Difference between revisions of "South Dakota state budget"

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In addition to the individual state profile, IGPA offers a 50-state comparison and profiles for other states.<ref>[ [http://igpa.uillinois.edu/system/files/50_States_Transparency_Profiles.pdf University of Illinois 50 State Transparency Comparison]</ref><ref>[http://igpa.uillinois.edu/content/state-transparency-profiles University of Illinois State Transparency Profiles]</ref>
In addition to the individual state profile, IGPA offers a 50-state comparison and profiles for other states.<ref>[ [http://igpa.uillinois.edu/system/files/50_States_Transparency_Profiles.pdf University of Illinois 50 State Transparency Comparison]</ref><ref>[http://igpa.uillinois.edu/content/state-transparency-profiles University of Illinois State Transparency Profiles]</ref>
===U.S. PIRG Following the Money report===
===U.S. PIRG "Following the Money" report===
{{Following the Money 2014 Advancing States|State=South Dakota|Grade=B+|Score=89.5|Level=advancing}}
{{Following the Money 2014 Advancing States|State=South Dakota|Grade=B+|Score=89.5|Level=advancing}}

Revision as of 15:38, 21 April 2014

South Dakota state budget
Budget calendar:  Annual
Fiscal year:  2013
Date signed:  March 16, 2012
Other state budgets
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South Dakota's budget for FY2013 is $4 billion and became law after Governor Dennis Daugaard signed it on March 16, 2012. The budget spends $1.2 billion in general funds, $93 million more than the FY2012 budget.[1]

The state operates on an annual budget cycle.[2] The state's fiscal year begins July 1.

South Dakota has a total state debt of approximately $6,536,680,000 when calculated by adding the total of outstanding official debt, pension and other post-employment benefits (OPEB) liabilities, Unemployment Trust Fund loans, and the FY2013 state budget gap.[3] The FY2013 state debt is down from the prior year's total of $6,585,256,000[4]

South Dakota's total state debt per capita is $7,932.07.[5]

See also: The South Dakota State Budget on State Budget Solutions

Economic Freedom

A new Fraser Institute report on economic freedom ranks South Dakota 6th in economic Freedom. Delaware ranks 1st and New Mexico ranks 50th. The study examines the impact of economic freedom on both the level of economic activity and the growth of economic activity. According to the study, the freest economies operate with minimal government interference, relying upon personal choice and markets to answer basic economic questions. More governmental restrictions on those choices curbs economic freedom. The study looks at three major categories per state – size of government, taxes and regulations.[6]

Federal Aid to State Budget

The chart below represents how much of the state’s budget comes from the federal government. The number is the corresponding ranking in relation to the rest of the nation (if #1, the state receives the highest percentage of federal funding in the nation):

State 2008 2009 2010 2011
South Dakota 36.67% (#4) 39.85% (#4) 44.95% (#5) 45.56% (#4)
  • Figures were calculated by dividing each state’s intergovernmental revenue into its general revenue.[7][8]

Fiscal Year 2014 State Budget

Gov. Dennis Daugaard has proposed a $4.1 billion state budget on Dec. 4, 2012. The budget can be found here. The governor's proposal provides small increases similar to inflation in state spending on education, health care and salaries for state workers. Education would see a 3 percent increase.[9]

The proposed budget leaves $26.5 million uncommitted over the next two years, and most of it could go toward one-time expenditures.[10]

The state legislature must pass before adjourning in March of 2013.[10]

Fiscal Year 2013 State Budget

Governor Dennis Daugaard signed the $4 billion FY2013 budget into law on March 16, 2012.[11] The budget bill, SB 197, as enacted can be found here and the budget in brief can be found here.

The budget spends

  • $1.2 billion in state general funds,
  • $1.75 billion in federal funds, and
  • $1 billion in other state funds dedicated to specific purposes such as highway construction and maintenance.[11]

Spending increases in the budget include:[11]

  • 2.3 percent increase in state aid to school districts to account for inflation,
  • 1.8 percent ongoing average increase in reimbursements to Medicaid providers, and
  • 3 percent across-the-board salary increase for state employees.

The $1.2 billion general fund includes more than $405 million for schools and more than $463 million for health, human and social services.[12]

Budget Negotiations

The Joint Appropriations Committee determined that revenue for FY2013 would be approximately $10 million higher than the governor projected.[13]

Governor Daugaard presented his FY2013 budget to the legislature on December 6, 2011.[14] A summary of the governor's proposed budget can be found here. Under the budget, $463,456,625 (equivalent to 37.3%) would go to Health and Human Services and $404,622,459, or 32.5% percent, would go to local government and education. Corrections would receive $82,814,360, or 6.7 percent.[15]

Agencies began submitting FY2013 budge requests in fall of 2011. The Department of Education is asking that the legislature stick to the school funding formula, something that hasn’t been done the last two years.[16]

Fiscal Year 2012 State Budget

The state ended FY2012 with a surplus of almost $50 million,[17] due in large part to an increase in ongoing revenue, which was $70 million higher in FY2012 than expected.[18]

The South Dakota legislature approved a $3.9 billion budget for FY2012 and was signed by the governor on March 17, 2011.[19] Governor Dennis Daugaard said South Dakota was the first state in the nation to pass a budget for FY2012.[20]

The budget spends $1.1 billion in general funds and eliminates the state’s $127 million structural deficit.[20] It also spends $1.75 billion in federal funds and $1 billion in other funds.[21]

The budget makes cuts to government agencies, Medicaid, and education, but some of the cuts are not as drastic as originally feared. Another $12 million, available because the growth in Medicaid patients has been lower than expected, was awarded as a one-time boost to some medical facilities.[20]

The budget does not raise taxes and does not tap into the state's reserves.[19]

In the first quarter of FY2012, state sales tax collections were up 2.4 percent from the same period a year ago, which is what the Legislature expected when it passed the state budget.[22]

Budget Cuts

For the third year in a row, South Dakota’s state employees will not be receiving any pay raises.[23]

Funding for South Dakota Public Broadcasting was cut by $537,000 in addition to being cut $750,000, just over 16% in March 2011.[24]


The budget trims K-12 education funding by 6.6%, less than the 10% originally proposed by the governor in part because of the use of $12 million in one-time funds[25] and also because another measure allows school district property taxes to remain at current levels instead of falling to match declining state aid.[20]

In the budget, the university system receives slightly more than $150 million from state general funds.[26]


The cuts to Medicaid and health care are also 6.6% overall, but the size of cuts to different kinds of facilities will depend on how much they depend on Medicaid as a revenue source. Another $12 million, available because the growth in Medicaid patients has been lower than expected, was awarded as a one-time boost to some medical facilities.[20]

Governor's proposed recommendation

The governor's recommended budget for FY2012 in the complete budget book can be found here.

Governor Daugaard's proposed budget for FY2012 , including special appropriations, totals $3,921,743,642, which is an overall decrease of $172,953,151 in total funds from FY2011. For FY2012, the Governor is proposing a general fund budget of $1,136,463,152, down $12,365,660 million from FY2011.[27]

The governor's proposed FY2012 general fund budget is distributed as follows.[27]:

  • $349.9 million, or 30.8% for Aid to Schools;
  • $425.8 million, or 37.5% for Health, Human, and Social Services;
  • $150.7 million, or 13.3% for Higher Education;
  • $78.4 million, or 6.9% for Corrections;
  • $59.2 million, or 5.2% for the Legislature, Unified Judicial System, Public Utilities Commission, and Elected Officials;
  • $15.4 million, or 1.3% for Agriculture; Environment and Natural Resources; and Game, Fish, and Parks; and,
  • $57.1 million, or 5.0% for the Remainder of State Government.

Budget background

FY 2009 Budgeted FY 2010 Appropriated
General $1.154 billion $1.134 billion
Federal $1.556 billion $1.859 billion
Other $963 million $951 million
Total $3.673 billion $3.945 billion[28]

South Dakota's fiscal year begins July 1 and ends June 30 of the following year. State law requires annual preparation and approval of the state's budget and according to the State Constitution, the budget is required to be balanced before approval. The Governor presents the annual budget to the Legislature by the first Tuesday following the first Monday in December. Both the House and the Senate are then required to approve a budget by the end of the legislative session. The Governor has the power to veto individual line items in the budget approved by the legislature.[29]
Throughout the fiscal year the state budget must remain in balance and state agencies are not allowed to request additional funds. However, the commissioner of the Bureau of Finance and Management has the authority to authorize intradepartmental transfers of funds so long as the total spending levels are not exceeded. Transfers must first be accepted by the legislature's Interim Appropriations Committee.[29]

Budget figures

The following table provides a history of South Dakota's expenditures and gross domestic product (GDP).

Fiscal Year Expenditures (billions) GDP (billions)
2000 $3.8[30] $23.1[30]
2001 $4.0[30] $23.9[30]
2002 $4.3[30] $26.4[30]
2003 $4.4[30] $27.4[30]
2004 $4.6[30] $29.5[30]
2005 $5.0[30] $30.5[30]
2006 $5.2[30] $32.0[30]
2007 $5.4[30] $33.9[30]
2008 $5.7[30] $36.0[30]
2009 $6.0*[30] $38.1*[30]
  • NOTE: The figures for FY 2009 won't be finalized until the end of the fiscal year.

Accounting principles

See also: South Dakota government accounting principles

The South Dakota State Auditor is an elected position, and constitutionally independent office holder who performs pre-audits and performance audits of all state government agencies. Richard Sattgast has held the office since first elected in 2002.[31]

The South Dakota Department of Legislative Audits (DLA) performs financial and compliance audits of state agencies and local governments including the following types of entities:[32]

  • State Agencies
  • Universities
  • Authorities
  • Counties
  • Municipalities
  • School Districts
  • Townships

The DLA publishes its audit reports online. Martin L. Guindon is Auditor General of the DLA.[33]

The Institute for Truth in Accounting (IFTA) rates South Dakota “Worst” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider South Dakota's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[34]

South Dakota's rating from Standard and Poor's was upgraded from AA[35] to AA+ in 2011.[36]

Budget transparency

Government tools

Open.sd.gov is the name of South Dakota's publicly available spending transparency database. It was announced on March 12th, 2008, approximately 6 months after transparency legislation from State Representative Hal Wick had been vetoed.[37] South Dakota Senate Bill 143 (2009), which was signed into law on March 13, 2009[38] required "a searchable internet website for the posting and access of certain public records and financial information."[38]

Open.sd.gov provides a database of state financial information, organized by broad topics such as budget, expenditures, revenues, vendor contracts, and payroll. Much of the information is updated twice per week. And, since data populating the database is tied directly to South Dakota's accounting system, payroll information is updated in real-time (that is, as soon as information enters the general accounting system software, it will appear on this database).

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases
State Database Searchability Grants Contracts Line Item Expenditures Dept/Agency Budgets Public Employee Salary
Open SD P
600px-Yes check.png
600px-Yes check.png
600px-Yes check.png
600px-Yes check.png
See also: Evaluation of South Dakota state website

Public employee salary information

See also: South Dakota state government salary

Multi-Measure Budget Transparency Profile

The Institute of Government and Public Affairs at the University of Illinois created a multi-measure transparency profile for South Dakota, which measures state transparency as of September 2011 using indicators from a range of organizations. These indicators measure both website transparency and other recognized facets of governmental transparency. In addition, IGPA presents four unique indicators of non-transparency based on the observation that transfers or reassignments between general and special funds can obscure the true fiscal condition of a state.[39][40]

In addition to the individual state profile, IGPA offers a 50-state comparison and profiles for other states.[41][42]

U.S. PIRG "Following the Money" report

See also: Following the Money 2014 Report

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2014. The report, entitled "Following the Money," measured how transparent and accountable state websites are with regard to state government spending.[43] According to the report, South Dakota received a grade of B+ and a numerical score of 89.5, indicating that South Dakota was an "advancing" state in terms of transparency regarding state spending.[43]

See also

South Dakota government sector lobbying
South Dakota public pensions

External links


  1. NECN.com "Gov. Dennis Daugaard signs $4 billion SD budget" March 16, 2012
  2. National Conference of State Legislatures "State Experiences with Annual and Biennial Budgeting" April 2011
  3. Budget Solutions "State Budget Solutions' third annual State Debt Report shows total state debt over $4 trillion" Aug. 28, 2012
  4. State Budget Solutions “Report reveals aggregate state debt exceeds $4 trillion” Oct. 24, 2011
  5. State Budget Solutions "State debt more than $37,000 per private worker, $13,000 per capita" Oct. 2, 2012
  6. Fraser Institute, Economic Freedom of North America 2012
  7. US Census Federal Aid to State and Local Governments
  8. Tax Foundation' "Monday Map: Federal Aid to State Budgets. Accessed October 15, 2013
  9. KELO "SD Governor Proposes Modest Boost In Spending" Dec. 4, 2012
  10. 10.0 10.1 The Aberdeen News "SD budget: Daugaard proposes increases on schools, health care, salaries" Dec. 4, 2012
  11. 11.0 11.1 11.2 NECN.com "Gov. Dennis Daugaard signs $4 billion SD budget" March 16, 2012
  12. South Dakota Budget In Brief, Fiscal Year 2013 prepared by the Department of Executive Management
  13. The Republic "SD lawmakers face decisions on state budget, bonuses for teachers and state employees" Feb. 26, 2012
  14. [Daugaard's budget calls for $1M to defend abortion law, other cases" Rapid City Journal Dec. 11, 2011]
  15. [1]
  16. Keloland.com "Daugaard: 'Hint Of Promise' In State Budget" Sept. 12, 2011
  17. The Argus Leader "Ellis: $50 million surplus ignites legislative fight" July 21, 2012
  18. The Argus Leader
  19. 19.0 19.1 The Rapid City Journal "Daugaard signs budget bill" March 17, 2011
  20. 20.0 20.1 20.2 20.3 20.4 Forbes "SD lawmakers pass $3.9B budget to end session" March 11, 2011
  21. CBS MoneyWatch "SD lawmakers preparing to pass next state budget" March 1, 2012
  22. Businessweek "SD state revenue up slightly from projections" Oct. 14, 2011
  23. Capital Journal "Budget balanced but Capitol still buzzing" March 14, 2011
  24. Businessweek "State budget cuts will reduce SDPB staff, programs" March 30, 2011
  25. Capital Journal "Budget balanced but Capitol still buzzing" March 14, 2011
  26. Businessweek "Regents say salary increase is top budget priority" Aug. 11, 2011
  27. 27.0 27.1 State of South Dakota Budget Summary Book
  28. South Dakota Bureau of Finance and Manage ment, "State of South Dakota Budget in Brief Fiscal Year 2010," July 1, 2009
  29. 29.0 29.1 State of South Dakota,"Budget Overview," accessed March 25,2009
  30. 30.00 30.01 30.02 30.03 30.04 30.05 30.06 30.07 30.08 30.09 30.10 30.11 30.12 30.13 30.14 30.15 30.16 30.17 30.18 30.19 US Government Spending,"South Dakota State and Local spending," accessed March 25,2009
  31. The South Dakota State Auditor Web site, retrieved November 12, 2009
  32. South Dakota Department of Legislative Audits Web site, retrieved November 12, 2009
  33. South Dakota Department of Legislative Audits Web site, retrieved November 12, 2009
  34. Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
  35. State of Indiana, “State Credit Ratings-as of June 24, 2009"
  36. Stateline.org "A brief history of S&P's state credit ratings" Aug. 12, 2011
  37. "Gov. Rounds Announces Government Records Website," Office of the Governor Press Release, September 12, 2008
  38. 38.0 38.1 South Dakota Senate Bill 143 (2009): Bill Status
  39. Institute of Government and Public Affairs
  40. Dakota_Profile_IGPA_093011.pdf University of Illinois Transparency Profile for South Dakota
  41. [ University of Illinois 50 State Transparency Comparison
  42. University of Illinois State Transparency Profiles
  43. 43.0 43.1 U.S. Public Interest Research Group, "Following the Money 2014 Report," accessed April 15, 2014