PIERRE, SD (STL.News) Today, Governor Kristi Noem announced that South Dakota closed the 2021 budget year on June 30 with a surplus of $85.9 million. Total general fund revenue for fiscal year 2021 finished $62.0 million higher than adopted estimates, and the state general fund budget ended with expenditures approximately $23.9 million lower than budgeted.
“Because of our respect for freedom and our continued emphasis on fiscal responsibility, South Dakota’s financial house is in order and positioned to ensure a safer, stronger, and healthier South Dakota for the next generation” said Governor Noem. “Our economy continues to be the strongest in America. Our low unemployment rate, strong labor force recovery, and terrific tourism numbers are generating historic revenues for the state.”
South Dakota’s year over year growth in fiscal year 2021 was $274.2 million or 15.7%, compared to a ten year average of 4.6%. This historic growth is the largest that the state has seen in over 30 years; quite possibly in state history. Sales and use tax, which is the state’s largest revenue source, finished $26.6 million above estimates and grew 14% over the prior fiscal year, compared to a ten year average of 5%. The full fiscal year 2021 revenue metrics can be found at bfm.sd.gov.
“We will continue to be responsible stewards of the taxpayers’ money with an eye towards future economic difficulty,” continued Governor Noem “With Washington driving high inflation and the Federal Reserve planning to raise interest rates, our rainy day fund is in strong shape to weather whatever challenges may arise.”
By law, the fiscal year 2021 surplus of $85.9 million was transferred to the state’s budget reserves. The state’s reserves now total $301.8 million, or 16.6% of the fiscal year 2022 general fund budget. The state has held a AAA credit rating with all three major credit agencies since 2016.