Hard to find now, SC senators want to show you how the Legislature spends your money
Some lawmakers want to make it easier for the public to follow the flow of state taxpayer dollars to the programs and special projects they fund.
The effort, called the Taxpayer Transparency Act, comes after exclusive reporting during the last year and a half from The State and Island Packet that revealed money being sent to legislators’ pet projects, often without any debate and buried within agency budgets.
A similar push was made last year, but efforts stopped as responding to the COVID-19 pandemic took priority.
On Tuesday, a Senate Finance subcommittee debated the bill, but didn’t move it forward as the panel of lawmakers awaits more information about the potential cost.
The proposal would create a state website with a searchable database showing what the state is spending on and who is receiving money. The S.C. Comptroller General’s website currently has a searchable database for payments made to organizations but doesn’t differentiate from grants, state contracts or budgeted earmarks.
More specifically, the bill would require expenditures to be listed as well as the names of entities, including nonprofits, local governments and businesses receiving funding from state agencies.
The legislation would also require which agency is paying for the expense as well as a descriptive purpose for the expenditure, including the expected performance outcome for the funding, past performance outcomes, and details on the type of spending, such as whether it’s through grants, contracts, appropriations, tax exemptions or credits.
The investigation by The State and the Island Packet found that it is often very difficult — and sometimes impossible — to know which legislator or legislators requested that the earmarked money be added to the state budget. The State newspaper also found at least $43.8 million in the 2019-20 fiscal year was sent through state agencies, which didn’t request the money, to recipients to carry out their projects.
The legislation, however, doesn’t specifically require legislators names be attached to earmarks included in the budget.
The Executive Budget Office would add information about individual expenditures 30 days after the information is received, under the legislation.
Bill cosponsor state Sen. Rex Rice, R-Pickens, said part of the motivation for the proposal was accomplished with a Senate rules change made this year making sure details of earmarks that originate in the upper chamber, and the senator who requested each earmark and an explanation of the project or program, be attached to the annual general appropriations bill.
The House has had a rule in place for at least a decade directing the body to track earmark requests from representatives by listing the name of the earmark sponsor and an explanation of the project. The information is posted on the House website.
However, the newspapers’ investigation found that the House does not publish all earmarks, failing to disclose any information about the sponsor, recipient or purpose of some earmarks.
Rice said too much of the state budget is hidden, and the desire to have this type of database has a broader motivation beyond earmarks.
“I mean earmarks is always part of the discussion, but I think the root of the whole thing is how complicated it is for the public to be able to look at the budget as a whole, understand where the money went and how efficiently the money is being spent,” Rice said. “Earmarks is just a piece of that, I mean the earmarks is one that everybody talks about, because that’s one that’s that’s low hanging fruit, but it’s the whole budget process as a whole, that’s driving the issue.”
State Sen. Dick Harpootlian, D-Richland, who has sued the Department of Commerce over its responses to Freedom of Information Act requests, said he supports the idea of the searchable website.
“There are a number of areas in state government which aren’t transparent,” said Harpootlian, who criticized the earmarks system after he secured money for a railroad crossing project in 2019 through the S.C. Department of Public Safety, but didn’t see the money listed in the state budget. “It shouldn’t be a struggle for the people of South Carolina to find out how their money is being spent.”
Members on the Senate Finance Sales and Income Tax Subcommittee on Tuesday were in support of the idea to increase transparency in the state government. But others worried about the additional cost this could be on the state in order to build out the system.
Comptroller General Richard Eckstrom said the state would need to invest in that merges the state’s accounting system with its budget system in order to build out the proposed website.
Eckstrom, who said he didn’t know how much it would cost, estimated it could cost tens of millions of dollars.
Eckstrom said the state has an “online checkbook” that shows that shows every expenditure made, the expenditure category the money came from and copies of receipts or invoices.
“The state does not have the budget system that’s needed to do this and so the state would have to make an investment, not in linking two existing systems, they’d have to create one system,” Eckstrom said.
Eckstrom said a system doesn’t exist in the state that includes the intent of expenditures.
“The state’s current accounting system does not include performance data,” said Brian Gaines, the director of the Executive Budget Office.
The unknown expense, however, caused some hesitation to move the legislation forward.
“I like to see what the fiscal impact is going to be for this thing. What it’s going to cost? I don’t want to give it a stamp of approval, now we’re spending $3 million of $4 million a year to merge a system,” said state Sen. John Scott, D-Richland. “And that $3 or $4 million a year could be going to taking care of families ... and other kinds of situations we have in the state, educating children, fixing schools and those kinds of things.”
“We do want to know the numbers, but I do want to know what it’s going to cost to take care of it,” Scott added.
The legislation remains in a Senate Finance Sales and Income Tax Subcommittee as potential costs are researched.
“What I’m hearing is we can’t afford to do it. I’m looking at it in a different way. We can’t afford not to do it,” Senate President Harvey Peeler said. “If we want to be transparent, this is a way to do it.”
Lawmakers pushed the legislation after reporting of secret earmarks being put into the state budget without any indication of what the money was being spent on or the goal of the spending.
“This legislation, if enacted, would allow citizens of South Carolina to see what our state government funds, without the need of having (the) training to be an investigative reporter, or a staffer, or someone that is used to digging through these documents,” said Andrew Yates, the state director of the Americans for Prosperity-South Carolina.
