State might have extra money to work with

By Jim Davenport

The Associated Press

COLUMBIA - A revised revenue estimate expected Friday could pump more than $110 million into the spending plan that House budget writers will work on next week.

But hopes that money from a higher Board of Economic Advisors revenue estimate could go to law enforcement, schools or health care could be squelched by House plans for property tax cuts that would add $117 million to state spending in the first year alone.

House Speaker Bobby Harrell won't link the need for the extra cash to the property tax bill he pushed through the House last week.

Even without the good news, the House would have to include the property tax spending in the budget. "Will it make it easier if the Board of Economic Advisors says there's more revenue? Sure it does. But that isn't the point at all," Harrell said.

The point, Harrell said, is that "the property tax relief is very important" and the House has taken action. Property tax relief costs are expected to grow to more than $396 million by 2009-10, board projections show.

The revised revenue estimate, which was created by a growing economy despite persistently high unemployment, is the second round of good budget news since November, when the board said it expected $310 million in new revenue for the 2007 fiscal year, which begins in July.

The changes lift the S.C. general fund budget above $6 billion - but that's about where the state's spending was in 2000 before a recession, said Ways and Means Committee Chairman Dan Cooper, R-
Piedmont.

The recession and sluggish recovery prompted agency spending cuts, raids on state trust funds and huge increases in state fees and fines.

Cooper says he'd like to see extra money restored to some agency budgets that are "still trying to play catch-up."

Cooper also wants a pilot program for early childhood education that addresses a judge's decision in a school-funding lawsuit. Democrats are looking for a broader program.

Rep. Gilda Cobb-Hunter, an Orangeburg Democrat and budget committee member, wants the state to put more money into Medicaid programs as a way of providing more health care protection for low-income people.

"The worst thing we could do is take this new revenue and plug that hole in the property tax relief," Cobb-Hunter said. "If they're committed to property tax relief, find the resources to do it."

Senate Finance Committee Chairman Hugh Leatherman has repeatedly criticized the House's property tax plans, vowing that whatever relief his committee approves will be balanced. Leatherman also says the state's revenues are expected to slow during the next two years, sending the state down the budget-cutting path again.

"We'll be extremely careful about what we do" with the extra cash, said Leatherman, R-Florence. That means "certainly not expanding programs; certainly not creating programs," he said.

House Minority Leader Harry Ott, a St. Matthews Democrat, says the state needs to spend more on the Commerce Department to lower the state's unemployment rate.

In December, South Carolina's 7 percent jobless rate was second only to Mississippi, a state recovering from Hurricane Katrina. "The numbers don't lie. The numbers say we are second-worst in the country in unemployment," Ott said.

email this

print this