State ends fiscal year with $97 million surplus
The state is announcing a fiscal year surplus of $96.8 million dollars.
That money will go into reserves.
State government spent nearly $80 million less than what it was appropriated last fiscal year, which ended on June 30.
However, the sales and use tax finished half a percentage point below anticipated, down $6.9 million.
This past session, state lawmakers cut the overall state sales tax by .3 percent, resulting in a roughly $100 million cut to the budget. Representative Tony Venhuizen sits on the committee that sets the state budget. He says lawmakers are anticipating a dip in revenue and growth.
“We had a very conservative estimate for tax growth in this current year that we’ve started,” Venhuizen said. “If we’re starting to see a slowdown from the historically high growth we’ve seen the last three years, that is something that both the administration and appropriations committee anticipated.”
Venhuizen said it is great to see the state remains in a strong financial position.
Gov. Kristi Noem is already indicating where she would like to spend the money. She wants to put it toward future prison construction costs. Earlier this year, Noem signed two bills appropriating over $380 million for two prison projects.
Democratic Representative Linda Duba also sits on the budget committee. She said sending the surplus to the prison is not an automatic for her.
“I know we are challenged with the cost of the prison, but I think we need to see where the needs of this state are before we make a decision,” Duba said. “We do have Medicaid expansion. I’m not going to be so quick to jump and say, ‘Ah! We’re going to spend it on this.’ There will be needs.”
Duba said she’s pleased with how close lawmakers came in their revised estimates, which is done every session.
The states reserve fund now sits at about $336 million. The placement of surplus into reserves means the state will maintain its AAA credit rating.