South Dakota Gov. Daugaard signed SB 149, shielding taxpayer-funded child-placement agencies that refuse LGBTQ+ parents

On March 10, 2017, South Dakota Gov. Dennis Daugaard signed Senate Bill 149 into law, making South Dakota the first state in the nation to enact anti-LGBTQ legislation that year. SB 149 bars the state from taking "adverse action" -- revoking licenses, contracts, tax-exempt status, or state-benefit-program participation -- against faith-based or religious child-placement agencies that decline, on sincerely held religious or moral grounds, to provide adoption or foster-care placement services. The law lets agencies that receive taxpayer funding and operate under state licenses refuse LGBTQ+ and other prospective parents while continuing to receive public money and keep their state contracts. The South Dakota Legislature passed the bill by a 43-20 House vote on March 2 and a 27-8 Senate vote on March 7, 2017, before it reached Daugaard's desk.

The bill drew opposition from national and local child-welfare organizations, including the Adoption Exchange, the Child Welfare League of America, the National Association of Social Workers, and Voice for Adoption, as well as South Dakota pediatricians and family-law experts, who warned it would let religious agencies exclude qualified LGBTQ+ parents and single mothers from the state's foster and adoption system. The ACLU of South Dakota, which lobbied against the bill, said it "was never about religious freedom" but about letting private organizations that discriminate keep receiving state contracts and taxpayer dollars. Daugaard's decision to sign SB 149 contrasted with his veto the previous year of a bill that would have barred transgender students from using public-school restrooms consistent with their gender identity.