COLUMBIA--The state's top financial leaders say they have a plan to repay the $155 million deficit from fiscal year 2001-2002 and create greater spending discipline to ensure the state has a balanced budget.

The five members of the state Budget and Control Board on Tuesday proposed tapping into the state's capital reserve fund and general reserve fund during the next three budget years to repay the shortfall.

The repayment plan will be introduced when the General Assembly meets in January.

"I think it's an absolute must for the future of South Carolina," said Senate Finance Committee Chairman Hugh Leatherman.

South Carolina's Constitution requires a balanced budget. But the panel says weak laws and loopholes have left the state unable to deal with its deficit from two years ago.

Republican Gov. Mark Sanford said uncontrolled spending put the state in a budget crisis, and now the deficit could hurt the state's top credit rating.

"This is a unified front for protecting the best interests of the taxpayers of South Carolina," said Sanford, the board's chairman. "This plan goes a long way toward reining in that spending, in addition to getting us out of a fiscal hole that could have cost us our AAA credit rating."

Sen. John Land, D-Manning, said it was good to maintain the state's credit rating, but the panel's plan still cuts $155 million from state agencies.

"When you take from those funds, you automatically have to put money back in," Land said.

The plan also would cap growth in the state budget at 3 percent a year until 2009.

But the state could pay off the deficit faster if the economy picks up, said House Ways and Means Chairman Bobby Harrell, R-Charleston. Any state revenue growth above 3 percent would be used to pay down the deficit.

"We all recognize it won't be easy," said state Treasurer Grady Patterson, a Democrat. "There's going to be a lot of hardships involved in it."

The capital reserve fund is used to fund bond bills and building projects across the state.

"As important as they are, we have an even greater responsibility to clear this up," Sanford said.