What the General Assembly did on Last Year’s Budget Vetoes
Last year the legislative session ended before the governor’s line-item vetoes of the 2017-18 budget were issued, and lawmakers opted to wait until session reconvened the following January to sustain or override them. The budget vetoes were accordingly the first order of business in the first two of weeks of session.
It takes a two-thirds majority in each chamber to overturn a gubernatorial veto; therefore, vetoes sustained by the House did not go before the Senate for a vote. In addition, the Senate postponed voting on a few vetoes, some of which are detailed below.
While the funding issues and priorities reflected in lawmakers’ votes are important, the policy approaches reflected in those votes are equally so. Most of the vetoed items are budget provisos, which should be used to explain budget spending. Unfortunately, provisos are frequently used to allocate revenue and even change policies, as detailed in the examples below. Here is a rundown of what happened with a few of the more important spending and policy items.
Bypassing the Commission on Higher Education’s oversight – SUSTAINED
One of the most significant vetoes was of a proviso allowing higher education institutions to submit project proposals directly to the Joint Bond Review Committee instead of going through the Commission on Higher Education (CHE), thus bypassing the oversight role state law vests in the CHE (read more here). The CHE has greatly increased pushback to higher education spending and debt proposals in recent years, and this particular proviso was not the first legislative attempt to circumvent CHE’s opposition in favor of university building projects. Needless to say, an agency which provides oversight of the spending of taxpayer dollars should not be stripped of its lawful role.
The House upheld this veto, but did so upon Ways and Means Chairman Brian White’s recommendation and statement that he had brought a separate bill that would accomplish the same thing. This bill – H.4182 – not only bypasses the CHE’s oversight but goes much further, granting sweeping powers to university boards of trustees and exempting them from almost all state oversight. This bill has yet to receive a committee hearing.
County transportation committee funds for beautification projects– SUSTAINED
This proviso would have allowed some of the transportation funds (recently increased by the gas tax legislation) allocated to the county transportation committees (CTCs) to be diverted from roads to “ancillary initiatives” – defined as “drainage improvements, signage, lighting, sidewalks and other safety or economic-development related projects.” As the governor’s veto message pointed out, this could easily encompass “beautification, landscaping and other lower priority activities.”
This would have been an inappropriate diversion of gas tax dollars to wasteful projects, in spite of legislative promises to dedicate the revenue to road maintenance and repair at the time the gas tax was passed. The House voted 85-25 to sustain this veto.
Requiring welcome center grass to be mowed – OVERRIDDEN BY HOUSE
This proviso had nothing to do with spending, which alone would make the proviso’s inclusion in the budget inappropriate. However, it is also a perfect example of how lawmakers typically approach government. The proviso would instruct the Department of Parks, Recreation and Tourism (PRT) to ensure that the grass is properly mowed at every welcome center complex. PRT’s director is appointed by and accountable to the governor, who stated in his veto message that he had already instructed the director to see to it that the grass was cut.
The House members’ refusal to allow the governor to handle even that small area of executive responsibility is just another instance of the General Assembly’s determination to control the entire state government rather than simply the legislative function, in complete violation of proper balance of powers.
The Senate postponed its vote on this veto.
Lee County Bus Stop – OVERRIDDEN
This proviso is a solution for a problem that does not exist. It instructs the Department of Education (DOE) to continue funding two bus stops in Lee and Kershaw counties. There are no plans to close those stops, as the governor noted, and Rep. Will Wheeler (from Lee county) explained that the proviso is simply a safety net because of the importance of the bus stop to his community. This may sound harmless, but it is not a sound policy approach. Not only does it legislatively micromanage an executive agency, it also codifies a policy when future needs may change – and does so out of fear rather than a legitimate need for a policy change. This line of thinking has dangerous implications if applied to other issues.
Surplus lottery funds for various education programs – OVERRIDDEN
This is a set of vetoed provisos in which lawmakers appropriated over $24 million of surplus lottery funds to a variety of education-related items, including school buses, county libraries, university equipment, and an economic development grant. The governor vetoed that funding on the twofold basis that a) spending money that hasn’t come in yet is not a responsible budgeting practice, and b) the lottery was created for the purpose of raising education scholarship funding.
Spending money before it comes in is never a wise financial practice, and surplus funds from a program dedicated for a specific purpose should not be treated as a slush fund. Moreover, when state law requires new school buses to be purchased every fifteen years, sufficient funding for that should be properly included in the DOE’s agency budget.
However, the Education Lottery Act (59-150-210) does require a certain amount of unclaimed prize money (not to be confused with net lottery proceeds) to be allocated by the General Assembly in its annual appropriations bill for purchasing new school buses, and for compulsive gambling disorder treatment and educational programs. Around $3 million of the vetoed funds were unclaimed prize funds allocated to school buses and therefore consistent with state law.
All of these vetoes were overridden, except a veto of $50,000 of surplus net lottery proceeds for a professorship (sustained by the House) and two vetoes of funding for research university equipment and an online academic library (the House overrode these, but the Senate postponed their vote).
The vetoes on which the Senate postponed a vote will remain on the Senate calendar until taken up.
Budget provisos continue to be a disturbing trend
It is no coincidence that of the forty-one items vetoed by the governor, most were budget provisos. Provisos have become a way for lawmakers to bypass the proper legislative process and slip spending and policy decisions into the budget that would be difficult to pass if properly explained and debated as a separate bill.
Accordingly, budget provisos are among the most important parts of the budget to watch. And as the 2018-19 budget develops we will be monitoring the new provisos closely, in addition to the General Assembly’s overall spending decisions and priorities.