While legislators haven’t yet hammered out the final details of the 2012-13 spending plan, the state appears ready to set a record as lawmakers are debating a total base budget (excluding non-recurring provisos) of $22.8 billion.
That would be $950,000 more than last year’s then-record base budget of $21.9 billion, despite the fact Palmetto State residents were struggling through the Great Recession.
With a particular interest in state budget issues, Atkinson emailed questions to Gregory earlier this month to provide this report on the senator’s responses. Atkinson is one of Gregory’s constituents.
The following is from their correspondence about the budget:
Q: Do you know that the state budget has hit record levels for each of the past few years, even during the recession, due in part to federal funds and other funds?
Gregory: I am aware of this. Some of it we control. Most it we have limited control, at best, over. Much of the growth came from stimulus funds. I was not in the Senate when the body elected to take these funds over (former) Gov. (Mark) Sanford’s objections. This has resulted in huge growth in Medicaid funds which the state must match. That is straining our budget, but I am told by folks in the Governor’s Office there is no way to extract ourselves from this. The best we can hope for is that Congress will block-grant the funds to us and allow us latitude to make our own way.
The state’s General Fund – what we control directly – has gone from roughly $7 billion to $5 billion and back to $6 billion.
Q: What do you think of (the growing budget)?
Gregory: I don’t think that it is a good thing, but much of it is beyond our control.
Q: Is it good or bad for South Carolina that no matter what the condition of the overall economy, our budget continues to hit new highs?
Gregory: The population of the state continues to grow, so tax collections will track that to a certain extent. More people than ever are going to college, so that swells revenue to public institutions. South Carolina is one of 12 states with a AAA credit rating, so we are in better shape than 75 percent of the other states. The number of state employees is down 20 percent from its peak and they have not had a raise in three to four years, so we have not been expanding the number of government employees through the General Fund.
We do have significant problems with deficits for unemployment insurance, the state employee retirement system and retirement health care. I feel we should target these deficits with surplus revenues. I also am in favor of giving a raise to state employees this year.
Mary Atkinson is a Citizen Reporter for The Nerve and a resident of Lancaster.