South Dakota Governor Dennis Daugaard wants to give a three-percent increase to South Dakota school districts, medical providers and state employees in his next budget.
The proposal was made during Daugaard's annual budget address Tuesday afternoon in Pierre.
Those increases are happening because Daugaard says there is nearly $100 million in ongoing revenue that will be available to the state because the economy here is doing better than other states. But the governor is urging caution despite the millions the legislature will have to spend this session.
Daugaard says because of tough cuts two years ago and a conservative approach, South Dakota's budget is in good shape.
"By making cautious decisions and applying South Dakota common sense, we're building our state for the long term," Daugaard said.
Because of a projected increase in sales tax and overestimates from last year's budget, Daugaard says the state will have about $96 million in ongoing revenue available and that's why school districts, medical providers, state universities, technical schools and state employees all stand to get a three-percent increase in the next budget.
Democrats say it's not enough money, while Republicans are pleased with the proposal.
"If the voters said anything in every forum we had, they talked about Medicaid and our K-12 system, so I'm glad to see they both have a proposed increase of three percent and I'm sure the conversation over the next three months is going to include more money for them," Senate Majority Leader Russell Olson of Wentworth said.
"Today I felt like I came to a football game and nobody brought a football. We didn't get to the real heart of the matter, which is how do we make up that huge shortfall, that huge hole we dug for K-12 schools? We never really came up; not even an acknowledgement that there was a problem," House Minority Leader Bernie Hunhoff of Yankton said.
But Daugaard says while South Dakota is on solid financial footing, he wants lawmakers to continue to take a conservative approach to the budget during the upcoming session.
"In South Dakota we know that we have to keep our state structurally sound for the future. That's my focus this year. I hope you'll join me in that focus," Daugaard said.
The state will have $26 million in one-time money available to spend this session as well. It will be up to lawmakers to figure out how to divide that up, but the real key will be if the legislature will have to use that money to plug federal budget cuts because of the fiscal cliff. They will know that answer when they come back here to Pierre in January.