SC employees could miss out on pay raise, again

Thousands of teachers will get a pay raise from added money in Gov. Henry McMaster’s executive budget next year if S.C. schools Superintendent Molly Spearman gets her way.

But weak state revenue collections in September could threaten that raise.

And teachers are not alone. Other state agencies are looking for more money to keep and entice new employees as well.

However, the state’s general fund revenues for September — made up largely of sales taxes, and business and personal income taxes — were down about $14.7 million from a year ago.

For the first two months of the current fiscal year, which started July 1, revenues were up $52.2 million. However, the September drop could be a signal that salary increases will be hard to pay for, particularly when the state is still dealing with underfunded state pensions, rural schools and local governments, some say.

Frank Rainwater, executive director of the state Revenue and Fiscal Affairs, said the September dip could be a result of several factors. Most likely, it is due to money in the state treasury not yet recorded in the general fund. “Overall, we’re running very close to estimates.”

(October’s revenue collections are not yet available.)

State Sen. Floyd Nicholson, D-Greenwood, who sits on the Senate Finance Committee, said any revenue shortfalls concern him.

As a former teacher, Nicholson said he understands the need to pay teachers enough to retain them. “Education affects everything.”

Spearman and others say a raise is just one way to keep teachers from leaving for jobs that pay more. A raise in the starting salaries of first-year teachers — to $32,000 a year from an average $29,900 — also would help districts hire more college graduates.

South Carolina’s state employee pay lags behind both the state’s public and private sectors as well as neighboring states, according to a 2016 study. The last pay increase for state employees — 3.25 percent, the largest in a decade — was approved by the Legislature last year. State employees did not get a pay raise in the budget that took effect July 1.

Legislators will know just how likely pay increases are when the Board of Economic Advisers meets next week to release its revenue estimate for next year’s budget.

This story was originally published October 31, 2017 at 3:06 PM with the headline "SC employees could miss out on pay raise, again."