So I have an update on my situation:
Here's some background: DH is currently going to school and working in WI. SD and I live in the twin cities. She left our house 6 months ago to go live with a piece of crap drug dealer. She is not working, going to school or anything. She is constantly asking for money. DH will occasionaly send her some money (guilt), but I told him that I will not give her a dime. I am still in contact with her and see her about once a week for dinner. I love her like crazy and will not give up on her. Last weekend she was arrested on some warrants: shoplifting and underage drinking. DH and I refused to bail her out, but someone else did.

SD got out of jail on Sunday without help from my DH or I. She called him yesterday just bitching...She's broke now, she got out of jail with no help from us fu*!ers, blah blah blah. She also told DH that I had told her that I wanted to help her (financially) but he wouldn't let me. I NEVER said that. So I texted her and asked her when we had that conversation and she texted back that she was just mad and went off on her dad. I texted back that he didn't deserve it. She came back with we are so mean to her and we don't care about her. Again blah blah blah. So here's what I texted:
"You can always call us. But that doesn't mean we have to approve of what you.re doing. We love you, but I'm not gonna financially support the way you're living.That includes bail and money for partying. I really want to have a good relationship with you, but I'm not gonna pretend that all the bad choices you're making are ok with me. Cuz I'm constantly worried about your safety and sad about the way you threw everything away for some dude who does NOTHING for you. I will always be here for you, but you moved out and you're 20 years old, so we gotta try to have an adult relationship".
So I steeled myself for a nasty reply, and she wrote back "Thanks. I needed to hear that."
It felt good to be honest and felt better to heard for a change.