South Carolina Senate Republican Caucus

Columbia, SC – Today, the South Carolina Senate passed a $488 million budget reduction plan. The plan, which calls for a seven percent reduction in the state budget, is an aggressive move that lawmakers hope will prevent further reductions in the current budget year.

³We were able to make the targeted reductions necessary without raising taxes,² says Senate Finance Committee Chairman Hugh Leatherman (R-Florence). ³These reductions are painful no doubt, but the Senate took a positive step today toward living within our means and as we move forward we will need to reduce spending to reflect the realities of our current economic times.² Read the rest of this entry »

Lawmakers decide not to change House bill; Sanford indicates he might veto some items

The South Carolina Senate approved $488 million in spending cuts Thursday, refusing to change a bill the House approved earlier this week.

Slashing state support for higher education, state agencies and conservation while limiting the reduction to K-12 education, lawmakers tried to spend money where it was needed most. The cuts were required after state economists lowered revenue projections earlier this month. Read the rest of this entry »

Works to Minimize Impact Felt by General Public

Columbia, SC – The South Carolina Senate Finance Committee met today to begin the process of reducing the 2008-09 state budget by almost $620 million. The 9.5 percent proposed reductions go beyond the $550 million necessary to bring the budget in balance; however, lawmakers hope that by taking a strong approach now, additional reductions will not be necessary. The current proposal avoids the possibility of raising taxes and maintains the funding priorities established during the original budget process with minimal impact to K-12 education and healthcare.

People need not worry about the General Assembly raising taxes,² says Senate Finance Chairman Hugh Leatherman (R-Florence). ³Our primary mission was to build a plan that maintains essential services, refocuses our spending priorities and allows us to live within our means, just as families all across South Carolina are doing. We also need to remember the reductions being proposed follow three years of tax cuts, which have returned over $1 billion annually to South Carolina taxpayers.² Read the rest of this entry »

When the Department of Consumer Affairs asked its employees if they would be willing to sacrifice part of their paychecks to prevent job cuts, the state agency’s entire staff volunteered.

The offer came as legislative budget writers return to Columbia today to cut the state’s budget by $250 million.

Consumer Affairs director Brandolyn Pinkston said her small agency — 62 employees with a budget of $2.2 million a year — cannot afford to lose any more workers. Read the rest of this entry »

Senate and House budget writers are meeting to patch the state’s $7 billion budget.

The Senate Finance Committee and House Ways and Means Committee meet Friday morning to talk about plans to deal with a nearly $500 million shortfall in state revenues.

Ways and Means Chairman Dan Cooper says most agencies will be told to deal with cuts ranging from 3 percent to 15 percent. He says legislators will give them some flexibility to handle the reduction.

The Legislature returns to Columbia Monday to take up a budget bill. It will take at least five days to get that bill to Gov. Mark Sanford’s desk. Read the rest of this entry »

Cities, counties, schools wrestle with budget woes

Local schools and governmental bodies are scrambling to figure out how they will manage with less state revenue.

On the heels of a 3 percent budget cut in August, state officials announced this past week that the state will have to do without an additional 6 percent.

The state’s Board of Economic Advisers said Wednesday that escalating fuel and food prices, sagging home sales, slumping home values and a shaky job market are to blame. Read the rest of this entry »

News of South Carolina’s sputtering economy led the state’s top budget writers Friday to begin planning for targeted cuts in state agencies’ spending, with no promises to exempt public schools or health care for the poor.

Senate Finance Committee Chairman Hugh Leatherman and House Ways and Means Committee Chairman Dan Cooper told Gov. Mark Sanford in a letter that they are willing to work with him on plans to put the state’s finances back in order after weeks of arguments about whether the Legislature needed to do anything.

All agencies face the likelihood of cuts deeper than the 3 percent across-the-board slice they took last month. Read the rest of this entry »

Economists see variety of troubling signs for state

South Carolina’s economy has worsened over the summer, and state economists said Friday further budget cuts are likely.

State lawmakers said they could return to Columbia to revise this year’s budget, which has already been cut once this year.

Among the troubling signs for the state, economists said:

• Unemployment has increased to 7.8 percent, a 15-year high.

• The state has lost 50,000 jobs since April.

• Sales tax collections are down 10 percent, mostly because of eliminating taxes on grocery sales.

• New construction and related taxes and fees are down 25 percent as fewer people are buying and building homes.

• Applications to receive food stamps are up 16 percent since December.

All are indications why the state is $42.6 million behind its revenue estimates only two months into the fiscal year — and down 5.5 percent from the same period a year ago.

“I think everybody ought to be on notice. … We’re looking at a substantial cut in our revenue forecast for this year,” said John Rainey, chairman of the Board of Economic Advisors. “The numbers have fallen off the cliff.”

This month’s figures mark a stark difference from prior reports.

Tax collections had been declining, but state businesses were still hiring workers and unemployment was steady. But that turned this summer, state economists said, as businesses stopped hiring.

There remain a few silver linings — rising exports and accommodations tax collections — in the state economy, economists said.

Sales tax and individual income tax are S.C.’s two largest revenue sources, and both are declining, according to data.

Rainey said that means additional budget cuts are likely.

The BEA already has trimmed its original estimate for the budget year that began July 1 by 2 percent, and Rainey said an additional 4 percent — or more — was possible when the board meets Oct. 8.

In July, a state budget panel cut spending by 3 percent — or $188 million — and set aside an additional 2 percent from a reserve account.

A further cut, as estimated by Rainey, could leave lawmakers with a roughly $70 million budget hole.

The chairmen of the House and Senate budget committees said Friday they would prepare to revise this year’s budget.

House Ways and Means chairman Dan Cooper, R-Anderson, said he did not know when — or if — the Legislature would reconvene, but they wanted to have a new budget ready in case. Cooper did not know whether the Legislature would rewrite the entire budget, or just make additional cuts to match the budget shortfall.

“We believe it is important for the General Assembly to prepare for spending adjustments,” Cooper and Senate Finance chairman Hugh Leatherman, R-Florence, wrote to Gov. Mark Sanford. “There are very difficult choices to be made, but we believe that making the tough decisions now will help our state adjust to the longer-term realities of diminished economic growth.”

Cooper and Leatherman asked Sanford to submit a list of suggested budget cuts.

Sanford spokesman Joel Sawyer said the governor had suggested cuts in his budget and vetoes. Sanford, Sawyer said, is willing to work with lawmakers.

Sanford has been calling on lawmakers to target cuts since July.

“The handwriting is on the wall that these cuts are going to need to be made sooner rather than later,” Sawyer said.

By JOHN O’CONNOR
The State Newspaper
September 27, 2008

Lawmakers don’t trust governor, McConnell says

Senate President Pro Tem Glenn McConnell on Thursday called Gov. Mark Sanford’s latest suggestion to get the Legislature back in session a $50,000-plus gamble.

Using an example of how lawmakers could use creativity to return to the Statehouse and make discretionary budget cuts, the Governor’s Office raised the idea of taking up an outstanding veto Sanford issued in June.

“I am not going to waste the taxpayers’ money so he can have a political dog-and-pony show,” said McConnell, R-Charleston. Read the rest of this entry »

Sanford, legislators bicker over how to meet

State Senate President Pro Tem Glenn McConnell and House Speaker Bobby Harrell are becoming regular penpals with Gov. Mark Sanford over South Carolina’s budget woes.

McConnell and Harrell, in an Aug. 29 letter, accused Sanford of “misleading the public” during a recent road show in which the governor called on lawmakers to return to Columbia to make targeted budget cuts in response to revenue shortfalls. Sanford’s tour across the state, and an Aug. 26 letter to McConnell, Harrell, Senate Finance Chairman Hugh Leatherman and House Ways and Means Committee Chairman Dan Cooper, came on the heels of the Budget and Control Board’s 3-2 vote for an across-the-board 3 percent cut to make up for a shortfall of about $188 million.

Sanford and Comptroller General Richard Eckstrom voted against the cuts, saying they favored the targeted cuts. Treasurer Converse Chellis joined Leatherman and Cooper in voting for the 3 percent reduction. Read the rest of this entry »

If a proposal by the S.C. Budget and Control Board that’s endorsed by Gov. Mark Sanford and state Sen. Hugh Leatherman of Florence is approved, state employees who smoke may have to pay more for health insurance.

Starting in 2010, workers covered by state health plans and HMOs who use tobacco products — or have family members on their policies who do — would be charged an additional $25 a month. The surcharge could affect tens of thousands of employees and save the state millions, according to the S.C. Budget and Control Board.

Sanford said those who choose to smoke should shoulder more of the burden of caring for ailing tobacco users. Read the rest of this entry »

Governor urges lawmakers to reconvene to trim state budget

The six highway patrolmen didn’t move a muscle while the governor tried to move a Legislature.

Gov. Mark Sanford, flanked by the troopers, appealed to people on Thursday to call their legislators to go back into session and stop across-the-board budget cuts. The cuts would impair “core government functions” like public safety, he said. Sanford wants the Legislature to make cuts agency-by-agency instead.

He compared it to how a family cuts its budget — they skip going to the movies, they don’t skip paying the mortgage. Read the rest of this entry »