S.D. Codified Laws § 35-4-60.2
A licensee licensed under subdivision 35-4-2(3), (4), or (16) shall purchase any malt beverages that the licensee sells from the municipality if the municipality in which the licensee is located is licensed under subdivision 35-4-2(5) and if the municipality has adopted by ordinance a requirement that purchases of malt beverages by licensees under this section be made from the municipality. A municipality selling malt beverages to any licensee licensed under subdivision 35-4-2(3), (4), or (16) may not charge the licensee more than five percent above the municipality's cost for malt beverages plus freight unless the municipality has an operating agreement in effect on April 1, 1988, for its on-sale alcoholic beverage licensees licensed pursuant to subdivision 35-4-2(4) and imposes a mark-up higher than five percent for malt beverages. The municipality shall charge all licensees under this section the same price for malt beverages. The provisions of this section for a licensee licensed pursuant to subdivision 35-4-2(3) or (4) only apply if the licensee is located in a municipality with a population that exceeds eight thousand.
SDCL 35-4-60.2