The Palmetto Insider

The blog of the South Carolina Policy Council

Senate Budget Contains Additional $1.6 Billion in Hidden Spending?

with 2 comments

Next week, the Senate will be debating the full budget. The Senate Finance Committee has already met and published its list of provisos, amended and new, based on the House budget.

Here’s a quick look at the good and the bad: 3 good; 1 bad. But don’t be misled … the bad far outweighs the good. Read on to learn more:

The Good

1)     89.112 – The Senate is striking the House’s proposal to provide a $10 million loan to Beaufort County for the Verizon Heritage Golf Tournament. As reported in The Nerve, this is a controversial and wildly inappropriate use of taxpayer funds.

2)     80A.7 – This proviso allows the Budget & Control Board (BCB) to eliminate any government position left vacant for 12 months. The House budget would suspend this requirement for FY10-2011. The Senate amendment allows the BCB to continue the practice. Government should be maximizing efficiency – and if an agency has survived for more than 1 year without a certain position, chances are it can continue to do so.

3) – A new addition by the Senate Finance Committee, this proviso requires that after each quarterly deficit review, any agency likely to have a deficit must submit a plan within 14 days that would minimize or eliminate the deficit. If there is no feasible plan, the agency has 30 days to notify the BCB of the situation. This proviso should encourage more transparency and accountability among agencies.

The (Really) Bad

1)     89.87 – This is the general flexibility proviso that allows agencies to use restricted and earmarked (Other Funds) to “maintain critical programs previously funded with general fund appropriations.” The House version of this proviso allows agencies to spend up to the prior fiscal year appropriation level (FY09-2010). But the Senate version changes this to FY08-2009. This one change would increase spending by roughly $1 billion, draining Other Funds by a proportionate amount.

Here are the appropriation figures from the two fiscal years, according to the Budget and Control Board:

— 2008-2009: $6,735,714,190
— 2009-2010: $5,714,023,234

The House budget is roughly $5.1 billion. But this proviso, in essence, allows agencies to dig through reserves and other funds to bump spending up to $6.7 billion. This is about as un-transparent as legislators can get. The General Assembly should be voting on the true budget – not passing a $5.1 billion version and then providing vague wording that could open the door to $1.6 billion in additional expenditures.

Stay tuned for more budget coverage as the General Assembly comes back to Columbia next week.


Written by Geoff Pallay

April 9, 2010 at 1:12 pm

2 Responses

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  1. Isn’t this the kind of accounting that brings down corporations?


    April 12, 2010 at 8:47 am

  2. […] Flexibility proviso, 89.87, authorizes an additional $1 billion in government spending – money that is not technically allocated in the budget. The Senate budget allows agencies to use Other Funds to make up for General Fund shortfalls – dating back to FY08-2009 levels ($6.7 billion). […]

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