The elevators in the state-owned Wade Hampton Building have their original 1938 parts.
“It makes you want to use the stairs,” S.C. Department of Administration head Marcia Adams told a panel of House budget writers last week.
But the state does not have enough added money to pay for repairs to the Wade Hampton Building and other state-owned facilities, including colleges and universities.
Instead, the $446 million in added money in the state budget that takes effect July 1 likely will go to shore up the state’s underfunded pension system, and pay for Hurricane Matthew’s damage and state services, including K-12 education.
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As a result, S.C. lawmakers are looking to borrow money to pay for renovations and building projects at some of the more than 5,000 state-owned buildings.
“Now is a good time to borrow,” said S.C. House budget committee chairman Brian White, R-Anderson, noting interest rates are low.
Lawmakers also are feeling pressure from S.C. colleges.
University of South Carolina president Harris Pastides has urged lawmakers to borrow to pay for higher-ed projects, and, this year, USC has new allies in the governor’s office.
New Gov. Henry McMaster earned his undergraduate and law degrees from USC, and recently led fundraising efforts to build a new USC law school building. McMaster’s chief of staff, Trey Walker, is also a USC alumnus and recently was USC’s chief lobbyist.
State has building needs, capacity to borrow
The deteriorating Wade Hampton Building, which sits on the State House grounds, houses the Comptroller General’s Office, and Administration and Agriculture departments.
The building needs $5.3 million in overdue maintenance, a fraction of the $93.5 million in deferred maintenance needed at 147 state-owned buildings, not including colleges.
The state has the capacity to borrow roughly $2 billion, according to the S.C. Treasurer’s Office.
“We took taxpayer dollars to build buildings and now we’re just going to let them collapse?” White asked rhetorically.
Like a homeowner, the state has to maintain its buildings, replacing roofs, heating and air systems, and windows, White says. “We are looking at a bond bill — the potential of one — to pay for those items.”
USC pushing for a bond bill
On top of deferred maintenance costs, the Department of Administration estimates the state will have $799.2 million in building costs during the next 30 years.
Building projects make up the bulk of the roughly $1 billion in added money that colleges and technical schools have requested from the state in next year’s budget.
Colleges and universities say they need the money for maintenance and renovation projects that were deferred when the state cut its funding of higher education after the Great Recession.
But if lawmakers agree to borrow for colleges, they will want the schools to agree to rein in tuition and fee increases. Failure to do that would be “double-dipping on the taxpayer,” White said.
Unlike his predecessor, new Gov. McMaster could look favorably on a bond bill for higher education.
A $500 million borrowing proposal, much of it for college projects, failed in 2015 after Republican Gov. Nikki Haley threatened to veto the plan, comparing it to running up the state’s credit card debt.
“Gov. McMaster has always supported the mission of our state’s public colleges and universities, and served enthusiastically on the state Commission on Higher Education,” said McMaster spokesman Brian Symmes.
“He also believes that any discussion of a higher-education bond bill for new construction projects must be coupled with a discussion on how to best protect the taxpayer and provide relief for those paying tuition.”