South Dakota’s Proposed Soda Ban for Food Stamps Faces Financial and Logistical Challenges
SOUTH DAKOTA – In a pivotal move to refine nutritional aid programs, South Dakota’s legislature is deliberating House Bill 1056—an initiative aiming to prohibit the use of Supplemental Nutrition Assistance Program (SNAP) benefits for purchasing sugary sodas. This measure, identified as a soda ban, could reshape the way food assistance is implemented, yet it signals considerable costs and operational hurdles for the state.
Larry Rhoden
The House Bill 1056 proposal posits an ambitious venture to curtail the consumption of sugary beverages among SNAP recipients, reflecting an increasing concern over public health issues linked to excessive soda consumption, such as obesity, diabetes, and dental problems. However, the South Dakota Legislative Research Council released a fiscal impact statement estimating the state would incur an initial cost of $310,000 over the first two years and $248,000 annually afterward. These financial implications have fueled debates among state officials and stakeholders. Governor Larry Rhoden, whose office has voiced opposition to the bill, highlighted the substantial costs related to the administration and execution of these new restrictions.
Governor Rhoden emphasized the financial burden on the state, contending that the federal government should instigate a universal policy rather than leaving states to navigate costly individual waivers. He stated, “Why would we as a state take on responsibility that costs hundreds of thousands of dollars to administer a federal program?”
The bill’s sponsor, Sioux Falls Republican Representative Taylor Rehfeldt, argues that implementing the soda purchase ban is a long-term investment in public health that could lead to reductions in Medicaid expenses, offsetting initial administrative costs. “States pursuing similar waivers that have had no or minimal cost include Nebraska, Oklahoma, Iowa, West Virginia, Texas, and Idaho,” Rehfeldt assured the Senate Health and Human Services Committee.
Proponents of the bill argue for its potential health benefits, while opponents, including retailers and grocers, remain concerned about the complexity and expense of distinguishing products eligible for SNAP benefits. Nathan Sanderson of the South Dakota Retailers Association pointed out the logistical complications of constantly updating product databases as new beverage varieties emerge.
The evolution of consumer offerings complicates execution further, with an ever-changing array of sodas entering the market, each necessitating a unique UPC code for tracking. Sanderson argues, “This is not like flipping a switch,” underscoring the ongoing challenge this bill presents for retail management and compliance.
Kevin Jensen
To enforce such a policy, it’s projected that the Department of Social Services will require additional personnel and technology. An added employee, costing approximately $80,600 annually, would support the waiver’s administration and related operations, while a software vendor contract, similar to that in Nebraska, could cost up to $250,000 per year. The federal government promises partial coverage of these expenses, but South Dakota’s share remains considerable.
The program wouldn’t be fully operational until fiscal year 2028, beginning on July 1, 2027. The completion of a fiscal impact statement paves the way for a Senate vote, after which Governor Rhoden’s decision will determine the bill’s ultimate fate. A gubernatorial veto would need to be countered by a two-thirds majority in both legislative chambers to become law.
Amid economic considerations, the proposed legislation raises broader questions about state versus federal jurisdiction in public health and welfare reform. Clearly, the debate over the soda ban encapsulates more than just South Dakota’s budgetary outlook—it highlights a national dialogue about health, governance, and responsibility.
As lawmakers navigate these political waters, South Dakotans must consider the costs and benefits of reshaping food assistance programs to promote healthier living without overburdening state coffers. This debate will continue to attract local and national attention as decisions unfold.