South Dakota lawmakers are reviewing nearly $ 39 million in unspent state funding from the fiscal year that ended June 30, a major factor in the state’s recently announced $ 69 million budget surplus.
The largest share came from the Department of Social Services, which returned about 32 million dollars from its budget. State budget officials say much of that came from lower-than-expected spending on Medicaid and other assistance programs, where costs can be difficult to predict from year to year.
Commissioner Jim Terwilliger told lawmakers that programs such as Medicaid depend on enrollment levels and healthcare needs, making budgeting challenging. Medicaid enrollment declined slightly during the past year, contributing to some of the unused funds.
Officials also cited lower utilization of mental health and substance abuse treatment services, along with staffing shortages at treatment facilities, including the Human Services Center in Yankton.
Lawmakers offered differing views on the surplus. Some praised the lower demand for assistance programs, while others stressed the importance of ensuring residents still have access to services that help them achieve long-term self-sufficiency.
Looking ahead, state economists are split on revenue forecasts for the current fiscal year, with some predicting modest growth and others urging caution after stronger-than-expected tax collections last year.
