Committee on Appropriations A/V — 2019

*If you are unable to view the video, please update your browser.
DescriptionJump To
Roll00:01:00
Introduction of Pages00:01:50
Ms. Liza Clark, Commissioner, Bureau of Finance and Management (BFM), presented Budget Overview of Governor Noem's FY20 Budget - Page 100:03:00
Bureau of Finance and Management Budget Team - List - Page 200:04:08
Presentation Overview - Agenda - Page 300:05:10
Budget Process - Calendar Year Process - Page 400:06:00
Representative Hunhoff - question - how does the Governor transfer power and does the new Governor meet with state agencies.00:07:01
Revised FY19 Revenue Estimates - Page 5 00:09:45
Ongoing Revenue Estimates: FY19 - Sales and Use Tax, Lottery, Contractor's Excise Tax., Insurance Company Tax, Unclaimed Property, Licenses, Permits, & Fees, Tobacco Taxes, Bank Franchise Tax, and Remaining Ongoing Revenue - Adopted FY19 $1,641.5M and Revised FY19 $1,641.9M - Page 600:09:55
Mr. Jim Terwilliger, Bureau of Finance and Management Economist, met with the committee to give an overview of ongoing revenue estimates.00:10:00
Senator Nesiba - question - why doesn't this chart match Governor Noem's Budget Summary Book referring to Page 1500:14:44
One-Time Funds in FY19 - Reduced Revenue and Reduced Expenses - Increased Ongoing Revenues versus Adopted, Transfer from Reserves more than 10%, One-Time Increased Receipts, Reduction of Annual Appropriations - FY19 Total $44,724,192 - Page 700:16:09
Senator Maher - question - where are the One-Times Funds listed in Governor Noem's Summary Book.00:18:14
Senator Partridge - question - how does the Bureau of Finance and Management determine when excess reserves transfer into the general fund.00:19:10
Senator Partridge - question - when will excess revenue reserves figures be finalized. 00:20:16
Representative Hunhoff - question - what is the difference between revisions and budget cuts (referring to Page 46) of Governor Noem's Budget Book and are these revisions not being reallocated to the FY19 budget.00:20:54
Representative Bartels - question - referring to Page 13 - what is included in the Reduction of Annual Appropriations - $34,683,60100:22:10
FY20 Revenue Estimates - Page 800:23:09
FY19 Adopted versus FY20 Recommended Ongoing Receipts - Total Ongoing Receipts are estimated to increase $54.2M - Page 900:23:23
Mr. Terwilliger indicated challenges to the economy include agriculture and the federal government shutdown.00:26:48
Senator Partridge - question - would you give an update how the agriculture sector is doing.00:27:24
Mr. Terwilliger said farm machinery purchases have been stable.00:28:51
Senator White - question - what is the tobacco tax trend and how does this compare to surrounding states.00:29:43
Mr. Terwilliger thinks tobacco sales will decline over time.00:30:00
Representative Koth - question - does the agriculture sector contribute to the Contractor's Excise Tax forecast.00:31:17
Sales Tax Reported by Remote Sellers - Current Year, Previous Year, and Change - Change from December 2017 to December 2018 - $1,395,084 - Page 1000:34:46
Mr. Terwilliger emphasized sales tax reported by remote sellers isn't 100% accurate and explained reasoning.00:36:30
November 1, 2018 is the first month the remote sales tax from the Wayfair Supreme Court decision came into effect. Mr. Terwilliger said businesses need a month to report sales.00:38:34
Senator Partridge - question - does BFM have information from December remote sales data.00:40:40
Representative Peterson - question - what is the total remote Sales Tax Reported by Remote Sellers for the year.00:41:45
Representative Bartels - question - how much remote sales tax has been remitted by new remote sellers since November 1, 2018 and requested additional information.00:42:15
Representative Bartels - question - how many new licenses have been registered since the Wayfair Decision and requested additional information.00:43:43
Representative Howard - question - is the remote sellers sales tax total $1,395,084 sales since November 1, 2018.00:45:20
Commissioner Clark said the remote sellers sales tax is $1,395,084 since November 1, 2018 and the general appropriations act adopted last year estimated the figure to be $1,107,138. This $1,107,138 has already been earmarked.00:46:00
Senator Nesiba - question - how much sales tax revenue is from remote sellers and how much is from brick and motor sellers. Senator Nesiba suggested upgrading accounting software to track this information. 00:46:50
Mr. Terwilliger said currently there isn't statute that requires businesses to break out sales tax in remote or brick or motor detailed categories.00:49:18
Senator Wiik commented that the remote sales tax and Senator Partridge's amendment will be debated.00:49:46
Representative Karr - question - would you interpret what constitutes a remote seller when physical property enters the state. Representative Karr gave Netflix as an example.00:50:02
Mr. Terwilliger encouraged the committee to email specific questions and he will have his staff interpret how the department determines what constitutes a remote seller.00:51:45
One-Time Funds in FY19 - Reduced Revenue and Reduced Expenses - $44,724,192 - Page 700:53:10
FY19 General Bill Expense Reductions - Page 700:54:00
Department of Social Services Utilization - Decrease of $19,832,331 in general funds - Medical Services, Child Care Direct Assistance, Human Services Center Federal Revenues, Juvenile Justice Reinvestment Initiative (JJRI) - Page 1100:54:40
Commissioner Clark said there has been a drop of 1,795 Medicaid and CHIP eligible from FY18 December to FY19 December. This decline wasn't expected and is most likely from the improved economy.00:56:23
Representative Hunhoff - question - are Native Americans included in medical services and are they included in these statistics.00:57:51
Representative Hunhoff - question - how did you determine how many people are eligible for Medicare benefits at the Human Services Center. 00:59:11
Care Coordination Agreements - Decrease of $6,843,582 in general funds. - Page 1501:00:14
Representative Hunhoff - requested Department of Social Services bring a breakdown of care coordination agreements01:00:58
State Aid to Education Revision - Decrease of $6,903,895 in general funds - Page 1601:01:25
Statewide Various Decreases - Decrease of $1,103,793 in general funds - Utility Adjustments, Department of Corrections Operations, Department of Human Services Operations, and Legislator Pay Changes - Page 1701:02:00
Representative Howard - question - was the decrease in the Department of Corrections Operations costs from a reduction of juvenile's in the correction system.01:03:15
Representative Hunhoff - question - why is legislator pay less than expected.01:04:09
Summary of Recommended FY19 One-Time General Funds Expenditures - Page 1801:05:22
FY19 Emergency Special Appropriations - List - Page 2001:05:43
Jameson Prison Annex Expansion - Increase of $7,392,235 in general funds - Page 2101:05:48
Provider Innovation Grants - Increase of $6,000,000 in general funds for nursing home grants and primary and prenatal care grants - Page 2201:06:56
National Guard Readiness Center - Increase of $3,884,885 in general funds - Page 2301:09:40
Extraordinary Litigation Fund - Increase of $2,300,000 in general funds - Page 2401:11:05
Senator Maher - question - how many years will the State of South Dakota purchase land around Ellsworth Airforce Base and requested additional information01:12:28
Ellsworth Air Force Base Readiness Environmental Protection Initiative Program (REPI)- Increase of $1,845,000 in general funds - Page 2501:12:38
Senator Partridge gave an update what the South Dakota Ellsworth Housing Authority has done to fulfill the requirements of the REPI Program.01:14:20
Metrology Lab - Increase of $1,660,000 in general funds to renovate a building in Sturgis. - Page 2601:15:15
Representative Bartels - question - did you consider future operating costs when the State Metrology Lab is moved to Sturgis.01:17:39
Senator Greenfield - question - would you provide a list of service providers that use the State Metrology Lab.01:18:20
Second Century Pheasant Habitat - Increase of $1,000,000 in general funds - Page 2701:18:44
Representative Koth - question - who and how will the Second Century Pheasant Habitat Fund be managed.01:19:18
Senator Maher - question - why isn't the Second Century Pheasant Habitat under Game Fish & Parks and who will benefit from this fund and requested additional information.01:19:49
Senator Nesiba - question - do some of these funds go through the South Dakota Community Foundation01:20:30
Senator Wiik - question - will Second Century Pheasant funds be released after private funds are raised.01:21:24
Rural Healthcare Recruitment Assistance - Increase $979,849 in general funds - Page 2801:21:48
Representative Koth - question - is this proposal to the rural healthcare recruitment assistance program new and how does this program operate.01:23:10
Senator Greenfield - comment - gave a history of the rural healthcare recruitment assistance program.01:24:30
Fire Suppression Fund - Increase of $906,658 in general funds - Page 2901:26:55
Veteran's Bonus Program - Increase of $600,000 in general funds - Page 3001:28:15
Emergency and Disaster Fund - Increase of $550,596 in general funds - Page 3101:29:25
Elm Lake Dam - Increase of $521,403 in general funds - Page 3201:30:20
Senator Maher - question - what is the difference between the Richmond Lake and Elm Lake Dams and which lake provides water to the City of Aberdeen.01:31:30
Senator White responded that Richmond Lake is closer to Aberdeen and Elm Lake is closer to the North Dakota border and Elm Lake is the water source for the community.01:32:05
Palisades State Park - Increase of $500,000 in general funds - Page 3301:32:30
Tax Refunds for Elderly and Disabled Persons - Increase of $450,000 in general funds - Page 3401:33:43
Senator Nesiba - question - is the program for the Tax Refunds for Elderly and Disabled Persons reviewed annually and does this fund qualify as a Special Appropriation.01:34:20
Introduction of Pages01:35:55
Representative Karr - question - is it possible for Futures Funds to be used for Special Appropriations such as pheasant habitat and purchasing land around Ellsworth Airforce Base.01:36:40
FY19 General Bill Amendment General Fund Increases - Page 3501:37:26
Rural Broadband Expansion - Increase in $5,000,000 in general funds - Page 3701:39:10
State Radio Infrastructure and Systems Upgrade - Increase in $4,620,920 in general funds - Page 3801:39:50
Senator Maher - question - how does money get earmarked and will this appropriation for state radio be remembered in the year 2023.01:40:40
Senator White - question - has the State of South Dakota communicated with the counties and cities what the expectations are for state radio upgrades.01:40:51
Senator Maher - comment - how earmarked money is processed in the State of South Dakota.01:41:45
Senator White - question - are rural areas aware of state radio cost requirements and has the State of South Dakota communicated with rural areas in regarding State Radio Infrastructure requirements.01:42:25
Senator Nesiba commented he would like to see grants available for state radio infrastructure in rural areas.01:43:40
Provider Rate Increases - Increase in $3,776,805 in general funds - Page 3901:44:08
Representative Hunhoff - question - were all provider rate increases for behavioral health used in FY19.01:45:35
Handout - FY20 Provider Rate Adjustments - Due to Savings from Care Coordination Agreements - $4,290,028. This handout does not include discretionary provider inflation.01:46:10
Representative Hunhoff - question - would you provide additional information for provider rate increases, and what was the plan from last year for community support providers, and how does this relate to the current Care Coordination Agreements.01:47:40
Representative Koth - question - how does this provider rate increase proposal relate to what has been done in the past.01:48:35
Representative Hunhoff - question - how did you determine the 90% level, what year did you base your analysis, and requested additional information.01:50:30
Representative Bartels - question - why doesn't the executive branch use administrative authority and give provider rate increases without going through the legislature.01:50:50
Senator Nesiba - question - what base did you use to determine the 2.5% inflation increase.01:52:15
Methamphetamine Prevention Campaign - Increase of $1,375,000 in general funds. - Page 4001:54:15
Statewide Various Increases - Increase of $1,335,000 in general funds - $426,103 Bureau Billings Pool, $358,742 Dual Credit Enrollment, $150,000 Matching Funds for HAVA Grant, $107,406 Attorney General Operations, $100,000 South Dakota Development Authority Resource Conservation & Forestry, $81,505 Technical Institute Revision, and $11,244 Civil Air Patrol - Page 4101:55:55
Senator White - question - does the HAVA grant bring all counties in compliance with federal law.02:00:25
Summary of Recommended FY19 One-time General Funds Expenditures - Chart - Page 4202:00:37
FY20 Ongoing Revenue Projections - Page 4302:01:05
FY19 Adopted versus FY20 Recommended Ongoing Receipts - Page 4402:01:10
FY20 Ongoing General Fund Recommendations - Page 4502:01:18
FY20 Recommended Expense Overview - Major Increases/Decreases - $54,132,719 - Page 4602:01:22
Provider Inflation - $19,211,130 - Page 4702:01:40
State Aid - State Aid to General Education, Technical Institutes Formula, Technology in Schools, Sparsity totaling $11,160,327 - Page 4802:03:15
State Employee Salary Policy - Increase of $9,567,792 - Page 4902:04:35
Department of Social Services and Department of Human Services Consumer Expansion - Social Services $4,891,794 and Human Services $3,755,816 totaling $8,647,610 for mental health services. - Page 5002:05:25
Representative Hunhoff - question - is the Department of Education federal grant funding included in these figures.02:07:00
State Employee Health Insurance - Increase of $8,597,854 in general funds - Page 5102:07:27
Maintenance and Repair - Increase of $4,928,770 in general funds. This figure will maintain the 1.76% for maintenance and repair. - Page 5202:08:49
Methamphetamine Prevention and Treatment Services - Increase of $3,258,002 in general funds, $1,525,800 meth treatment, $731,281 school-based meth prevention, $547,500 alternative care programs, $250,0000 meth prevention campaign, and $203,421 Meth Interdiction DCI agents - Page 5302:09:56
Senator Nesiba - question - are there other funds that will help augment the Meth Prevention and Treatment Services plan.02:11:15
Senator Maher - question - is this funding ongoing or one-time money for Methamphetamine Prevention.02:12:18
Representative Hunhoff - question - what agency budget will the meth prevention and treatment services funds be placed. 02:12:55
Representative Hunhoff - question - how to do you determine who is eligible for Medicaid in the criminal justice initiatives and indicated the explanation is confusing.02:14:25
Medicaid Revisions - Social Services ($10,544,426) and Human Services ($1,792,876) totaling ($12,337,302) - Page 5402:15:10
Bottom Line FY19 and FY20 - Page 5502:17:20
Announcements02:18:40
Approval Minutes - January 14, 2019 Sutton/Bartels02:18:55
Adjourn Bartels/Sutton02:20:00

Click message to listen