South Dakota board advances rules allowing $30 million in airport loans from housing fund

A South Dakota board advanced rules on Wednesday that allow up to $30 million to be loaned from a state housing infrastructure fund to help finance airport projects in Rapid City and Sioux Falls.

The Housing Development Authority’s members approved the rules without any opposition. The rules implement a bill introduced at Gov. Larry Rhoden’s request and signed into law by him in March. 

The law authorizes loans up to $15 million each to the state’s two largest commercial airports. The loans would carry 2% interest rates with repayment periods of 20 years. Repayments and interest must be returned to the housing fund to support future housing infrastructure projects. 

Governor’s approval opens South Dakota housing loan fund to big-city airport projects

Rapid City plans a concourse expansion adding five gates and more passenger space. Sioux Falls is building a new concourse that will provide up to five additional aircraft gates and 57,000 square feet of seating and circulation space. The projects are expected to cost more than $100 million apiece. 

The Legislature and former Gov. Kristi Noem created the housing fund and program in 2023 with $200 million: $100 million for grants and $100 million for loans to support streets, sewer, water, and other infrastructure needed for housing developments. The package used $150 million in state money and $50 million in federal American Rescue Plan funds.  

By late 2025, about $65 million remained on the loan side. The program has helped finance 87 projects expected to produce 7,464 single-family lots and 5,882 multifamily units.  

The housing board’s rule change now goes to the Legislature’s Interim Rules Review Committee.