Jan. 25, 2026
Forget whether tax increment financing as proposed was an appropriate way to fund Rapid City’s proposed Libertyland USA development.
Set aside, for now, if South Dakota and by extension its municipalities ought to exempt qualifying data centers from a big chunk of the sales tax they typically would pay.
Frist, let’s talk about Buc-ee’s.
It’s a Texas-based mega gas station and convenience store chain with a massive following. Fans rave online about the food,themed merchandise is even sold through Walmart,and the company has become known for the remarkable cleanliness of its bathrooms.
Essentially, Buc-ee’s has plenty of options when it comes to expansion plans.
So this week, when I saw the chain had committed to a store in Gretna, Nebraska, the “why” caught my attention.
Gretna, with a population approaching 10,000 people, is home to one of Nebraska’s Good Life Districts. Created a few years ago by the state’s Legislature, Good Life Districts are designated areas designed to attract tourism and economic development. These districts are allowed to use half of the state’s typical share of sales tax — 2.75 percent — to offset qualifying project costs such as constructing public streets and utilities. In Gretna, the incentive applies until 2054.
“And that incentive is actually what caught the attention of the Buc-ee’s enterprise. Without it, I’m not convinced that they would have looked at Nebraska,” Gretna city administrator Paula Dennison said in a news report.
This Buc-ee’s isn’t a typical convenience store. It’s proposed to be 74,000 square feet, located on 43 acres southeast of Interstate 80 and Highway 31. Stores that size rarely locate in communities that size.
“Buc-ee’s checks all the boxes the Good Life legislation was designed for; it generates significant tax revenue,increases our state’s tourism and creates hundreds of good-paying local jobs,” gretna Mayor mike Evans said in a news release.
Not surprisingly, Good Life Districts also drew controversy in Nebraska. The Gretna one in particular has seen starts, stops and all kinds of potential concepts floated, plus there have been issues around the correct way to structure the state programme and what kind of guardrails to put around it. It has not been the smoothest ride, but at least they’re attempting a different way to attract the sort of larger-scale developments that can move the needle for a community and by extension the state.
When you offer an incentive to a business to locate in your state or community, it’s always a bit of a roll of the dice.
You generally are giving up some immediate revenue — in South Dakota, it’s usually property tax — for the prospect of greater revenue in the future and broader-based business activity. There are unique hurdles that come with redeveloping old,industrial downtown areas,for example. By allowing a portion of property tax paid to directly offset those costs, the idea is that the development will become a catalyst that could create additional growth: new residents, office workers, retail sales tax, etc.
The classic contrarian view is that private development would occur without incentives and that public dollars shouldn’t benefit a private business.
As in politics, I think the majority of people would take a moderate approach to offering economic development incentives. I also think they want the place they’ve chosen to live to attract the business activity necessary for steady, well-managed growth.
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