PIERRE, S.D. (AP) — Gov. Kristi Noem said Monday the state will have sufficient room in its budget to launch an industrial hemp program and to raise pay for teachers and state employees.

The Republican governor said that increases in tax revenue and cuts to other programs will provide enough money to give a 2% bump to funding for pay increases. Noem will also get the $3.5 million she says is necessary to “responsibly" start an industrial hemp program. With the support of Republican legislative leaders who control the statehouse, the announcement clears up several outstanding disputes as the session nears its conclusion this week.

Noem told reporters that she has asked state agencies to tighten their budgets to clear room for the other items. Some of the money will come from programs at the Department of Social Services and Human Services that Noem said are underused, citing fewer people in nursing homes and declining Medicaid enrollment. She also requested deferment of a planned increase in maintenance and repair of state government buildings.