South Carolina state budget
From Sunshine Review
South Carolina finalized its FY 2010 budget in May of 2009, passed by the South Carolina Legislature on May 13 and signed (with some vetoes) by Gov. Mark Sanford on May 19.[1]
South Carolina Budget and Control Board (See "Budget Background" for more information about the BCB) ordered 4% across-the-board cuts to South Carolina’s budget on September 3, 2009 due to lagging revenue collections to address an estimated $200 million deficit for the current fiscal year.[2] First quarter FY 2010 General Fund revenues from July to September 2009 declined 6.3% from the previous year, $1.555 billion 2008 to $1.458 billion 2009. Individual income tax collections declined 6.2% and and sales taxes declined 6.8% for the first quarter.[3]
South Carolina also had a $98 million shortfall from FY 2009. The Budget Control Board approved in September 2009 Comptroller General Richard Eckstrom taking funds from some state agency accounts that will not be used until later in the fiscal year to cover the FY 2009 deficit with the understanding the transfer would be paid back.[4] Regarding the 4% cuts, Gov. Mark Sanford previously has argued the Legislature should deal with budget shortfalls by coming into session and making targeted spending reductions. But this time, he said waiting until lawmakers come back into session in January would give agencies much less time to absorb the cuts, making the cuts even more painful.[5]
South Carolina's FY 2010 budget that started July 1, 2009 is composed of 5 major funds: [6]
| General Funds | $5.7 billion |
| Federal Funds | $7.8 billion |
| Earmarked Funds | $4.6 billion |
| Restricted Funds | $2.6 billion |
| Total Funds | $20.7 billion |
49.6% of General Funds are appropriated for K-12 and higher education. Health and social rehabilitation agencies received 24.5% of the General Funds appropriated; from all funding sources however, health and social rehabilitation agencies received 43.8%.[7]
FY 2010 budget revenue for all funds is $8 billion, $5.7 billion of which is General Funds. The top 5 state revenues are: [8]
| Individual Income Tax | $2.5 billion |
| Sales Tax | $2.2 billion |
| Insurance Tax | $174 million |
| Corporate Tax | $129 million |
| Beer and Wine Tax | $107 million |
[edit] Budget Background
The South Carolina Budget and Control Board (BCB) plays a key role in the general management of state government. This institution is unique to South Carolina and provides a broad array of services to other parts of the public sector as well as administrative and regulatory functions. The Board is made up of the Governor, the Treasurer, the Comptroller General, the Chairman of the Senate Finance Committee, and the Chairman of the House Ways & Means Committee. Created in 1978, the Executive Director is the chief administrative officer for the Board and serves at the pleasure of the five members of the Budget and Control Board. His office is responsible for administration, operation of the Board divisions, and legal matters. Frank Fusco was named the Board's Executive Director on August 15, 2007.[9]
The General Reserve Fund balance must equal 3% of General Fund revenue and may be withdrawn only for the purpose of covering operating deficits. If amounts are withdrawn from the Reserve Fund, the South Carolina Constitution provides a schedule for restoring the Reserve within three years. For Fiscal Year 2008-2009, the General Reserve had a balance of $108.1 million; however, this balance was eliminated to help offset a year-end deficit. The FY 2009-10 contribution to the General Reserve Fund was $63.9 million, which is the current balance.[10]
South Carolina's fiscal year begins July 1 and ends June 30 of the following year. Agency budget requests are submitted to the Governor by October, after which the Governor compiles his recommendation for the new fiscal year. Every January the Governor is required to submit an Executive budget to the Legislature containing an itemized plan of proposed expenditures, the amount appropriated for the last preceding appropriating year and for the current year. Following a series of meetings the House and the Senate pass a version of the budget. If both versions do not match a six member conference consisting of both House and Senate members is assembled to sort through the differences. The Governor has final say on the budget and has the power to veto sections. In 1998 the state Supreme Court ruled that the Governor cannot strike individual sentences. A two-thirds majority is needed in both Houses to override the Governor's veto. [11]
- From 2004 to 2008, the South Carolina legislature's spending increased by 40 percent.[12]
- FY 2006-07 and FY 2007-08 combined, the General Assembly spent an additional $1.3 billion in surplus revenues. [13]
[edit] Budget figures
The following table provides a history of South Carolina's budgeted spending in recent years. Figures are based on the budgets as they were ratified by the legislature, and do not take budget cuts into account:
| Fiscal Year | Total Expenditures | Change from Previous Year |
|---|---|---|
| 2008 | 20,858,585,100[14] | 2.9% |
| 2007 | 20,266,849,917[15] | 5.3% |
| 2006 | 19,242,459,434[16] | 6.7% |
| 2005 | 18,033,783,808[16] | 7.2% |
| 2004 | 16,818,721,431[16] | 9.0% |
| 2003 | 15,424,866,119[16] | 2.4% |
| 2002 | 15,060,995,600[16] | 2.2% |
| 2001 | 14,730,477,146[16] | 6.1% |
| 2000 | 13,889,209,525[16] | n/a |
- See South Carolina state budget (2008-2009) for more information.
[edit] Accounting Principles
The South Carolina Office of the State Auditor performs financial audits of state agencies, the annual financial audit of the State's General Purpose Financial Statements, and the annual Single Audit of the State's Schedule of Expenditures of Federal Funds. The audit reports are published online. Richard H. Gilbert, Jr. is Interim State Auditor.[17]
The Institute for Truth in Accounting (IFTA) rates South Carolina “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider South Carolina's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[18] South Carolina's CAFRs are annual publications of the South Carolina Comptroller General, the state's top accountant supervising state spending, keeping the state's books and maintaining accounting controls over state agencies. Richard Eckstrom has served as South Carolina's Comptroller General since 2002.[19]
| Credit Rating | Fitch | Moody's | S&P |
| South Carolina[20] | AAA | Aaa | AA+ |
[edit] Economic Stimulus Package
South Carolina is expected to receive approximately $2.8 billion from the $787 billion economic stimulus package. [21] According to White House officials the stimulus bill is estimated to create or save 50,000 jobs. [22] However, believing the state's budget deficit resulted from irresponsible spending, not actual need, Governor Sanford vocally opposed the American Recovery and Reinvestment Act of 2009. In taking this stance, Sanford conflicted with members of the state legislature. Despite the opposition of Sanford and others to a federal stimulus, some assert that opposition to stimulus funds will not be acted upon.[23] However, on March 11,2009 Gov. Mark Sanford became the first governor to announce that he rejected $700 million in federal stimulus money. The Governor said that he believes that the stimulus money would destabilize South Carolina's economy. [24] Sanford was quoted in The New York Times saying:
"We simply cannot afford to base 10 percent of our state budget on money that will disappear in two years’ time."[25]
Of the American Recovery and Reinvestment Act as a whole, Sanford said:
"What you're doing is buying into the notion that if we just print some more money that we don't have and send it to different states, we'll create jobs. If that's the case, why isn't Zimbabwe a rich place?" [26]
Gov. Mark Sanford speaks against the stimulus plan |
According to preliminary reports South Carolina is expected to receive:[21]
- $445.5 million to offset its budget deficit and education shortfalls
- $1 billion in tax relief for South Carolinians
- $882 million in extra Medicaid payments
- $566 million in increased unemployment benefits
- $482 million to build and repair roads and bridges
- $335 million for low-income health insurance
- $260 million for food stamps
- $59 million for weatherization [27]
[edit] Budget transparency
South Carolina Spending Transparency is the publicly available website created by the South Carolina government. It discloses information about South Carolina's spending, and is managed by the Comptroller General. South Carolina's current Comptroller, Richard Eckstrom, has written extensively on the importance of state and local transparency.[28] He wrote in December, 2008, that:
"Earlier this year, I worked with Gov. Mark Sanford to create an easy-to-use spending transparency Web site. It contains detailed spending information for more than 80 state agencies, giving the public more access than ever to information about how state government spends its hard-earned tax dollars. This Web site, which is available through my office’s site (www.cg.sc.gov), is serving as a national model for other states attempting their own transparency initiatives. Several states have contacted me hoping to duplicate our open-government ideas."[29]
[edit] Legislation
[edit] Government tools
The South Carolina Spending Transparency database provides a searchable expenditures database.
The following table is helpful in evaluating the accessibility and scope of the information provided by the South Carolina Spending Transparency page.
| State Database | Searchability | Grants | Contracts | Line Item Expenditures | Dept/Agency Budgets | Public Employee Salary |
|---|---|---|---|---|---|---|
| South Carolina Spending Transparency |  |  | | | | |
[edit] Economic Stimulus Transparency
- The American Recovery and Reinvestment Plan of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.[30]
- South Carolina will receive an estimated $2,105,359,474.[31]
- South Carolina Comptroller General Richard Eckstrom has been choosen by the governor to lead a stimulus transparency group. Eckstrom plans a unique coding system to match up and track the stimulus money to ensure it is used for its intended purpose. The oversight group is also developing a website to let citizens monitor these funds
The South Carolina Spending Transparency database provides a searchable expenditures database.
[edit] Error in ARRP
On November 16 and 17, 2009, many errors were found in the $747 billion plan that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.[32][33]
ARRP's website shows that more than $27 million in funds went to the 7th District of South Carolina, which has not existed since the Great Depression. The seven phantom districts have received a total of $40,729,993 to create or save 52.4 jobs.[34]
[edit] Support for creation of the database
Governor Mark Sanford signed South Carolina Executive Order 2007-14 on August 30, 2007. The order required the comptroller to compile and disclose information concerning how the state agencies of South Carolina allocate revenues.[35]
[edit] Public employee salary information
On South Carolina's state homepage, citizens can find a searchable state employee database.
The State publishes a database of South Carolina government employee salary information. Users can search by a partial name, a partial agency name, or all employees in an agency. It also has handy lists of employees earning more than $150,000 and $100,000, along with the top 5 highest-paid employees by agency.
The Sun News provides a state salaries database including the names, positions and salaries of state and local government employees making $50,000 or more a year in base salary.
[edit] See Also
South Carolina taxpayer-funded lobbying
[edit] References
- ↑ South Carolina General Assembly, "H. 3560 General Appropriations Bill for fiscal year 2009-2010 As Ratified by the General Assembly Title Page," July 2, 2009
- ↑ Independentmail.com, "Budget and Control Board cuts 4 percent from S.C. state budget," September 3, 2009
- ↑ South Carolina Budget Control Board, "BEA Working Group Meeting," October 15, 2009
- ↑ Independentmail.com, "Budget and Control Board cuts 4 percent from S.C. state budget," September 3, 2009
- ↑ WSPA.com, "SC Budget & Control Board Approves 4% Cut From Agencies Thursday," September 3, 2009
- ↑ South Carolina General Assembly, "H. 3560 General Appropriations Bill for fiscal year 2009-2010 As Ratified by the General Assembly," May 26, 2009
- ↑ Office of the State Budget Web site, retrieved November 11, 2009
- ↑ South Carolina General Assembly, "H. 3560 General Appropriations Bill for fiscal year 2009-2010 As Ratified by the General Assembly," May 20, 2009
- ↑ South Carolina Budget and Control Board Web site, retrieved November 11, 2009
- ↑ Office of the State Budget Web site, retrieved November 11, 2009
- ↑ Children's Trust of South Carolina,"Budget Process," retrieved March 23,2009
- ↑ Wall Street Journal, "Two Governors and the GOP Future," February 20, 2009
- ↑ State of South Carolina,"Executive Budget: fiscal years 2009-2010," January 9,2009
- ↑ [http://www.scstatehouse.gov/sess117_2007-2008/appropriations2008/tas87.htm South Carolina General Assembly, "H. 4800: General Appropriations Bill for fiscal year 2008-2009"]
- ↑ South Carolina General Assembly, "H. 3620: General Appropriations Bill for fiscal year 2007-2008"
- ↑ 16.0 16.1 16.2 16.3 16.4 16.5 16.6 Office of State Budget, "Historical budget information for each state agency?", September 13, 2006
- ↑ South Carolina Office of the State Auditor Web site, retrieved November 11, 2009
- ↑ Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
- ↑ South Carolina Comptroller General Web site, retrieved November 11, 2009
- ↑ State of Indiana, “State Credit Ratings-as of June 24, 2009"
- ↑ 21.0 21.1 The State,"Its senators voted no, but S.C. will get billions from stimulus," March 10,2009
- ↑ American Recovery and Reinvestment Act,"Estimated job effect," retrieved March 23,2009
- ↑ Washington Post, "Keep Your Stinking Stimulus," February 20, 2009
- ↑ Miami Herald,"S.C.'s Sanford makes it official, rejects $700 million stimulus," March 11,2009
- ↑ The New York Times,"South Carolina Governor Rejects Stimulus Money," March 20,2009
- ↑ CNN,"S.C. governor evokes Zimbabwe in arguments against stimulus," March 11,2009
- ↑ The Post and Courier,"S.C. to weatherize, boost green energy," March 18,2009
- ↑ Herald-Journal, "Urge local governments to put spending information online," December 28, 2008
- ↑ Herald-Journal, "Urge local governments to put spending information online," December 28, 2008
- ↑ National Taxpayers Union, "A Letter to the Nation's Governors: Ensure Transparency and Accountability by Posting Stimulus Expenditures Online," March 10, 2009
- ↑ Wall Street Journal,"Stimulus Spending by State," March 12,2009
- ↑ $6.4 Billion Stimulus goes to Phantom Districts, Watchdog.org, November 17, 2009
- ↑ Stimulus Creates Jobs in Non-Existent Congressional Districts, Watchdog.org, November 16, 2009
- ↑ South Carolina, Watchdog.org, November 17, 2009
- ↑ South Carolina Executive Order 2007-14
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