South Dakota Gov. Larry Rhoden said the state closed the 2025 fiscal year with a budget surplus of $63 million.
The surplus included $41 million in higher-than-expected revenue and $22 million in spending below what was budgeted, officials said Monday.
“South Dakota is a leader in our nation – especially when it comes to disciplined financial management,” Rhoden said. “We will continue to be careful stewards of taxpayer dollars by making wise long-term investments, maintaining conservative fiscal policies, and only spending within our means.”
The state actually saw less sales tax revenue expected, finishing $3.7 million below estimates. But that was offset by over $47 million of revenue from unforeseen unclaimed property receipts. Last session, lawmakers passed a bill dedicating unclaimed property windfalls to a trust fund starting in fiscal year 2026.
Also during last session, Rhoden and legislative leadership agreed to keep $106 million left unspent to help cover the costs of a future prison. Between the $63 million surplus and the $106 million left unspent by the Legislature, $169 million will flow to the state’s two primary reserve funds, which is required by state law. The state’s reserve funds now total $492 million.
The Bureau of Finance and Management also published a document Monday highlighting South Dakota’s fiscal accomplishments.
“South Dakota’s disciplined financial management, low debt levels, conservative budgeting practices, AAA credit rating, and fully funded pension system helped achieve our distinction as a leader in fiscal strength,” said Bureau of Finance and Management Commissioner Jim Terwilliger.