South Dakota to Spend 0.73% Less in FY2018… and Some Education Funding Notes!
|Daugaard proposal||Daugaard %||Approved budget||Approved %|
Assuming Donald Trump doesn’t throw us into default, the federal government will provide just about 36 cents of every dollar South Dakota state government spends. Our sales tax, property tax, bank income tax, and other taxes will provide just about 35 cents; our fees collected by state government kick in the remaining 29 cents.
Over seven budgets, Governor Daugaard and the Legislature have made some progress in reducing our dependence on federal funding. Daugaard got 41.65% of his first budget from Uncle Sam, while supplying only 31.84% of the budget from state general funds. Daugaard decreased the federal share and increased the state share to the point that, in his FY2015 and FY2016 budgets, the general fund was larger than federal funding. Federal funding jumped back into the lead in the current budget and holds that lead in FY2018:
|each fund as percentage of total state budget|
My FY2017 includes the $37.6 million net cut in the current budget imposed by Senate Bill 32. The FY2018 budget actually spends $33.4 million less than that reduced FY2017 figure, a 0.73% cut, thanks to decreases in federal and other dollars outweighing the increase in general fund dollars. Let’s hope that 0.73% decrease gives Senator Nelson and his fellow smaller-government advocates some solace.
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Looking strictly at general funds, we can see that the FY2018 budget is the first time that Governor Daugaard will invest a larger share of the state’s general funds in K-12 education than his predecessor did in his last term:
|General||K-12 State Aid||K-12 as percentage of general fund|
Even in the current budget, flush with the Blue Ribbon sales tax boost for teacher pay, South Dakota is spending a smaller percentage of its general fund on K-12 education that it did in the 2011–2012 school year.
Six years ago, Governor Daugaard whacked K-12 education with a 10.92% cut in state aid in his first budget, the FY2012 correction of the Rounds deficit. The overall FY2012 budget slashed federal funding but increased general and other funds. As we can see in the table below, general fund spending rose 0.14% in the FY2012 austerity budget. State aid to K-12 education thus seems to have borne a disproportionate amount of that year’s austerity.
|Change in general fund over previous year||Change in K-12 state aid over previous year|
|annualized rate of increase since FY2011||4.64%||4.86%|
Since then, Governor Daugaard and the Legislature have helped K-12 make up for that lost ground. They have increased K-12 spending at higher rates than the state general fund increases in four out of six budgets, including the FY2018 budget. All together, the seven Daugaard budgets have increased state aid to K-12 education at an annual rate of 4.86% while increasing total state general fund expenditures at an annual rate of 4.64%.