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June 27, 2012

Budget deal reached; state workers to get raises

South Carolina lawmakers reached a budget deal late Tuesday, only four days before the state’s fiscal year ends.

South Carolina lawmakers reached a budget deal late Tuesday, only four days before the state’s fiscal year ends.

Now, however, legislators have to approve temporary funding to keep government running after midnight Saturday, giving Gov. Nikki Haley time to review the spending plan for any vetoes.

The SC House and state Senate are expected to take up the budget starting Thursday after leaders have a chance to go line-by-line over the spending plan, which includes a 3 percent pay raise for state workers.

After six hours of talks Tuesday, Senate and House leaders agreed on a small-business tax cut that has held up the $6.7 billion general fund budget since last week. The $60 million in tax cuts for sole proprietorships, including law and medical practices, will phase in over three years. The tax rate for those businesses would drop to 3 percent from 5 percent.

An extra $20 million once set aside for tax cuts this year will go to a fund to pay the cost of closing economic-development deals and for maintenance at colleges.

Longtime Senate Finance Chairman Hugh Leatherman, R-Florence, and first-time House Ways and Means Chairman Brian White, R-Anderson, battled hard over how to spend the final millions of $1.3 billion in new state revenue as the end of the fiscal year approached.

“I am tired of the egos in this place,” Gov. Nikki Haley said earlier Tuesday.

Haley said she wants the state-mandated five days to review the budget for vetoes after the document lands on her desk, which would be Friday at the earliest. However, some lawmakers suggested the governor, who said she would not veto the entire budget, could review the spending plan faster.

“No governor should have to shorten times on decisions this big because the Legislature can’t get their act together after six months,” Haley said.

Haley did not say what she would do if she receives a continuing resolution, which could keep government operating temporarily under the expiring state budget and avoid a shutdown of state government. Her five-day review for vetoes and a final vote by lawmakers would carry through the first week of the new fiscal year, which starts Sunday.

“I’m not going to make any decisions now because you all (reporters) are asking,” she said.

The House has approved a continuing budget resolution. The Senate is expected to take a final vote approving a continuing resolution Thursday after the budget conference report is signed.

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