COLUMBIA, S.C. - South Carolina's top financial officers will discuss Wednesday how and when to address $177 million in deficits left over from the past two fiscal years.

The Budget and Control Board also will have to decide whether to tap reserves after an advisory panel said tax collections and other state revenues are expected to fall $108 million short of expectations in the current fiscal year.

Board members have spent the past two weeks talking with lawyers to determine what the can do legally.

"You have to get legal advice. This is uncharted territory," House Ways and Means Committee Chairman Bobby Harrell, R-Charleston and a member of the budget board, said.

But different members of the board have been getting different advice.

Gov. Mark Sanford's office and Comptroller General Richard Eckstrom have said they want immediate budget cuts to cover the $155 million in deficits from the 2002 fiscal year and $22 million in deficits from the fiscal year that ended June 30. Eckstrom says the deficits violate the state Constitution's budget standards.

"I certainly intend to encourage us to deal forthrightly with the red ink we have hung out on our balance sheet right now," Eckstrom said. "My hope is that we take the bad medicine tomorrow."

Sanford's office did not immediately respond Wednesday to questions about the deficits.

Senate Finance Committee Chairman Hugh Leatherman, R-Florence, said the budget board may not be able legally to address the $155 million deficit.

"I think it's a question for another day," Leatherman said. "I don't think the board has the authority to go back and deal with that."

The law says the board can only cut spending to head off future shortfalls and the $22 million deficit announced two weeks ago, Leatherman said.

Harrell says he is waiting for a legal briefing and board discussion Wednesday. "I'm holding off on a decision until that occurs," he said.

Board members agree the rainy-day fund needs to be tapped to avert a shortfall for the current fiscal year. "I can't imagine anybody that's going to be opposed to doing that," Harrell said.

But even after tapping the capital reserve fund, a $10 million projected shortfall would remain, Leatherman said. And the board has to decide how to handle the $22 million deficit that Eckstrom announced two weeks ago.

Leatherman says the board could tell agencies to set aside 1 percent of their budgets to deal with those two issues.

Trav Robertson, an aide to State Treasurer Grady Patterson, says the treasurer hasn't decided what types of cuts, if any, he'll support. Patterson, the budget board's lone Democrat, was reviewing legal advice Tuesday and had not decided to support covering both years of deficits or something less than that.

Not dealing with the $155 million deficit "may send a bad message to the rating agencies," said Don Weaver, president of the South Carolina Association of Taxpayers. South Carolina's AAA credit rating saves money when the state has to borrow. Delays "could set up a bad circumstance for the taxpayers in the future," Weaver said.

Two years of deficits mean "we're playing very close to the edge on this," Eckstrom said.

Patterson wants to maintain the state's credit rating "without sending shock waves of laying off thousands of workers in an already depressed economy in South Carolina," Robertson said.