Budget Watch 2011: The South Carolina Budget is Growing – Fast

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What happened to the ‘tough budget year’? A few weeks ago we reported that the House version of the budget was larger than last year’s budget by about half a billion dollars. The Senate Finance Committee’s budget is $101 million larger than the House budget.

  • Legislators are well on their way to passing the largest budget in state history.
  • So far, the overall budget is $652 million more than last year’s budget passed by the General Assembly.
  • Every part of this year’s budget is larger than last year’s – whether it’s General Fund spending (up by $238 million), Fines and Fees/Other Funds revenue (up by $246 million), or money the state accepts from Washington, D.C. (up by $168 million).
  • The Senate budget contains significant differencesfrom the House budget. These include:
    • A $2.6 million increase – 217 percent over and above the House appropriation – for the Election Commission.
    • A $532,000 increase for the Legislative Audit Council – a 62 percent increase.
    • A $600,000 increase for the Human Affairs Commission – 49 percent more than the House budget.
    • $2.9 million less for the Retirement System Investment Commission – a 25 percent decrease.
    • $75,000 more for upkeep and grounds keeping at the governor’s mansion – a 15 percent increase.
    • $6.7 million more for the Department of Revenue – a 12 percent increase.
    • $992,121 in additional funding for the State Treasurer’s Office – an 11 percent increase.
    • $642,370 more for the Aeronautics Commission – a 10 percent increase.
  • The budget funds core education and Medicaid services using one-time dollars that will create a budget hole next year.
  • Once the budget hit the House floor, legislators crammed it with millions of dollars for pet projects including $2.2 million for the Palmetto Gold and Silver Awards program, $1 million for the S.C. Youth Challenge Academy, and so on.
  • The budget process is shrouded in mystery. For example . . .
    • Last year the Board of Economic Advisors (BEA), which the Legislature relies on for revenue projections, said there’d be an $829 million budget shortfall. Then that number dropped to $700 million. Then the BEA said there would be no shortfall at all.
    • The actual budget will very likely be larger than originally reported, as the budget voted on by legislators does not fully account for proviso spending. Last year, state government spent $671 million more than originally appropriated.*
    • Many budget “provisos” allot money without saying how much – so no one really knows how many taxpayer dollars are being spent on pet projects and other authorizations.

*One indicator of this discrepancy is the difference between the Senate Finance summary control document and the final budget reported out by the Finance Committee. The summary control document presumes a total budget of $22.135 billion – $986 million more than last year’s budget. This document seems to account for more (but not all) proviso spending than the reported budget.

Copyright © 2011 South Carolina Policy Council
This material should not be construed as an attempt to aid or hinder the passage of any specific legislation

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