PIERRE, S.D. (KELO) — A legislative subcommittee spent several hours Wednesday night setting revenue forecasts for South Dakota state government.
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The 10 lawmakers, all members of the Joint Committee on Appropriations, agreed to recommend that an estimated $2.460 billion of ongoing general receipts will flow into the state general fund during the fiscal 2026 year that starts July 1.
That was $4 million less than the Legislative Research Council forecast but $24 million more than the forecast from the governor’s budget office.
The vote was 10-0. The motion came from Republican Sen. Taffy Howard.
“I honestly believe it’s a good compromise,” she said.
The subcommittee also unanimously recommended a revised 2025 general fund amount of $2.391 billion from ongoing general receipts. That was down from the $2.420 billion for 2025 that the Legislature had adopted last February.
All 18 Joint Committee on Appropriations members will consider the subcommittee’s recommendations on Thursday morning.
They were using estimates that appropriators had received on Wednesday morning from the governor’s Bureau of Finance and Management and the Legislative Research Council’s budget staff.
LRC deputy director Jeff Mehlhaff, who is the Legislature’s chief fiscal analyst, and state economist Derek Johnson from BFM presented their agencies’ forecasts for the remainder of fiscal 2025 and projections for the new 2026 fiscal year that starts July 1.
The subcommittee’s 2026 estimate came after the five senators and five representatives had reached agreement on how much they expect during the four-plus months left in the current 2025 fiscal year.
BFM and LRC were extremely close on estimating the 2025 ongoing receipts. But they were roughly $20 million apart on the amount of one-time revenue from unclaimed property that will be available: BFM forecast $186 million while LRC was at $166 million.
Republican Rep. Mike Derby, the House appropriations chair, wanted the subcommittee to recommend $186 million. But Sen. Howard didn’t want to go that high. State government is forever liable to pay all legitimate demands for unclaimed property, and Howard asked what would happen if those came in for more than expected.
“I just don’t think it’s wise for the taxpayers,” Howard said. The committee split 5-5 — House yes, Senate no — on Derby’s attempt. Howard then proposed they take the average of the BFM and LRC numbers.
“They’re both good estimates. They both do outstanding jobs. We’re better off taking the average of the two,” she said.
That went through 10-0.
