Gov. Kristi Noem presents budget proposal in annual address
PIERRE, S.D. — South Dakota Governor Kristi Noem on Tuesday laid out her budget priorities for the state.
The bottom line: Gov. Noem’s budget anticipates a $28 million increase in revenue which would immediately be reinvested in law enforcement, infrastructure, and health needs.
In her address, the Governor said three principles will guide the state’s fiscal management strategy: fiscal discipline, implementing efficiencies, and transparency.
In developing the budget, the Noem Administration used economic assumptions that are more conservative than national assumptions. Currently, the forecast for national gross domestic product (GDP) growth is for 2.3% growth this year and 2.0% growth next.
The governor’s staff also assumed that inflation will continue to be low and acknowledged that the outlook for the agriculture sector in 2020 is uncertain.
Among the investment projects, the administration plans to spend $5.1 million to upgrade the state radio system infrastructure. There is also $5 million set aside for the Connect South Dakota rural broadband initiative, nearly $400 thousand for the Cyber Cync Incubator at Dakota State University, $5 million for a new School of Health Sciences building at the University of South Dakota, and $3.7 million to combat the methamphetamine epidemic.
Budget planners also anticipate increased enrollment in public schools and have adjusted both the general education and special education budget formulas accordingly. Using the adjusted formulas, special education funds have been increased by nearly $14 million for FY 2021.
One of the challenges facing the state is the recent implementation of the federal Internet Tax Freedom Act, which required that South Dakota and six other states stop taxing internet access. According to the Noem Administration numbers, that will result in a $20 million loss of revenue.
State legislators will have their opportunity to act on the Governor’s proposals when the next session begins in January 2020.