Date Posted: April 12, 2003

Senate to tackle state budget

By BRADEN BUNCH
Item Staff Writer

   The South Carolina Senate will tackle the budget in the coming week, while House members take the week off.
   The approximate $5 billion spending plan is expected to remain in committee during the coming week before hitting the Senate floor, and the two local senators said they have a tremendous amount of work ahead of them to develop the plan.

LEVENTIS

LAND

   Both Sen. Phil Leventis, D-Sumter, and Sen. John Land, D-Manning, said they were not aided by the plan passed out earlier in the session by the House.
   “The House version is not a budget,” Leventis said. “The House version is a political statement.”
   Leventis added that the House plan shortchanges far too many programs, especially education, which has been taken back by the House to 1994 levels.
   “That’s all well and good, except we’re trying to compete in a 2003 economy,” the senator said.
   Leventis also said he would work to keep the Senate’s version of the budget from tapping into various trust funds, including the fund set up to manage the cleanup of the Safety-Kleen hazardous waste site near Rimini, to finance state programs.
   Despite the efforts of local representatives, the House budget calls for nearly $12 million to be taken from the Safety-Kleen trust fund to finance several Department of Health and Environmental Control programs.
   Leventis also added that the House’s proposal to refinance the tobacco bonds would not work as a source of funds and could, in fact, end up costing the state money.
   “It just didn’t make a bit of sense for them to do that,” Leventis said.
   To find income from other means, the Senate Finance Committee unanimously passed a proposal by Land that combines several ideas thrown out during the past year.
   The proposal, approved by the committee Tuesday, calls for a 53-cent cigarette tax increase coupled with a delayed decrease in the South Carolina income tax.
   The cigarette tax increase would raise the state’s tax rate to 60 cents per pack and would raise an estimated $171 million if approved. As part of the proposal, those funds would be dedicated to funding Medicaid programs.
   Gov. Mark Sanford, who had previously said he would veto any increase in the cigarette tax if it was not coupled with a corresponding decrease in income tax, had initially asked that the income tax break become effective immediately.
   Land said such a break would cost $90 million dollars that the government cannot afford at this time.
   Instead, the committee agreed with Land that the income tax rate should be lowered from its current 7 percent level once the state’s economic growth brings income back to the 2000 level, when the state took in nearly $2.5 billion in income taxes.
   The senator said it might take the state three years to reach those previous levels.
   “The governor got what he wanted, not exactly when he wanted it, and those of us that felt the Medicaid program should be funded as much as possible were willing to go with the cigarette tax,” Land said. “Even though I have a lot of tobacco farmers in my district, I also have a lot of poor people that benefit from these services.”
   One of the goals of the Sanford income tax relief plan is to eventually lower state taxes to 5 percent.
   The House is taking a self-imposed weeklong furlough during the coming week. When lawmakers return, there will be seven weeks left in the current session.

   Contact Staff Writer Braden Bunch at bradenb@theitem.com or 803-774-1222.

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