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Olson: Governor has support for budget cuts
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By: CHUCK CLEMENT, Staff Reporter
| 01/20/2011 |
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Sen. Russell Olson (left) speaks with John Goeman of Madison after a luncheon held Tuesday at the Ramkota RiverCentre in Pierre.
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To deal with a shortfall in the hundreds of millions of dollars, Gov. Dennis Daugaard proposed budget cuts of at least 10 percent for the state departments and agencies that fall under his control. Olson, R-Dist. 8, said that "10 percent across-the-board-cuts appear to be a good idea under the current circumstances."
Daugaard told the joint assembly of legislators that he planned to reduce the state's general fund spending by $127 million to balance the fiscal year 2012 budget.
Olson noted that Daugaard had cut the salaries of his top staff members and department heads by about 10 percent and reduced his own salary by 15 percent.
The governor also wants to stop the practice of providing one-time funding from the state to certain programs. Daugaard also has significant support for protecting the $107 million that the state has in ready reserves, according to Olson.
"He wants to hold onto the idea that you don't use your reserves for ongoing expenditures in the state budget," Olson said.
Daugaard committed himself to not increasing taxes, promising to veto any bill that would increase the state's revenue intake.
As a partial solution to the state's budget woes, Daugaard will seek opportunities in economic development. Olson said Daugaard's commitment to growing South Dakota's economy was exemplified by making a new economic development cabinet post.
"It lifts those programs to higher visibility and speaks volumes for the governor's intent to growing our economy," Olson said.
During his first week as governor, Daugaard attended a ribbon-cutting ceremony in Redfield for a new sunflower hulling and processing plant. Current estimates predict that the plant will provide about 34 new jobs. Some of the funding for the $3-million plant was provided by a loan from the state's Revolving Economic Development and Initiative (REDI) fund.
Olson said Daugaard had already worked with South Dakota's ethanol producers to re-amortize the incentive support they had received so that other businesses could obtain economic development loans.
"The REDI fund is a big draw for businesses wanting to open their shops in our state," Olson said. "The agreement with the ethanol industry may have a $10 million effect over the next five years."
Olson said the ethanol producers were encouraged to make the adjustment with a proposal from the state to provide financial support for fuel retailers to install more ethanol blender pumps.
"The (ethanol) producers were part of the program when the state went to them and asked, `What can we do to help each other'?" Olson said.
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