From the Desk of Commissioner Kippley: Budget process looks out 5-10 years

My colleagues and I have started our budget hearings to establish a 2024 budget. The County Commission must pass a preliminary budget by July 30 with a final budget adopted by October 1. As a new commissioner, I have been impressed with the work that all county leaders have done to keep their expenses in line with limited revenues. I am also pleased that we are taking a broader outlook than just 2024 and looking out 5-10 years to plan for future challenges.

The county budget “fiscal year” follows the calendar, starting January 1 and ending December 31. The initial budgeting begins as outside agencies that provide key services to the county present to the commission on their organization, its work, and where that work fits within the environment of Minnehaha County. County departments also present to the commission, providing updates on key goals and objectives used to accomplish their goals in the previous budget year and what the department’s goals are for the upcoming fiscal year. These presentations are crucial for both the commissioners and the public, giving each department time to show the added value they provide to our community through their work. 

Late spring and early summer is when the hard financial work begins. Departments are tasked with submitting their budgets, equipment requests, staff requests, and long-range plans. Balancing the needs of each department with the overall availability of revenue is difficult. Counties can only increase their property tax revenue by 3 percent or the consumer price index (whichever is less). Over the past few years, the consumer price index has far exceeded three percent, which means that while our expenses have increased, the county’s ability to raise revenue equal to those expenses has not been able to keep up. This restriction means that the Commission must take care to encourage innovative methods for increasing efficiency and effectiveness, while not increasing costs beyond our means.

Since 2017, public safety (law enforcement, courts, and legal) has averaged 67 percent of the total general fund expense budget. As our county continues to grow the County is responsible for making sure that our high-standard of public safety is maintained.  Counties are unique in that what we choose to spend money on is not really our choice. The State of South Dakota requires counties to provide a number of functions to our citizens. These requirements make up 88 percent of the 2023 budget. With limited revenue potential, unfunded mandated expenses, and a commitment to maintaining our excellent quality of life, the budget process takes center stage for Commissioners as we work to keep Minnehaha County a wonderful place to live and work. 

We will watch the state legislature’s summer study related to County finances closely to see if the state can ease any county burdens or otherwise help with property tax relief. We will responsibly wind down our use of federal funding that came in during the pandemic to manage the county’s role without major cuts in services or rapid spikes in property taxes. To govern is to choose, and all choices involve various tradeoffs. There are no perfect answers, but trust that my colleagues and I take seriously our role as fiscal stewards for Minnehaha County.