Ways and Means Budget Largest in State History – Yet Again

The House is currently debating the budget recommended by the Ways and Means committee after months of hearings. With just over $535 million in “new” recurring revenue[1], lawmakers justify spending as “filling the holes” caused by the recession. However, as we pointed out in our analysis of the executive budget, since 2002 the state budget suffered an overall loss during only FY 09-10, and it only dropped by 0.8 percent.

The appropriated figures for the three main components of the Ways and Means budget (General, Other, and Federal funds), compared[2] to the FY 11-12 final budget, are as follows:

The South Carolina State Budget: General, Federal, and Other funds

Revenue Source

FY 11 – 12

Ways & Means Committee Budget

Dollar Change

 Percent Change

General Fund




9.8 percent

Federal Funds




2.8 percent

Other Funds




2.3 percent


$ 21,901,829,654



4.4 percent


From a bird’s-eye-view, here’s what these numbers mean:

  • General fund spending explodes with a 9.8 percent increase, well above the 5.23 percent growth cap the Governor’s executive budget recommends.
  • Total spending has hit a historical high again – up by 4.4 percent.
  • Dependence on federal cash is up by 2.8 percent.

Largest Ever – Again

As indicated above, the total base budget (excluding non-recurring provisos) is $22.8 billion. This is over $950,000 more than last year’s base budget of $21.9 billion. Spending increases in all three budget funds, with General fund spending increasing by $534 million, or 9.8 percent. Just how does the Ways and Means committee recommend spending these additional General Fund dollars? Economic development, where else? Here’s a taste of economic development spending in the General Fund:

  • The Department of Commerce sees a 407 percent increase, from $3.8 to $19.7 million in General Fund appropriations. The major contributing factors are an $8 million dollar appropriation to the Deal Closing Fund, which was funded last year solely through a $5 million dollar Capital Reserve Fund. The current budget recommends making that money recurring as General Fund appropriations, in addition to adding $3 million dollars to the fund.  And don’t forget about the $5.5 million additional non-recurring proviso funds the Ways and Means committee recommends the department receive – $2 million of which also goes to the Deal Closing Fund.
  • The Department of Parks, Recreation, and Tourism also enjoys a significant 71 percent increase, from $17.2 to $29.3 million General Fund appropriations. The roughly $12 million dollar increase is primarily due to $8 million allotted for the 2 to 1 match for the tourism marketing grant program “Destination Specific.”  This program was funded last year through a $5.4 million dollar Capital Reserve Fund appropriation.  The current budget recommends making that money recurring as General Fund appropriations, in addition to adding $2.6 million dollars to the program.
  • The Department of Agriculture is appropriated an additional $1.5 million in General Funds, with $1.25 million allotted for statewide marketing and the “Agribusiness Economic Development Initiative.” And they are set to receive an additional $1 million in non-recurring proviso spending. As we recently pointed out, the Department of Agriculture strays from its mission when getting involved in economic development.

Comparing the Ways and Means Budget Recommendations with the Executive Budget

Both budgets increase spending by about 4.4 percent, each taking their own approach. As stated previously, the Ways and Means committee increases General Fund spending by 9.8 percent, with the Governor increasing it by only 4.5 percent. The Governor, however, increases Federal and Other Funds more than the Ways and Means committee (by 1.6 percent and 1.7 percent respectively). As we’ve pointed out, reliance on federal dollars obligates state taxpayer dollars to federal projects, not to mention the loss of autonomy. And, as The Nerve revealed, Other Funds are used by lawmakers to hide the actual size of their budgets.

Noticeable cuts

The Governor’s Executive Budget cuts four agencies’ General Fund appropriations, most notably completely defunding the Arts Commission. We’d like to tell you about General Fund decreases in the Ways and Means budget, but there aren’t any.

Capital Reserve Fund Spending

The budget also includes a separately voted on fund called the Capital Reserve Fund, which is equal to two percent of the General Fund revenue of the latest completed fiscal year. Revenues in the Capital Reserve Fund are primarily used to fund capital improvement projects, but may also be used for various other reasons. This year the Ways and Means committee recommends $47 million of the $104.8 million fund go to the Department of Employment and Workforce for unemployment tax relief. The rest of the fund is dispersed among several higher education institutions for various improvements, including $16 million to the State Board for Technical and Comprehensive Education for the CATT program and ReadySC, a taxpayer-funded job training program.

Stay tuned for more budget details as we follow it from the House to the Senate.

[1] See line 15 of the 28 page spreadsheet (link provided above).

[2] This analysis is based on Part 1A of FY 11-12 passed budget (H.3700) and Part 1A of H.4813. Part 1B of H.4813 stipulates nonrecurring proviso spending. According to the spreadsheet used by the Ways and Means committee during budget proceedings, proviso spending totals $543.5 million, making the total budget $23.3 billion, not the $22.8 billion reported in part 1A. The proviso spending total reported includes only provisos the General Assembly and the Budget and Control Board reported (sections 89 and 90).  In addition, the Capital Reserve Fund is considered a line item in Part 1A of the budget and the funds are therefore not included in specific agency budgets that receive those funds.

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One Comment on “Ways and Means Budget Largest in State History – Yet Again”

  1. They will tell you it’s only 4.4 %. When are we actually going to reduce spending and stop telling people spending is slowing down and that it’s a good thing.

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