Senate Finance Committee Extra Generous to 9 Agencies

May 24, 2012

Investigative Reports

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12d91c028184fdff687bea450b7afad3The state budgeting process would seem at first blush relatively simple: An agency determines what it thinks it needs for the coming year based on anticipated revenues and expenditures and submits a request.

The Legislature, which finalizes the budget, would, in theory, either approve an agency’s request; or, if money were tight or lawmakers deemed the request extravagant, grant a lesser amount.

However, theory and reality sometimes have a way of diverging when it comes to finances and the General Assembly.

As the process of putting together the 2012-13 budget winds down – it’s currently being debated by the Senate – a number of state agencies appear on track to receive more general fund dollars than they originally requested. Some could get much more, in fact.

Take the S.C. Department of Commerce: In this fiscal year, the department was appropriated $3.9 million in general funds. For the upcoming year, which begins July 1, it requested $12.7 million, a substantial increase in itself.

Apparently, though, that wasn’t enough for lawmakers. By the time the Senate Finance Committee was done, another $12 million in general funds had been added to Commerce’s proposed budget, doubling what the agency requested and representing a general fund increase of 536 percent over 2011-12.

In all, nine state agencies have been approved by Senate Finance for general fund growth of 100 percent or more. Several of these either sought no boost in general funds when they submitted their budget requests late last year, or asked for far less of an increase than what the Senate Finance Committee ended up awarding.

All of which sounds like anything but sound fiscal policy to Leslie Paige, vice president for policy and communications for Citizens Against Government Waste, a Washington, D.C.-based nonprofit that seeks to eliminate waste, mismanagement and inefficiency in government.

“Just because you’re in the black doesn’t mean you have a green light to go hog-wild with the budget,” she said. “This is exactly how you get into a deficit situation.”

Sen. Hugh Leatherman, R-Florence and chairman of the Senate Finance Committee, could not be reached for comment for this story.

The Senate Finance Committee’s budget for the coming year would boost general fund spending 12 percent over this fiscal year to $6.11 billion from $5.45 billion.

Overall, Senate Finance has approved a $23.6 billion state budget, which includes federal funds and “other” funds, and would be the largest in South Carolina history. That’s 5 percent more than 2011-12.

The full Senate is still debating the budget. Once it passes its version, the House and Senate will likely work out a compromise plan to go to Gov. Nikki Haley.

Another agency that’s probably smiling after seeing the Senate Finance Committee budget is the Department of Employment and Workforce.

The agency requested $343,959 in general funds for the coming fiscal year, the same amount it received for this fiscal year. That was good enough for the House Ways and Means Committee; but between the full House and Senate Finance, the agency’s proposed general fund appropriation swelled to $794,885, a 231 percent increase.

The State Election Commission, unlike DEW, sought an increase in funding for the coming year in anticipation of the November elections.

Both the House and the Senate Finance Committee appropriated roughly $3 million for 2012-13. The Election Commission requested the funds from non-recurring revenue, but Senate Finance funded the request completely with general funds, while the House split the amount between general funds and non-recurring revenue.

Another agency looking at a big bump is the Lieutenant Governor’s Office. The agency, which oversees the Office on Aging, requested $4 million in general funds for the coming year, an increase of a little more than $15,000.

But after Senate Finance got done with its budget version, the Lieutenant Governor’s Office would be on track to receive nearly $9.6 million in general funds, 138 percent more than it requested.

Some other big winners in terms of general fund increases between what was appropriated this fiscal year and what’s being proposed by Senate Finance for the coming year:

  • S.C. Aeronautics Commission was appropriated $536,093 in general funds for 2011-12 and is in line for $1.3 million for the coming year;
  • S.C. Attorney General’s Office was appropriated $3.6 in general funds for this year and is line for nearly $8 million for 2012-13;
  • State Ethics Commission was appropriated $257,583 in general funds for this year and is in line for $557,898 for the coming year;
  • The Commission on Indigent Defense was appropriated nearly $8.5 million in general funds for this year and is in line for $17.8 million for 2012-13; and
  • S.C. Department of Insurance was appropriated $1.9 million in general funds for this year and is in line for $3.6 million next year.

In addition to the Department of Employment and Workforce and the Lieutenant Governor’s Office, the Commission on Indigent Defense, the Insurance Department and the State Ethics Commission each requested either no increase in general funds, or a small increase when they submitted their budgets.

“Why would you give an agency two or three times what they requested?” asked Paige, of Citizens Against Government Waste. “It’s going to be awfully hard to cut that budget later, once it becomes institutionalized and becomes the norm.”

Reach Dietrich at (803) 779-5022, ext. 110, or kevin@thenerve.org.