Budgeting for the future
By Governor Kristi Noem
December 10, 2021
This week, I outlined my budget recommendations for how we will run our state in the next fiscal year. The past year has brought historic challenges. South Dakota has taken those challenges in stride and has come out stronger.
Our state has the strongest economy in America. I want to make sure that we do not take that for granted, and that we also work to keep that momentum building. We are going to invest in our people and prepare for the future.
South Dakota is ranked in the Top 5 for fiscal stability. That is because for 133 years straight, we have passed balanced budgets and we hedge against potential downturns in the economy. This year, our state has seen tremendous growth in our revenue. That is why I am recommending a historic 14% — about $300 million — for strategic reserves in case the negative indicators in the economy start to make their way into our state.
These include historic investments in workforce housing, to spur new development of single- and multi-family homes. This includes $150 million from the state and $50 million in federal funds. A partnership with local cities and developers will triple the total investment to $600 million for new housing.
Through a partnership with local, state, and federal dollars, we can put $1.5 billion in combined funding to address water projects. These would replace aging infrastructure and help develop new systems for wastewater and sewers.
For those who are already working here, our Department of Social Services will be using $100 million in federal dollars to support existing daycares with one-time costs. These dollars can help expand availability at daycares, and also train more people to work at daycares.
And for those who are looking to switch careers or are getting ready to enter the workforce, I am recommending more than $47 million to expand skilled workforce training capacity at our colleges and universities. These include strengthening programs focused on healthcare, cybersecurity, manufacturing, and farming , and ranching. These programs have the potential to make our schools a top draw for students around the world. They also will attract some of the most competitive companies in a variety of industries.
Of course, we also need to keep our people healthy and strong. That is why I am recommending several key investments in healthcare. In addition to expanding workforce training so we have more qualified nurses, I am recommending we invest in marketing and recruiting for the industries most affected by the pandemic. I am supporting funding to create regional Behavioral Health Centers to help individuals struggling with mental health or substance abuse issues.
To improve access to care in our rural communities, I am recommending a combination of state and federal dollars to improve EMS services. These include funding for new technology to expand telehealth, upgrading life-saving equipment, and regionalizing services to improve response times.
I am recommending that the Department of Tourism use federal dollars to expand our successful marketing of both local and state attractions. South Dakota saw record tourism numbers this past year. We want to help these visitors explore more of our state by working with local cities and Native American tribes on marketing efforts to increase exposure.
I am also continuing my support of law enforcement by recommending several investments to our courts and to the Department of Corrections (DOC). These include targeted pay raises for the DOC to be competitive with other law enforcement agencies.
This week, I revealed that our DOC facility needs currently sit at about $600 million. We will not spend all of that today, but I am recommending the legislature save money for these needs in the future. I am recommending $28 million to build a Community Work Center for Women in Rapid City.
Last, but not least, I am recommending a historic 6% increase in funding for our state employees, educators, and healthcare providers. This increase is the largest in state history, and it is necessary because of dramatic inflation and to keep our salaries competitive.
Of course, this is not the complete budget recommendation. These are some of the highlights of solutions to priority issues facing South Dakota. To view my full budget proposal for the Fiscal Year 2023, go to https://bfm.sd.gov/budget.