Gov. Larry Rhoden called Thursday for a 1 percent increase in state funding for public education, Medicaid, and state employees after lawmakers boosted ongoing revenue estimates by about $30 million.
The Union Center rancher unveiled the proposal at a 10:30 a.m. press conference at the state Capitol, a few hours after the Legislature’s Joint Committee on Appropriations adopted updated revenue estimates.
Rhoden said his original budget left no room for the so-called “big three” because nearly all ongoing dollars were spoken for by mandatory increases from the federal government.
“When I presented my budget, nearly all of the ongoing dollars were spoken for by mandatory increases from the federal government,” Rhoden told reporters. “So we didn’t have anything left for the big three, which are education, healthcare, and state employees. Well, we do now.”
Across-the-board approach
Rhoden said he’s advocating that lawmakers put a 1 percent inflationary increase into the big three with the new revenues.
“Here’s what I’d like about the across-the-board increases for the big three,” Rhoden said. “It doesn’t pick winners and losers. And it treats the most important aspects of state government equally. It’s about taking care of the people.” (2:01-2:12)
The governor said the increase supports teachers and schools to give students the best opportunity for their future, keeps South Dakota healthcare strong, and supports state employees who help keep South Dakota strong, safe, and free.
“That’s my proposal,” Rhoden said. “And I hope the legislature goes along with that. They will obviously have a lot to say about that.”
Revenue estimates increased
The Joint Appropriations Committee on Thursday raised this fiscal year’s one-time estimates by about $17 million and raised ongoing estimates by about $30 million.
A 1 percent inflationary increase would cost about $24.8 million, leaving about $5 million in ongoing revenue, according to a reporter’s question at the press conference.
Rhoden said he has no preference for what the leftover money would go toward.
“When you get into those smaller numbers, I’ll leave that in the hands of the legislature,” Rhoden said.
One-time dollars for legislative priorities
On the one-time dollars, Rhoden said he’s not advocating anything specific be done with them.
In his original budget, Rhoden recommended the state leave 12.5 percent in reserves and use everything above that for one-time money. That included an extra $14 million to focus on legislative priorities that he left on the bottom line.
Rhoden said he’d advocate that lawmakers also include the additional $17 million for their priorities or opt to leave that on the bottom line.
Lt. Gov. Tony Venhuizen said the House and Senate caucuses are working among themselves to prioritize spending ideas.
Rhoden said his ability to work with legislators and their open line of communication so far this session has encouraged him.
