PIERRE, S.D. – The State of South Dakota closed the state fiscal year 2026 budget with a surplus of $69 million.  

According to a press release from the governor’s office, 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.

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

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