South Dakota REDI Fund
South Dakota Governor's Office of Economic Development (GOED)
Up to $3,000,000
South Dakota REDI Fund — 3% job-creation loan
South Dakota's primary economic development incentive provides low-interest revolving loans to businesses creating quality jobs in South Dakota. The REDI Fund (Revolving Economic Development and Initiative Fund) provides loans at a fixed 3% interest rate of up to $3 million to companies committing to create permanent, full-time jobs. Borrowers must contribute a minimum 10% equity toward the project. Loans may be partially forgiven based on job creation milestones, but are not automatically forgiven — they function as revolving loan fund instruments, not grants.
- Funding type
- Forgivable Loan
- Level
- State
- Amount range
- $50,000 – $3,000,000
- Realistic amount
- A 20–50 job project in a rural South Dakota community with $2M+ in capital investment typically receives $200,000–$600,0…
- Deadline
- Rolling — no annual application cycle. GOED reviews applications on a deal-by-deal basis.
- Status
- active
- States
- SD
- Payment model
- milestone
Who qualifies
- For-profit business (any size) locating to or expanding in South Dakota
- Must create or retain a minimum number of permanent full-time jobs (threshold varies by project — no published minimum, but typical floor is 10+ jobs)
- Jobs must offer wages at or above the county average wage
- Must contribute a minimum 10% equity toward the total project cost
- Must demonstrate capital investment in South Dakota (equipment, building, infrastructure)
- Must demonstrate economic need for the incentive ('but for' test — project would not proceed or would be smaller without the REDI Fund)
- Company must sign a performance agreement with GOED specifying job count and wage milestones
Hard requirements
- Must be incorporated
What it covers
Eligible expenses
- Land acquisition for the SD project
- Construction or renovation of SD facilities
- Machinery, equipment, and technology purchases
- Working capital directly tied to new job creation
- Infrastructure improvements at the project site
Ineligible expenses
- Retail trade operations (statutory exclusion in many SD incentive programs)
- Projects outside South Dakota
- Costs incurred before GOED application approval
- Administrative or overhead costs unrelated to the expansion project
How to apply
-
1
Contact GOED during site selection
Engage the Governor's Office of Economic Development during site evaluation — before committing to a South Dakota location. GOED can structure a preliminary incentive package. Projects that approach GOED after deciding on SD are harder to support with the 'but for' requirement.
~8 hrs
-
2
Submit REDI Fund application
Provide GOED with: project description, job creation plan (count, wages, timeline), capital investment plan, company financial profile, and 'but for' justification explaining why the SD incentive influences the location/expansion decision.
~8 hrs
-
3
Board of Economic Development approval
GOED presents the application to the South Dakota Board of Economic Development for approval. Board meets periodically — allow 4–8 weeks from application to board decision.
~8 hrs
-
4
Execute forgivable loan agreement
Sign the REDI Fund agreement with GOED specifying: loan amount, performance milestones (job count, wages), forgiveness schedule, reporting requirements, and recapture provisions.
~8 hrs
-
5
Create jobs; receive forgiveness proportional to performance
GOED disburses funds. As job creation milestones are verified annually, corresponding loan tranches are forgiven. Full forgiveness achieved when all commitments are met over the performance period (typically 5 years).
~8 hrs
GOED needs to be involved during active site selection — not after you've chosen SD. The 'but for' test is real; if GOED believes you're already committed to SD regardless of incentive, the REDI Fund application weakens significantly.
Deadline & timing
Must apply before project commencement. GOED requires project to be in active site selection or pre-decision phase before the REDI Fund can be a factor in the location decision.
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Last reviewed 2026. GrantCompass is an independent funding-discovery tool and is not affiliated with any government agency. Always confirm details on the official program page.