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There's no state surplus until trust funds are repaid

Unexpected revenue must go to pay old debts

Published Thursday, November 18th, 2004

South Carolina should be in a good position with state government revenue finally picking up, and a forecast for more good news in the next fiscal year.

But it is not.

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The reason is simple. The legislature has raided trust funds in recent years to balance the budget. Now that money must be put back where it belongs.

It's a shame it has to be that way because revenue growth is needed to meet the need for front-line services that increase with the economic expansion. The economic growth should help pay for more troopers, teachers and social workers, particularly in light of drastic cutbacks over the past three years.

But it is telling that, upon hearing the good news about income, legislators quickly listed ways the "surplus" could be spent: new school buses, prescription drugs, college buildings, etc.

They must recognize that the money is not a surplus until the foolish raids of trust funds is rectified.

Gov. Mark Sanford surely will recognize this when he prepares the executive budget. His spokesman says the state faces a total of $428 million in past-due obligations.

The largest chunk of that comes from the cleanup fund for the low-level radioactive waste disposal site at Barnwell. That trust is owed almost $100 million, and it is crucial that it be refunded.

State leaders must show the maturity and responsibility it takes to do what is necessary, not what is flashy. It cannot have its cake and eat it, too. It cannot reap money from the ill-advised collection of radioactive waste, and at the same time pilfer the money needed to deal with that disposal in the future.

Also, the legislature has taken millions from the Insurance Reserve Fund, and it has not replenished the State Health Plan reserve.

Replacing that money is a one-time expense that would be a perfect use for unexpected income.

State Sen. Scott Richardson, R-Hilton Head Island, is one of the lone voices of reason in the General Assembly on this matter. He recognizes the trust raids for what they are.

"All we've done is hide the financial condition of this state," he said during the last legislative session.

The trust funds and reserve funds have to be replenished. To pretend otherwise is irresponsible.

Because legislators think paying off debt is so painful, they need to face tighter constraints on touching the reserves and trusts to begin with. Existing restraints seem to be ignored.

State government is required to live within its means. That must be done honestly, by counting as debt the money raided from trust funds and reserves. That debt must be repaid.

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