State lawmakers are setting revenue projections for the current and coming fiscal years.
The numbers anticipate continued growth. Some are not convinced.
Lawmakers are revising revenue estimates for fiscal year '22 up by $228 million. That fiscal year ends in June. Original estimates were made prior to the latest federal COVID stimulus package.
Lawmakers on the budget committee estimate fiscal year '23 revenue will come in $92 million more than what the governor estimated last December.
Republican Rep. Chris Karr, R-Sioux Falls, is chair of the Joint Appropriations Committee. He says a lot of positive things are happening in the state economically.
“I believe that we’re going to continue to see that economic prosperity,” Karr says. “I also do think that inflation is going to increase a little bit, but our wages have increased. At the end of the day, if the cost of our goods increase we’re still—our sale tax we collect is on the cost of that good. At the end of the day we will collect revenues at a higher level, even with some of those concerning factors.”
It’s those factors that caused some to vote against the projections.
State Sen. Jean Hunhoff, R-Yankton, leads the Senate Appropriations Committee. She was one of three who voted against the projections. Hunhoff says she’s concerned the Joint Appropriations Committee is projecting too high.
Hunhoff says she’s concerned about another thing, too.
“We have had a really dry winter. If we don’t get much moisture our ag sector is going to be struggling. You’re going to have some additional costs out there and concerns on how to address that,” Hunhoff says. “I think we just aimed too high, but that’s in the eye of this beholder and that was not in agreement with the rest of the committee.”
Hunhoff says the state coffers are loaded with federal stimulus money from the pandemic. She says similar dollars came in during the Great Recession about a decade ago, but the state reached a fiscal cliff and each department had to cut its budget.
Hunhoff says she doesn’t want to go through that again.
