South Dakota More Reliant on Federal Dollars Than Minnesota

As Donald Trump gets ready to release the full ugly of the frightful budget framework his White House spat out two months ago, Mike Maciag of Governing reviews the Census Bureau’s 2015 Annual Survey of State Government Finances and finds that the states depend on the federal government for nearly a third of their general funds. How does South Dakota’s federal dependence stack up?

Federal Share of FY15… General Fund Public Welfare (excluding school lunch and WIC) Education Roads
US 63.9% 13.0% 34.4%
SD 35.1% 58.7% 17.6% 49.6%
MN 27.2% 62.1% 9.6% 21.2%
IA 32.0% 65.8% 15.1% 23.6%
NE 29.8% 82.0% 5.1% 40.1%
WY 33.5% 50.5% 20.4% 67.3%
MT 39.1% 78.8% 14.7% 64.4%
ND 18.4% 63.5% 11.2% 23.7%

We tie with Alabama for 12th-highest percentage of general fund made up of federal funds. In Fiscal Year 2015, South Dakota state government paid 64.9% of its own bills. Minnesota paid 72.8% of its own way. The liberal bastions of California, Illinois, and Massachusetts all base lower percentages of their state budgets on federal funds than does South Dakota.

Among the six states bordering South Dakota, only Montana relied on Uncle Sam for more of its budget that we did. We actually pay a smaller percentage of our welfare budget with federal money, but we are the second-most reliant state on federal education dollars and the ninth-most reliant on federal road dollars.

Hmm… those figures don’t make self-reliance look like a uniquely South Dakotan value.

16 Responses to South Dakota More Reliant on Federal Dollars Than Minnesota

  1. Pfft and SD calls MN a welfare state, smh. SD just wants to pretend they’re a self-reliant state.

  2. Porter Lansing

    South Dakota has a welfare budget? I thought poor, senior and disabled people just get a bus ticket to Minnesota. They’re surely not shown any of the “South Dakota Nice”.

  3. Mr. Lansing, let us not confuse the elderly or the disabled persons who are able to support themselves without welfare beyond the pension systems into which they have paid. We do not want to deport them on a bus to Minnesota if they do not want to go. Colorado, now, might be a different story. More might go. Iowa, they are flocking here from Iowa.

  4. South Dakota thinks it can’t keep up with everyone else because it’s an Ag state – as if Minnesota wasn’t an Ag state before they de-conservatized their public policies to become more centered around growing a population with a diversified economy.


  5. Maybe South Dakota can isolationize its way through all its comparative failures.


  6. Better yet, let’s start trucking in waste from other states (to put it here) [for tax revenue] so that we don’t have to do anything different in the short term to solve our budget woes.

    Heck, a few other states do it, why don’t we? Canada has a lot of waste that they are willing to pay great money for someone else to bury it somewhere else. Let’s have a deep conversation about the benefits of all that money they would pay us – and the jobs [dont get me started on the oh so very many jobs] – instead of diversifying our economy with a longer term strategy.
    [sarcasm galore]

  7. Robert McTaggart

    So you wouldn’t accept waste from solar or wind or gas development?

    Waste is a reality that has to be dealt with. You can try to reduce it before it is produced and recycle it to extract resources, but there is always something that is left over. It is both a problem and an opportunity.

    But if you are going to accept waste and take the paycheck, I agree there should be other things that come with it. Such as recycling, industries that use the by-product as a resource or are powered by said resources, and other types of manufacturing to diversify the economy.

    What about biobased products that also incorporate resources from waste streams?

  8. Robert McTaggart

    Yeah, let’s keep allowing the opportunities to go elsewhere.

    “The next step for the company, says Julia, is to start recycling solar panels. “Rooftop solar panels are big business in Germany at the moment. But after 20 years, the panels are scrap,” she explains. “Somebody has to do something with it. We want to try to save the glass because it’s very expensive and very hard to produce and there’s also silver in solar panels that we want to recycle.” “

  9. Don Coyote

    @cah: Just following the Constitution and the 16th Amendment Cory.

    “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States,…”

    The apportionment of taxes you and others are advocating is an absurdity brought on by the highly progressive income tax championed by the faulty reasoning of you, liberals and statists.

    It is impossible to apportion income taxes by population since state tax bases are inconsistent on a per capita basis. With apportionment, tax rates would have to be higher in poorer states or in states with a small per capita tax base but that would violate the Constitution’s Uniformity Clause.

    One way to achieve an uniformity in tax liability among the states would be to revert to the requisition system used under the Articles of Confederation which would allow the individual states to adopt taxation systems that would best allow them to determine how to collect their contribution.

    If you desire a progressive income tax then liberals, statists and you need to accept the imperfections of your system and to stop politicizing the absurdities caused by the very system you advocate for.

  10. Ah, Coyote and his grautitous red herrings.

    Statists? Isn’t everyone who prefers a social contract to the state of nature a “statist”—i.e., advocating for a state to prevent anarchy?

    Coyote’s argument has nothing to do with the 16th Amendment or “poorer states” and everything to do with state funding priorities. South Dakota’s per capita income in 2015 was slightly above the national median (i.e., better than half the states), yet South Dakota had the second-highest proportion of federal funding in its education general fund. South Dakota could choose to foot more of its own bill for roads, education, and other state programs. South Dakota chooses instead to rely less on itself and more on the federal government.

    I don’t know what argument Coyote is making, but it’s not an argument against the thesis of this blog post.

  11. To be clear, Robert, I proposed that we turn much of our unused prairie into waste dumps of any and all kinds of waste as we could get paid for it, and then pay our teachers more, and then we could afford to give sweetheart tax breaks to corporations – as bribery to move jobs here – because if we are gonna catch up with our country, it’s gonna take some bribery/insentives just to get the ball rolling.

    All we gotta do is start trucking in medical and industrial waste from other states, and we’ll be rich. Liberals just don’t understand how good pollution is.

  12. Darin Larson

    Cory, if you set aside the “extra” money that video lottery is supposed to be providing to education, I assume SD easily climbs to number 1 in its dependence upon federal dollars for general fund education spending. I say extra money from video lottery because we were sold on the prospect of video lottery that the state’s share of the revenue would go to state education funding. Thus, in theory, this money should be on top of the state’s regular level of contribution to education. This should mean that SD robustly funds its educational system. We all know that is not the case. Instead, the video lottery money was used to free up money for other state expenditures. Looking at it another way, video lottery was simply another tax that was justified on the basis it would help strengthen our educational funding, but was instead used for other purposes. Who says Republicans don’t like imposing taxes on our citizens? They seem to love other forms of tax like state gambling revenues which target addicts and those which transfer societal costs primarily to local government.

  13. Cory, Gov Daugaard brags on in his speech you highlighted above and says that SD pays its bills (as if other states don’t). When did SD pay back the millions to the Feds from the EB-5 and GOED scandals? Yeah, I didn’t think so….and will SD ever be billed for that lost money?

  14. I meant the EB-5 and Gear Up corruption scandals

  15. McTaggert’s borehole just died, and that’s what you get for putting all your economic job creating eggs in the Federal government’s basket, Doc.

  16. And just because I am that kind of guy, I just want to say, I called Trump’s killing of this borehole – back in December on this blog. ;)