Governor Kristi Noem’s Weekly Column: A responsibility to be smart with taxpayer dollars

A responsibility to be smart with taxpayer dollars
By Governor Kristi Noem
September 17, 2021

Do you find yourself wondering where your tax dollars go? In South Dakota, the simple answer is to education, health care, public safety, and other state government operations. But if you really want to talk dollars and cents, I can break it down for you using the change you find in your couch cushions.

Of course, we’ve got to start with the rules. In this case, Article 12 of the state Constitution says I must sign a balanced budget and cannot plan to spend more than we earn each year. That’s good because it means lawmakers, who negotiate the budget during each legislative session, are Constitutionally bound to pass a responsible budget.

When times are tight, we cut spending. When our economy goes from 83% performance rating on January 1st up to a peak of 116% just last month, you end up with a surplus of more than $80 million at the end of the fiscal year.

Before we look ahead, let’s first break down how the state chose to spend its funds before our economy hit turbo drive.

Remember what I said about that change in your couch? Here’s the breakdown of how much of your state tax dollar goes into specific areas of the budget:

• 49-cents of every dollar goes to education in South Dakota. This includes public schools, higher education, and tech colleges.
• 36-cents of every dollar goes to health care. Medicaid. Social Services. The Department of Health. The Department of Human Services. State institutions. All going to serve South Dakotans so they get access to the care they need.
• A dime out of every dollar goes to public safety, including our courts and justice system, prisons, and the Attorney General’s office.
• And a nickel of every dollar, the least of all expenditures, goes to running other state government operations.

That funding breakdown includes continuing operations and making smart investments in the future of our state. Last session, we saw major victories in growing the state’s commitment to broadband connectivity from border to border — the total state investment was $75 million.

We also appropriated a combined $72 million toward scholarships and bond payoffs for technical colleges. This is a significant boost to serving South Dakotans with higher education. The Health Care Trust Fund received $50 million, with additional funding to expand the availability of doctors and nurses across the state.

Other investments in our future include:

• $20 million toward a Bioprocessing Facility
• $20 million for railroad rehabilitation in West River
• State-supported investments of $19 million to help with the SDSMT Mineral Industries Building project; and $12 million to help fund the Dakota Events CompleX at the State Fair
• We also put $10 million in the IT modernization fund to ensure South Dakota is keeping up with technology trends for efficiency.

All of these investments are strengthening our state’s ability to compete, without over-burdening taxpayers. All of these investments were made well before our economic engine started picking up speed.

Now our economy is booming compared to where we were at the start of the pandemic. We continue to lead the nation in Moody’s “Back to Normal Index,” with our economy performing at 106% compared to March 2020.

We are also among the top in the nation, according to U.S. News, when it comes to fiscal responsibility – both in the short-term and long-term management. Not to mention, South Dakota is consistently listed among states with the lowest tax burden in the nation.

Taxpayers should be encouraged by that as we look ahead at responsibly managing nearly $1 billion in anticipated federal assistance over a five-year period. We also will be carefully considering smart one-time investments with surplus funds; investments that will keep our economy running strong while being good stewards of the taxpayer dollar.

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