House panel proposes spending $220 million of surplus for roads, Volvo

South Carolina counties could have $150 million more to spend on roads if a proposal approved Monday by the House’s budget writing panel becomes law July 1.

The House Ways and Means Committee also approved spending $70 million on incentives for Volvo, including a new Interstate 26 interchange, other roads, and water and sewage service at the Berkeley County site.

The House budget panel met Monday to recommend how the state should use $322.4 million, part of a surplus that the Board of Economic Advisors officially approved last week.

The added money for roads comes as a larger road repair proposal is expected to die later this week in the state Senate, where Sen. Tom Davis, R-Beaufort, is filibustering in an effort to block a gas tax increase.

If approved, the $150 million would be sent to counties based on their population, land area and miles of roads. The money would have to be spent on state roads.

However, using surplus money for road repairs is not a sustainable solution, said Rep. Gary Simrill, R-York, who sponsored the House road repair bill that is stuck in the Senate.

Earlier Monday, Republican Gov. Nikki Haley repeated she approves of spending surplus money on roads.

But Haley took issue with using some of the surplus for incentives the state agreed last month to give Volvo in return for pledging to build a $500 million, 4,000-worker plant.

Volvo wants the incentives paid for through economic development bonds, removing politics from the process, Haley said. “They did not want to go through the Legislature.”

The state Joint Bond Review Committee will meet Wednesday to consider a Commerce Department request to issue $123 million in economic development bonds for the Volvo incentives.

Haley said Monday that House Speaker Jay Lucas, R-Darlington, and Senate President Pro Tempore Hugh Leatherman, R-Florence, promised to go through the Joint Bond Review Committee, not the Legislature, for the incentives money.

Leatherman and Lucas signed letters in early April, saying they were supportive of economic development bonds for Volvo but did not specify the amount. “No one knew that this added (surplus) money would be certified at the end of the year,” Lucas said Monday.

“South Carolina made a promise – a promise the leadership of both bodies of the General Assembly made individually and explicitly – and we expect the members of the JBRC to fulfill that promise on Wednesday by authorizing the bond in the full amount of $123 million,” Haley spokesman Chaney Adams said.

However, some legislators have expressed concern the state is bumping up against its borrowing limit for economic development bonds.

House Ways and Means members Monday criticized Haley for pushing to borrow for Volvo after previously opposing a $500 million borrowing plan, passed earlier this session by the panel. That proposal was defeated in the full House after Haley compared it with running up the state’s credit card.

“On the tail end of beating the General Assembly’s brains out over bonding, to turn around and ask for bonding for her signature project, Volvo ... (is) inconsistent,” said state Rep. Chip Limehouse, R-Charleston.

This story was originally published June 1, 2015 at 7:39 PM with the headline "House panel proposes spending $220 million of surplus for roads, Volvo."