SC House approves $9.8 billion state spending plan with limited new dollars
House members voted 112-6 on Tuesday to approve a $9.8 billion state spending plan, which puts hundreds of millions of dollars into rainy day funds in case revenues do not come in as expected as the COVID-19 pandemic continues.
And on Wednesday, they gave the bill what ended up being a largely formal vote in favor, sending the spending plan to the Senate for consideration.
Lawmakers had to work with a limited amount of new recurring projected revenue, just $189 million to spend — down from the $800 million they expected to have before the COVID-19 pandemic — and they also have $956 million of nonrecurring dollars available. However, much of that one-time money is being set aside for the state’s capital reserve fund and a COVID-19 reserve fund to help ease any future stress on the state budget resulting from the pandemic.
As a protection against the economy slowing again, House budget writers set aside $500 million of the nonrecurring money in a contingency fund to cover shortfalls in the future.
House lawmakers added provisos, one-year laws attached to the budget, dealing with adoption agencies with religious affiliations and election fraud, leaving many priorities for some lawmakers and state agencies unaddressed.
However, House budget writers expect to return to the appropriations process later in the spring after new estimates from the Board of Economic Advisors come in, which could deliver more revenue for the state to spend, as high as an additional $440 million.
Lawmakers also will be faced with allocating $2.1 billion in federal money from the American Rescue Plan Act, as well as $525 million from the Savannah River Site settlement.
The amount of new revenue is smaller than previously expected because of how the COVID-19 pandemic has wreaked havoc on the economy and the state’s revenues. The pandemic led lawmakers to keep spending levels the same for the current fiscal year, which ends on June 30.
One big priority for state employees wasn’t included.
The House did not vote to give all state employees a pay raise in its spending plan, but lawmakers did include $16.2 million for annual pay bumps and pay increases to retain state law enforcement and corrections officers.
However, state Rep. Gilda Cobb-Hunter, D-Orangeburg, pushed for giving the remainder of state employees earning less than $75,000 a year a 2.5% pay raise, a move that would cost about $41 million.
“There is no way that I am convinced that we can’t figure out how to find $41 million after April, when the BEA tells us how much money we have,” Cobb-Hunter said.
“State employees are pretty fed up with being told wait until next year,” she added.
State Rep. Murrell Smith, R-Sumter, who chairs the Ways and Means Committee, said he is supportive of giving state employees a raise, but the opportunity to approve them would be later in the session after new revenue projections come out.
Smith said members wanted to err on the side of caution because of the economic uncertainty brought about by the COVID-19 pandemic.
“If something happens to our economy in South Carolina, then let’s protect our agencies, then let’s protect our employees,” Smith said.
Smith said as the pandemic has continued, revenue declined, then later stabilized. He added the state is now seeing a growth in revenue.
“I know a priority of mine ... is to make sure we thank state employees and we recognize their hard work and their sacrifice, and we need to do that with an increase in their pay,” Smith said. “That is what we need to do if we have recurring revenue. If we do not have recurring revenue, we will do a bonus.”
The proposed spending plan does include dollars to pay teachers their annual pay bump based on experience and education level.
Also included in the plan:
▪ $318 million for LIFE, HOPE and Palmetto scholarships, $51 million for tuition assistance, $80 million for student needs-based grants, $16 million for workforce scholarships, and $17 million for the S.C. WINS program.
▪ $90 million for the Department of Corrections to make long sought security upgrades to the prisons needed after the Lee Correctional Institution had a deadly riot in 2018.
▪ $30 million for broadband expansion in the state aimed at addressing a lack of access to the internet exposed by the pandemic. However, the amount of money only scratches the surface of the state’s needs to increase access to high speed internet.
▪ $5.5 million to ensure every school in the state has a nurse on campus.
Among the provisos added during Tuesday’s House debate was a provision to have the Election Commission produce a report on the number of election fraud investigations conducted in regards to the November 2020 election. The report would be due by Aug. 1 .
House members also agreed to an amendment to ensure religious groups can decline to provide adoption services and based on religious beliefs or moral convictions.
State Rep. Garry Smith, R-Greenville said the amendment is about preserving religious freedom and people interested in adoption who may be rejected by one organization, can go to another other adoption agency.
Lawmakers against the amendment said the proposal, which needs to survive Senate approval, is discriminatory.
In an effort to convince supporters of the proposal of how it could be abused, state Rep. Todd Rutherford, D-Richland, also said this language will have unintended consequences.
“Let’s say the atheists who believe this country should be torn down, and we establish a religion, and we establish an adoption agency, we now have the protection of this bill,” Rutherford said.
This story was originally published March 23, 2021 at 8:30 PM.
