Gov. Noem’s grudges and pet peeves should not shape South Dakota's next state budget, says former lawmaker
The South Dakota Legislature will soon be making its mark on the 2025 mid-year correction and 2026 state budgets as proposed by Gov. Kristi Noem.
The governor tried to set low budget expectations by declaring this a “lean year.”
She used this argument to cut the budgets of programs she doesn’t like: Nearly eliminating the State Library, cutting South Dakota Public Broadcasting general fund budget in half, reducing state support for dual credit courses that high school kids take to get ready for college, and ridding us of those sad anti-smoking and drug abuse campaigns by the Department of Health, among many other cuts.
She hits teachers, nursing homes, health care, and state employees with a 1.25% increase, which is exactly HALF of the increase Social Security recipients get in 2025, and the lowest increase in over 10 years.
For more than 15 years, South Dakota has worked to bring maintenance and repair budgets closer to the national standard of 2-5%. But the governor plans to reverse that progress by proposing a cut of $16 million statewide, pulling our M&R effort down to 1.25% of replacement value. Her total cut to our state universities, including the M&R cut, is over $10 million!
Goodbye tuition freeze for students!
So, in this lean year, what could be more important to our governor than being a prudent steward of the state’s workforce, and our state’s infrastructure investment in office buildings, monuments, institutions and college campuses? How about prepaying $53 million of bonds and fully funding the cost of a prison project that will serve us for 50-100 years! How about pouring $4 million into private school vouchers for lucky kids (in addition to the $5 million of insurance company tax credits that already go to that cause) and $10 million to turn schools into fortresses against mental cases her gun laws have armed?
And finally, how about making permanent a tax CUT that is in part creating this “lean” year? Those are actions one takes in years of plenty, not in lean years!
Unclaimed property receipts have been a windfall for the state budget. Hundreds of millions of dollars have ended up in reserves because we chronically underestimate unclaimed property receipts. Explanations for those estimates are often vague and limited, even to appropriators, and if actual calculations are behind those determinations, I as a Democratic appropriator was never privy to them. Those “extra” funds then go to special governor-favored projects.
Her budget is filled with “look here, not there” Medicaid funding gimmicks. Medicaid funding is a huge part of the budget, and it can fluctuate depending on the economy, even more now with Medicaid expansion. But even before Medicaid expansion, the administration often locked away tens of millions of dollars by simply decreeing that “reserves for future years’ Medicaid expenses” were necessary.
In this year’s budget proposal, current year vs next year, ongoing and one-time Medicaid adjustments are the vehicle through which the bond pre-payments and prison funding are prioritized above funding more immediate basic government functions.
For her entire time in office, Gov. Noem (seen above in a 2019 public domain photo posted on wikimedia commons) has misled voters by claiming credit for healthy state tax receipts that were actually fueled by billions of President Biden’s federal Covid and American Rescue Plan Act (ARPA) funding, and for unclaimed property receipts so large they give South Dakota a taste of what an oil rich state enjoys.
She uses those one-time circumstances to claim credit for a “good economy” and to justify the state sales tax CUT be made permanent, when really tax receipts are decreasing WITHOUT a tax cut, because it was the federal money and the good ag economy that are now in the rear-view mirror that created the short-term increase in tax receipts!
Will the Legislature exercise the stewardship our governor did not when she loaded every last pet peeve, grudge match, and unfulfilled MAGA dream she could into her last opportunity to do so?
Watch the drama in Pierre this winter — unless SDPB cuts legislative coverage because of budget shortfalls.
Susan Wismer of Britton is a former state senator who served 10 years in the South Dakota Legislature. She was a member of either the Appropriations Committee or the Government Operations and Audit Committee for her entire tenure. Wismer is a certified public accountant. She and her sister Becky Weber have operated Britton Bookkeeping & Tax Service for 40 years.
