5% of patients at those clinics are kids, he added. The three clinics are located in Terry Redlin, Hawthorne and Hayward Elementary.
Next year, outdoor pools will close the first weekend in August.
“We see roughly almost a 70% drop in attendance after the first weekend in August in all of our outdoor pools and we see a loss in staff,” TenHaken said.
Any non-refrigerated, outdoor ice skating rinks will also be shut down starting next year.
“Unreliable operating days and the weather is increasingly challenging to keep ice on those,” the mayor said. “The cost per attendee honestly can range anywhere from 30 bucks an attendee to 170 bucks an attendee just to keep those rinks going. So we’re going to be phasing those out.”
The outdoor rinks at Campus, Frank Olson, McKennan, Memorial, Sherman and Tuthill Park will all eventually close. The new refrigerated ice ribbon at Jacobson Plaza will stay open.
The city will also be scaling back the amount of money given to nonprofits in Sioux Falls. Nonprofit funding specifically could see a 30% reduction. The city currently helps fund organizations like the Bishop Dudley House, Helpline Center, multicultural center and after school programs.
TenHaken said the city wanted to avoid raising fees on taxpayers. He also acknowledged state lawmakers felt pressure from people across the state to lower property taxes. He argued the property tax cuts should’ve been more targeted.
“I feel that the need for the reform really needs to fall where it’s needed most, which is those on fixed incomes, seniors,” he said. “It needs to be much more targeted than the blanket approach that we’re taking now.”
TenHaken said the city will hold budget hearings in the coming months to finalize some of the cuts.
He said the city will eliminate four staff positions, including one staff position in the mayor’s office.
“We’ll focus on reducing overtime,” TenHaken said.
TenHaken said that’s just a “handful” of the cuts that will come after the budget process.
“It’s hard because of the rate we’re growing,” TenHaken said. “This is Sioux Falls approach to this.”
In a news release, the city said: “The changes are necessary due to Senate Bill 216, which was passed by the South Dakota State Legislature earlier this year. The bill caps property tax growth for municipalities, counties and school districts, resulting in a permanent revenue reduction from property taxes for the city of Sioux Falls.”
In a news release from Gov. Larry Rhoden’s office on June 30 celebrating SB 216, Rhoden called it “a big win for South Dakota homeowners.”
“It is impactful and workable, and it will certainly slow down any future tax increases,” Rhoden said in a news release. “I am grateful for the legislators who worked with me and engaged in meaningful discussions along the way. Everyone pulled their weight in order to get this important bill passed.”
