Hurricane Matthew costs loom over SC state budget

Budget debates could be less controversial next year under the State House dome.

Hurricane Matthew is expected to wreak havoc on state spending, leaving lawmakers with even fewer added tax dollars to argue over.

Lawmakers expect to have about $440 million in “new” – or added – money to spend next year, less than a third of the added money they spent last year.

But Hurricane Matthew’s costs quickly will cut into that added money. If last October’s flooding is an indicator, the state will have to send roughly $150 million in flood-recovery money to local governments and farmers, and to repair roads.

Official Hurricane Matthew costs have not yet been determined.

Still, Matthew will change the way lawmakers look at the budget for next year, said state Sen. Darrell Jackson, D-Richland, a member of the Senate Finance Committee.

Paying for Matthew’s damages will be a priority because of what’s at stake, Jackson said, citing farmers as an example.

“This hurricane was a lot worse than anybody expected as it relates to the damage and the aftermath,” Jackson said.

Jackson added that the cost of hurricane recovery and other looming budget issues – including added money already needed to fix crumbling roads and shore up the state’s pension system – means the state’s gas tax should be increased so that money from the state’s general budget does not have to be used to pay for road repairs. “What gives me some hope is, it’s not an election year.”

State Rep. Gary Simrill, R-York, agreed the road-funding needs remain and the state’s unfunded pension debt is a looming storm.

“There’s much unfinished business,” said Simrill, assistant majority leader of House Republicans.

Simrill said lawmakers prepared to spend fewer dollars by “careful budgeting” in previous years, instead of passing a large income-tax cut, for example.

However, state employees could pay a price.

Jackson said he already is warning state workers, many of whom he represents, they should “not expect any type of (pay) increase” next year.

That could cripple further several state agencies that face staffing shortages because they are unable to fill positions at the salaries they offer.

Jackson hopes lawmakers will promise to reward state workers with larger raises when the state’s budget years are better. This year, employees got their largest raise in a decade – 3.25 percent.

This story was originally published October 15, 2016 at 3:27 PM with the headline "Hurricane Matthew costs loom over SC state budget."