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Noem to deliver 'tight' budget address Tuesday

Gov. Kristi Noem will deliver the annual budget address Tuesday.

The governor will outline her budget priorities, which help set the tone for the upcoming session.

The Republican governor is already warning lawmakers to ”stick to a tight budget.” Noem said that’s because revenues are “going back to normal.”

Since the pandemic, the federal government pumped over $10 billion into the state.

Noem's initial cautionary remarks are directed toward the large cohort of new lawmakers who’ve taken office since the pandemic.

“This year, the budget address is going to be a little bit of back to reality," said Tony Venhuizen, R-Sioux Falls, a first-term lawmaker who sits on the committee that crafts the state budget. While he’s newly elected, Venhuizen was chief of staff for both Noem and Dennis Daugaard.

 “We’ve had three years or so where the fast economic growth, inflation, the federal stimulus, has led to revenue growth unlike anything the state has seen before," Venhuizen said. "Our economy is still in pretty good shape, but the days of 10, 12, 15 percent revenue growth are over. We’re back to revenue growth in the 3, 4, 5 percent range.”

During her speech she’s expected to outline a plan for spending the remaining $105 million in American Rescue Plan dollars.

Noem wants lawmakers to make permanent a sales tax cut, which saves taxpayers 30 cents for every one hundred dollars they spend. Officials estimate that will reduce revenues by $104 million.

Reynold Nesiba, D-Sioux Falls, said he’d rather see that money go toward providing school lunches, which is expected to cost the state $40 million. 

“I’d be willing to actually let that go back to where it was before if we can get free lunches and free breakfasts for kids paid for," Nesiba said.

Lee Strubinger is SDPB’s Rapid City-based news and political reporter. A former reporter for Fort Lupton Press (CO) and Colorado Public Radio, Lee holds a master’s in public affairs reporting from the University of Illinois-Springfield.