Politics & Government
South Dakota received ‘B’ for fiscal health
According to Truth in Accounting's new Financial State of the States report
A new report on the financial condition of the 50 states ranked South Dakota no. 5 for its fiscal health in fiscal year 2020. The report found that the majority of the states were ill-prepared for any crisis, but South Dakota had some funds available to help them weather the crisis.
The analysis by Truth in Accounting, a non-profit government finance watchdog group, found South Dakota had $5.3 billion in assets available to pay future bills. This surplus equates to $5,200 for each state taxpayer.
South Dakota was one of the 11 states that had a Taxpayer Surplus™ at the end of the fiscal year 2020, which is a calculation of the state’s available assets divided by the number of taxpayers. These states were financially sound before and during the pandemic, yet they still received federal support from COVID-19 related grants. The federal aid came with stipulations on how the money could be spent. The surplus these states had, as well as the additional funds, may help them weather any future public health or economic crises and downturns in the market, which can cause the value of a government’s assets to fluctuate. The uncertainty surrounding this current crisis makes it impossible to determine how much will be needed to maintain government services and benefits.
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According to the watchdog's twelfth annual Financial State of the States report, South Dakota had $3.8 billion in bills and $5.3 billion in available assets to pay those bills after capital and restricted assets were excluded. This resulted in a $1.5 billion surplus, or a $5,200 Taxpayer Surplus, which is each taxpayer's share of the state surplus after bills have been paid. TIA's Taxpayer Surplus indicator incorporates both assets and liabilities, including unfunded retirement obligations.
South Dakota hypothetically could write a check for $5,200 to each of its taxpayers after paying all of its bills, which is why it received a "B" grade for its fiscal health.