Law enforcement contract will expire

Barring an 11th hour deal, the City of Custer will enter 2026 without a law enforcement contract in place with Custer County.
After several months of negotiations the two entities remain at loggerheads, with the Custer County Commission rejecting the city’s latest counteroffer at a special commission meeting held last Thursday afternoon.
The commission unanimously approved at the meeting an authorization for state’s attorney Tracy Kelley to send a response letter to the City of Custer that acknowledges the current contract will expire and and rescinds all offers of a continued contract with the city.
“We as the county commission greatly appreciate the years the county and City of Custer have worked together with a law enforcement contract,” commissioner Mike Busskohl read from a statement. “We wish the City of Custer the best with their future coverage plans.”
“I would just like to say I’m really sorry that this is happening,” said City of Custer alderwoman Peg Ryan, who was present at the special commission meeting.
“So are we,” commissioner Craig Hindle said. “The citizens, business owners (and) chamber are going to suffer.”
How we got here
The exact date it happened is elusive to find both in archived issues of the Custer County Chronicle and government minutes, but sometime around late 1976 or early 1977, the City of Custer disbanded its police department and came under the umbrella of the Custer County Sheriff’s Office under a joint law enforcement agreement. A letter from then-attorney Bill Janklow to then-city attorney Jerry Baldwin discusses who Janklow believed would be in charge of what regarding the agreement.
Since then things have operated that way, and since 2000 the two entities have had a series of agreements, including one-year deals, a pair of three-year deals, one four-year deal and one five-year deal. In 2025 the two operated under a one-year deal that saw the city pay the county $435,000.
More recently the contracts saw a $10,000 annual bump that the city paid to the county, but at a late-summer meeting the commission informed the city it wanted $750,000—a 72 percent increase.
That in turn set off months of discussion and negotiation, with the two entities sending offers and counteroffers back and forth right up until the Dec. 18 commission meeting.
When the dust settled, the commission sought a three-year pact that saw the city pay $500,000 in 2026, $650,000 in 2027 and $750,000 in 2028. This allowed the city to budget accordingly to get to the requested dollar figure, the commission said.
The city’s final offer was $500,000 for 2026, with a 6 percent increase in each of the next two years. That was the offer the county rejected at its Dec. 18 meeting.
City of Custer Mayor Bob Brown said the county only recently started negotiating, saying although the issue first came up around the time of the Sturgis Motorcycle Rally, it was initially more demanding than negotiating.
“That’s not the way you negotiate, by coming in and (saying) ‘this is it—take it or leave it.’ That’s not negotiating,” he said. “For them to say they are negotiating with the city, they just started. They were demanding.”
Why the increase?
So why, after years of small price increases and a total that only recently crested $400,000, has the county suddenly asked for the dramatic increase?
The cost of doing business, it says. That steep increase was a long time coming.
“The city had a very good contract the last four years where it only went up $10,000 a year and the cost of running a sheriff’s office and what they expect for service greatly exceeds what the previous contract  has,” Busskohl said.
“The calls and the cost,” commissioner Mark Hartman said. “It’s only based on trying to help cover the costs of deputies, calls, vehicles, etc.”
Custer County Sheriff Marty Mechaley says the money the city paid this year covers around three-and-a-half full-time deputies when taking into account wages, benefits, etc. The reason for getting the contract hammered out by the Dec. 31 deadline is that three deputies—Lt. Jeff McGraw, Lt. Steve McMillin and Mechaley himself—are set to retire at some point in 2026, and without the requested city money, the commission has said it will not fill those vacancies, lowering the amount of deputies to 12 (counting the future sheriff) once those retirements are in effect.
“We need to maintain a sufficient number of staff to provide coverage to the citizens and  to do so in a safe manner for coverage and for deputies as well,” Mechaley said.
One of the problems with the requested increase, Brown said, is it appears the city will not see anything extra in the contract commensurate with the price increase.
“There is no reason we have seen, and they give us no reason or nothing that is going to improve or be made better by paying extra,” he said. “They are not giving us a reason to give it other than the city gets more calls. Well, the city is a city. You’re going to have more calls.”
The calls
According to Custer County Sheriff’s Office Sgt. Derrick Reifenrath, as of 10 a.m. Dec. 11, the sheriff’s office had received 13,072 calls for the year, of which 4,801 generated from inside city limits—a 36.7 percent clip. These figures includes 431 ambulance transfers.
Both sides admit looking solely at the calls does not tell the entire story.
The city contends many of the calls that generate from inside the city are only calls in the literal sense. Some are moving a dead squirrel off the road. Some are ambulance transfers. Some are medical calls. All add up in regards to call volume, however.
Reifenrath said the sheriff’s office has to be on some ambulance transfers because there is a mental health component and the person being transferred could be violent. 
Mechaley points out that argument goes both ways, as well. If deputies do foot patrol downtown on and off all day during the rally, that’s one call. If a deputy spends hundreds of hours over the course of year investigating a burglary, that’s one call.
“A call is a call. What agency anywhere logs every little thing they do?” he asked. “If people want us to break down and hit a time clock every time we come into the city limits, that’s all we are doing to be doing.”
Mechaley also said the 24 hours a day, seven days a week coverage the county provides to the city should not get lost in the argument.
“Two days ago we had a mental health case in Custer. We picked the individual up, had to take them to Rapid, spend several hours with them in Rapid, had to bring them back. That’s one call,” he said.
The finances of it all
Like anything involving money, the number issues can be ever-evolving and complicated.
Custer County’s public safety budget for 2026 is $2,662,985. Of that, $2,031,663 is the sheriff’s office budget, while $520,500 is budgeted for prisoner care. Any time the sheriff’s office hauls someone to the county jail, whether they are from Custer, Hermosa or the Highlands, the county is on the hook for their stay and their medical care while in custody. If someone is in jail for a long time awaiting adjudication of their case, the fund can be drained quickly.
Also included in the county’s public safety budget is $51,000 for search and rescue, $48,873 for the county coroner and around $10,000 combined for the Civil Air Patrol and safety office.
Also included in the county’s budget, which is slated to be just over $13 million, is $14,883 for the 24/7 program—which monitors those on probation for use of alcohol or illicit drugs—and another $616,491 for dispatch. The county has told the city even if it forms its own police force—we’ll get to that later—it will have to pay the county for use of its 911 dispatch.
Dispatch does receive $2 from every phone bill issued in the county each month, with county budget documents showing that revenue makes up the bulk of dispatch’s $111,190 in total revenue, which pays for about 18 percent of the total dispatch budget. The 24/7 program pays for itself by charging participants.
As for the sheriff’s office, it took in revenue of $541,512 in 2025. This money comes from a variety of sources, including the city contract, grants and money from contracts for services provided to other entities—such as Custer State Park, the U.S. Forest Service and National Park Service. Custer State Park  paid the county $9,172 each for the sheriff’s office, dispatch and search and rescue, the National Park Service paid $15,000 for dispatch services at Wind Cave National Park and Jewel Cave National Monument, and the U.S. Forest Service paid $8,000 for patrols and equipment. The sheriff’s office also receives money from providing finger printing services and civil service judgments/executions.
The Custer State Park issue is one that has festered over he last few years, as the county railed over money it was spending on emergency services for the park.
“Why are they coming after us and not the park, which creates more revenue than we do?” Brown asked. “It affects the county more than what the city does. Why don’t they go after the state and say, ‘hey, you have got to start ponying up.”
Busskohl said he has lost track of how many meetings he has had with state officials making that same point, but believes there has been headway made in that area. Mechaley has reported park conservation officers are taking more of a lead on law enforcement issues in the park, and discussions continue with the state regarding compensation for county services.
“It’s not that we aren’t pursuing those,” Busskohl said. “We have limited options how to work with them.”
The city also contends the county has turned down $50,000 from the school district for district liaison officer deputy Matt Haugen, but Mechaley said that is not the case.
Mechaley said there was a time when the county received the $50,000 from the school district, but when federal COVID-19 money started flowing in that money was used for reimbursements and the contracts went away. More recently, the sheriff’s office has not entered into a contract with the school district because it cannot guarantee the district Haugen will be in the schools full time.
In fact, once McGraw retires, Mechaley said, Haugen will be pulled out of the schools and assigned to general patrol.
On the city end, the city passed a budget of just over $11 million for 2026, of which $3.379 million was earmarked for public safety. Of that, however, $2.2 million is a transfer from the Black Hills Community Fund or state funding that was raised via fundraising to help repair West Dam. In  the remaining funds was the anticipated sheriff’s office contract with a slight increase, as well as money for the fire department and just under $10,000 for other public safety. Minus West Dam, the city will spend around $760,000 on public safety.
The city raised $2,616,968 in sales tax in 2024, and around $1.3 million in property taxes, of which $69,000 is from an opt out that was created in 2002, ironically, to help pay for law enforcement.
A breakdown of the city budget over the years shows public safety has taken up anywhere from 18 to 29 percent of the general fund budget without capital expenditures. In 2025, it was 26 percent at a total of $645,628, with 58 percent of property tax revenue spent on public safety.
Of all of the property taxes brought in throughout the county, 67¢ from every dollar goes to the Custer School District, which had a $22 million budget most recently.
It’s one line item in the city public safety budget that seems to have caught the eye of the county commission, however.
West Dam
The city budgeted $620,000 toward the repair of West Dam in its 2026 budget.
Both Hartman and Busskohl declined to comment on whether or not it is the commission’s belief the city is spending money on the wrong things when it comes to West Dam versus the sheriff’s contract, but commission chairman Jim Lintz brought it up during the aforementioned Dec. 18 special commission meeting.
“You spent $650,000 on a dam,” Lintz said in response to Ryan saying the city could not give the dollars the county requested for the contract. Lintz added the city needed to decide what was most important to it. Busskohl later corrected Lintz, saying it was actually $620,000 budgeted by the city for the dam.
“West Dam isn’t for the city. It’s for the community,” Brown said.
Both the city and county can and have in the past made the claim they provide funding for entities that mostly benefit the other’s residents. For the county, the argument has been made that is the case with the Custer County Library, Custer County Airport, the services at the courthouse and investigating and incarcerating city offenders. On the city end, it provides wellness activities, contributes to the health care system, brings people to town for events from which business owners (many of which live outside city limits) benefit, and has given the county land for housing and for search and rescue. Brown said  when the community center is finished, over 60 percent of its members will be county residents.
“I’m not sure they see that,” he said. “They are more concerned about what’s right (in front of them). It’s a community.”
Comparing other communities
At a previous commission meeting, Mechaley presented the costs of law enforcement at other counties and communities in the area, and the city has done its own research as well.
The City of Canton, population 3,000, spends $800,000 on its police force, while the City of Beresford, population 2,000, spends $647,689. Mechaley’s presented figures can be found in the accompanying story in this issue.
The question as to whether apples to apples is being compared has been raised, however, as the City of Custer is unique in the millions of visitors who flood the town throughout the summer. Mechaley said the sheriff’s office could easily have a number of deputies into the 20s to keep busy in the summertime.
There’s no single ideal number, but the national average for officers per 1,000 people in a community is around 1.8 to 2.8, but experts stress that population-based ratios are misleading, and staffing should instead depend on actual workload, service calls, geography and community needs. Rural areas often need higher per capita ratios than large cities.
And would it be cheaper for the City of Custer to start its own department? The consensus seems to be no, but with a caveat—if the county asks for too much money it will eventually be cheaper to start a department, even with the upfront costs of purchasing cars, uniforms, equipment, etc.
Brown said the city never approached the discussion with the idea of the city forming its own police department again, although it has investigated doing so.
“It’s easier to stick with what we are doing. But there is going to come a day it prices us out,” he said.
Mechaley said if the city does decide to go that route, he would be more than willing to help with the formation in whatever way he can.
“Even when I’m retired I would try to help them to get it going,” he said.
SDCL 7-12-1
One of the largest focuses of the conversation over these months has been a state law that lays out the responsibilities of a sheriff’s office in the State of South Dakota—SDCL 7-12-1. The statute defines the core duties of a sheriff in a county and is titled “ Sheriff to preserve the peace—Apprehension of felons—Execution of process.”
The statute reads: “The sheriff shall keep and preserve the peace within the county. The sheriff may call to aid any person or power of the county as the sheriff deems necessary. The sheriff shall pursue and apprehend all felons, and shall execute all writs, warrants, and other processes from any court or magistrate for which the sheriff has the legal authority.”
To Brown and the Custer City Council, this means the county is obligated to provide law enforcement services, regardless of whether the city gives the county $750,000 or $1 toward law enforcement.
Mechaley disagrees with that assessment, and this very issue saw an attorney general’s opinion issued in 1987 by then-AG Roger Tellinghuisen when then-Bennett County Sheriff Thomas Jensen posed the question.
In his opinion Tellinghuisen wrote that he believed the sheriff is not under a duty to patrol the streets of a city on a regular basis, and courts have ruled the sheriff’s office does not have a duty to supply a full time road patrol as part of keeping the peace.
“In line with this authority, then, it is my opinion that the county sheriff would not ordinarily have a duty to provide a regular patrol of city streets when the city refuses to provide for its own law enforcement,” Tellinghuisen wrote.
Mechaley estimates 70 percent of the calls the sheriff’s office receives from the City of Custer do not meet the statute requirements for “keeping the peace” in the county, and it is that 70 percent the sheriff’s office will no longer respond to without a contract.
What type of calls are those? Animals at large. Loud music complaints. Fireworks complaints. Neighbor disputes. Helping with city parades. Extra help with Gold Discovery Days, July 4, the Sturgis Motorcycle Rally, etc. Felonies of course, will be pursued, but the ancillary things that are more of a city ordinance and not state law will not.
“If it were that easy to just say ‘it’s the county’s problem, it’s the sheriff’s problem,’ there would not be a single police department,” Mechaley said. “Show me one place or community that has two million visitors that doesn’t have a police department. It doesn’t work. I can tell you today without a doubt, it’s not going to work.
“I took the oath and ran for office to protect (city/county residents). But there are only so many hours in the day. My top priority is the safety of our deputies. Fewer staff means less immediate backup for them, and we already ask a lot of our men and women who put their lives on the line every day. I’m disappointed and fearful that their safety is not being taken seriously enough.” 
The double tax argument
City of Custer residents already pay for services from the sheriff’s office, city officials say. Like county residents, residents within city limits pay a county general levy, which for 2024 payable 2025 was 1.814.
“We are still county residents,” Ryan told the commission at its Dec. 18 meeting.
The city also charges a property tax levy which for 2024 payable 2025 was 3.993.
Because the city residents pay the county levy, city officials say, they should receive the same services as county residents, and the $435,000 paid by the city to the county is to pay for the extras the county says the city will now lose.
“We are already paying for law enforcement,” Brown said. “What we give them is to compensate for parades, rally, extracurricular activities.”
Brown also points out the other towns in the county—Hermosa, Pringle, Fairburn and Buffalo Gap—don’t contribute to the sheriff’s office budget, although Hermosa did at one time but now has its own marshal.
Commissioners say that is true, but also say people in those towns realize when they call the sheriff’s office, it could be a long wait and town ordinances will not be enforced, a fate they say now awaits city residents. When someone from the city calls 911 as of Jan. 1, they say, the deputy responding from the thinned out sheriff’s office could be responding from the eastern side of the county.
At the Dec. 18 commission meeting Hartman said he gets “a little bit cross” when he hears the double taxation argument, saying if the city already pays for law enforcement through the property tax levy then the city shouldn’t have its own street department or finance office—the county should take care of that as well.
What it means for the city
Brown said while the city has been researching options, the city does not have a firm plan at this time on how it will move forward without a contract with the county.
County officials say response time will drop. No, city residents won’t be billed by the county if they call 911, but the sheriff’s office may not respond depending on the substance of the call.
Mechaley said he will not abandon city residents.
“It’s not that we’re lazy and don’t want to help people. It’s just that we are going to lose staff. We are going to be severely short staffed,” Mechaley said.
Hartman said the county wasn’t cancelling its contract with the city and wasn’t trying to sell the city on the new contract but rather, wanted to work with the city. Either way, he said, the county needed to know the city’s decision, because it needed to know whether to plan to replace the retiring deputies.
“It’s just where we are at. Here is what it will cost to provide the service, now you guys decide if you want to do it or not,” he said. “We just had to get an answer.”
Hartman said during an event like the wind storm that happened last week, city residents will definitely notice the difference of there being no contract. Reifenrath said nearly 300 calls came in to dispatch during that time.
The sheriff’s office will do its best to provide 24/7 service Reifenrath said, but there will no longer be deputies assigned specifically to Custer. Deputies will go where calls lead them.
“We are always going to do the best we can with what we have,” Mechaley said.
Brown said when he became mayor one of his main goals was to bring the county and city together, which he still wants, but he said the county has to be willing to negotiate in good faith.
“It’s better if we all work together. In the long run, it’s going to be better,” he said. “But it looks like they are just trying to get us to pay half (the sheriff’s office) budget.”