$1B more is available to finalize SC spending plan. How budget writers may use it
Additional new projected revenue may make finalizing a state budget easier.
Budget writers were told Tuesday they had an additional $377 million in annual dollars and $669 million in additional one-time money available to allocate as they finalize a spending plan to begin on July 1. Lawmakers are finalizing how much they want to spend on bridge repairs, building maintenance and on the state’s school choice program.
Before Tuesday’s projection from state economists, budget writers had $666 million in new annual dollars to allocate and $1.2 billion in one-time money available.
The House proposed a $14.6 billion general fund spending plan. The Senate pushed for a $14.4 billion spending plan.
The new money can help close the $150 million worth of differences in proposed recurring expenses and roughly $600 million differences in proposed one-time expenses laid out in the House and Senate budget plans.
“There’s enough money to cover everything, and then we will have money left over that we will not allocate in this budget cycle,” House Ways and Means Chairman Bruce Bannister, R-Greenville, told reporters after Tuesday’s first budget conference meeting.
Further discussions are expected to take place Wednesday with budget writers prepared to work into the evening to finalize the spending plan to present the full General Assembly next week.
Both plans reduce the state’s top marginal income tax rate to 6% from 6.2%, set the minimum starting teacher salary at $48,500, cover health insurance premium increases for those on the state health plan, and lock in planned state employee raises.
What are the differences in spending plans?
Among the differences in the spending plans is how much money to spend on kindergarten through 12th grade scholarships for the state’s school choice program and where the money would come from. Lawmakers have the choice between the general fund and lottery revenue.
Budget plan differences also include on how much to spend on Medicaid, how much to give the S.C. Department of Transportation for bridges, how much to spend to help the Department of Commerce prepare sites for development, and how much to spend on airport enhancements.
Budget writers also have to decide whether to give the Medical University of South Carolina $25 million for construction of a new College of Medicine building, and whether technical schools should receive money for specific capital projects or just be given block amounts to use on maintenance.
What other points of contention are there?
Questions on how much to keep available to pay off debt also is a point of contention.
The increased revenue figures come as states brace for potential budget cuts from Washington that could force states to pick up the costs of services covered by the federal government.
“It’s nice to have growing revenues and one-time money that’s not going to be spent this year to have a cushion in case something does happen in the next 12 to 24 months,” Bannister said.
Also the six budget conference committee members will have to work out where to set authorization levels for federal and other non-general fund dollars. Authorization levels are what state agencies are allowed to spend of federal and other money that does not come from the general fund.
Senate Finance Committee staff looked at authorization levels and how much had been used by state agencies. Authorization reductions the Senate proposed are due to a program no longer existing or the money associated with it having been reduced.
It had been characterized as a budget cut, even though the changes were made mostly away from the state budget writers.
The House didn’t initially adopt the move when it wrote its second draft of the spending plan, but conference committee members expect to accept the changes in authorization levels.
“We will likely go along with that is something that just cleans up what’s in the budget,” Bannister said. “We don’t object to doing it. We just object to the characterization.”
