South Dakota Ends Fiscal Year with $69 Million Surplus

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FOR IMMEDIATE RELEASE

July 13, 2026

Contact: Josie Harms

South Dakota Ends Fiscal Year with $69 Million Surplus

PIERRE, S.D. - Today, Governor Larry Rhoden announced South Dakota closed the state fiscal year 2026 budget with a surplus of $69 million.

"South Dakota's robust economy is driving steady revenue growth, moving our budget in an even stronger direction," said Governor Larry Rhoden. "We keep our taxes very low and ensure we have the highest return on each dollar invested. We're setting an example for the nation of good stewardship of taxpayer dollars by doing things the right way, the South Dakota way."

The surplus included $30 million in revenue above estimates. It also includes $39 million in spending reversions, meaning state agencies spent less than they were budgeted, a sign of strong fiscal responsibility.

Sales tax revenue growth accounted for $17 million of the surplus, a strong indicator of a growing economy. In FY2026, Sales tax grew 6.6% compared to fiscal year 2025, significantly higher than historical average growth of 4.7%. The largest area of unspent funds came from the Department of Social Services, totaling $32 million.

"In South Dakota, we adhere to basic principles of financial discipline: we don't spend money we don't have; we balance the budget every year; we avoid debt by saving for one-time investments; and we maintain a fully funded pension system," said BFM Commissioner Jim Terwilliger. "Our strong fiscal year end result is another example of why South Dakota maintains the highest possible credit rating from three independent rating agencies."

Per state law, the $69 million surplus was transferred to the state reserve funds, which now totals $325 million, or 12.7%, of the FY2027 budget and will be available for one-time investments in future budget years.

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