House Proposes to Boost its Budget by $2.3 Million

July 17, 2015

Investigative Reports

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The NerveThe S.C. General Assembly’s love of giving itself multimillion-dollar budget hikes is once again in full bloom.

A year after the Senate received a $5 million overall budget increase for its 46-member chamber – as first reported last year by The Nerve – the 124-member House is seeking a nearly $2.3 million hike for itself, which was quietly slipped in a state budget amendment on the last day for regular business this legislative session.

The House’s proposed $18.68 million budget represents a nearly 14 percent increase over the chamber’s adjusted appropriation for this fiscal year, a review by The Nerve found. Earlier versions of the fiscal year 2012 state budget would have kept the House chamber’s budget at this year’s adjusted appropriation of about $16.4 million.

The Nerve’s review of Office of State Budget records found that after subtracting unspent funds, the House’s total annual revenues have averaged $13 million since fiscal year 2007.

More than $2.8 million in unspent tax dollars was carried over into this fiscal year; the average carryover amount since fiscal year 2007 has been $2.5 million, The Nerve’s review found. The House’s proposed fiscal year 2012 budget for itself doesn’t reflect carryover funds.

The new fiscal year starts July 1. A joint conference committee of both chambers last week began working on resolving differences between their versions of the state budget.

Rep. Garry Smith, R-Greenville and chairman of the House Operations and Management Committee, told The Nerve last week that the proposed hike for his chamber would make up for cuts in recent years. He contended that compared to the Senate, the House has been more frugal with its own spending during the Great Recession.

“The Senate has been living a bit large, and the House has been leading by example,” Smith said. “We have been cut. We’ve cut staff. We’ve cut salaries.”

“When you couple that with what is happening in the building next door (the Senate), it has created a morale problem (among House staff),” Smith continued, noting that some departed House staffers were hired by the Senate.

Smith, however, could not provide any details on the number of House staff members who have lost their jobs or staff salary cuts, referring those questions to House Clerk Charles Reid. Smith also couldn’t answer why the House couldn’t live with its current $16 million appropriation for next fiscal year.

Reid; House Speaker Bobby Harrell, R-Charleston; and Rep. Dan Cooper, R-Anderson and chairman of the budget-writing House Ways and Means Committee, did not return phone and written messages last week from The Nerve.

The House in March initially passed a nearly $16.4 million budget for its chamber for the next fiscal year, and the Senate approved the same amount last month in passing its version of the state budget.

But when the state budget went back to the House with the Senate’s amendments, the chamber in a 70-41 vote on June 2 – the last day for regular business this legislative session – approved an amendment sponsored by Cooper making changes to various state agencies, including the House chamber.

The amendment added $1,289,600 for House salaries and $1 million for “other operating expenses,” bringing the chamber’s proposed budget for the fiscal year 2012 to $18,684,810.

Smith said the proposed approximate $1.3 million for House salaries does not mean representatives would be getting any raises beyond their base $10,400 annual salary (The Nerve reported in a special series in October that lawmakers receive other forms of compensation above their base salary, including up to $12,000 per year for “in-district” expenses, thus significantly increasing their legislative pay).

Rather, Smith said the $1.3 million would restore what former Gov. Mark Sanford vetoed last year (which the House sustained), adding that House salaries for this fiscal year are being covered out of the chamber’s reserve accounts.

The proposed additional $1 million for “other operating expenses” would be used for reapportionment, or the redrawing of legislative and congressional district lines as a result of the 2010 U.S. Census, Smith said. The funding would cover “computer equipment, legal consultants, as well as per-diem” payments to House members for returning to Columbia to work on a redistricting bill, he said.

Sanford vetoed the proposed reapportionment expenditure. As with the line item for House salaries, the House sustained that veto.

“The House agreed to cover these costs out of reserves as a way to help the budget situation,” House Majority Leader Kenny Bingham, R-Lexington, told The Nerve last week in a written response, referring to Sanford’s vetoes.

“With additional revenue projections that the BEA (state Board of Economic Advisors) authorized after the budget left the House, it made it possible to restore the funding of these two items in this year’s budget,” he said.

Bingham referred further questions to Smith, Cooper and Harrell, pointing out that he does not serve on Smith’s committee and does not “manage the House operations budget.”

The House recently found additional money for itself with better-than-expected general fund revenues for this fiscal year, Smith said. The projected year-end surplus for the state in the House’s amended version of the state budget is $173.8 million, compared to $68.8 million when the House passed its initial version in March, according to records from the Office of State Budget. In addition, the state carried over a $71 million surplus from fiscal year 2009-10.

If the proposed approximate $18.7 million House chamber budget for 2012 survives the budget conference committee that began meeting last week, it would jump by 36 percent from the chamber’s ratified $13.7 million budget in fiscal year 2007-08, when the Great Recession began.

In comparison, if the latest House version of the state budget is approved, the state’s ratified general fund budget will have dropped to $5.45 billion from $6.7 billion since fiscal year 2009, a decrease of about 19 percent. (The Nerve pointed out in a story last month there are other pots of tax dollars that are not included in the annual state budgets listed on the General Assembly’s website.)

The proposed hike in the House’s funding for next fiscal year comes on top of a $2.7 million, or 20 percent, increase in the chamber’s ratified budget in fiscal year 2009-10. That year, the ratified base budget jumped to $16.1 million from $13.4 million.

Smith pointed out that his chamber’s budget was slashed about 18 percent in fiscal year 2009-10. But that reduction reflected a transfer of $2.8 million in unspent funds to this fiscal year on top of cuts of $1.4 million, according to The Nerve’s review of Office of State Budget (OSB) records.

The OSB records show that the House carried over about $2.8 million in unspent general funds in fiscal year 2007, $3.3 million in fiscal year 2008 and $1.1 million in fiscal year 2009. If the House carries over $2.8 million in unspent general funds from this fiscal year into next year, it would have about $21.5 million available to spend next year, assuming that the latest House version is approved.

The Nerve last year detailed how the Legislature hiked the Senate chamber’s ratified operating budget for this fiscal year by 46 percent, to $12.3 million from $8.4 million. That didn’t include a separate $1 million appropriation for reapportionment, giving the chamber an adjusted total budget, including a nearly $80,000 “supplemental” appropriation, of $13.4 million, records show.

Sanford vetoed most of the increase, but the Legislature overrode it.

The $5 million budget increase helped cover pay raises for Senate staffers, The Nerve reported in a special series in November. At the beginning of the current fiscal year on July 1, seven Senate employees received double-digit salary increases, with one of them getting a 22 percent hike.

In addition, virtually all Senate staffers whose salary exceeds $50,000 received raises in each of the past two fiscal years, despite the recession, The Nerve’s investigation found.

By comparison, the last cost-of-living increase for state workers was a 1 percent hike in 2008, according to S.C. Budget and Control Board records.

Reach Brundrett at (803) 254-4411 or rick@thenerve.org.