June 27, 2001
The Honorable David H. Wilkins, Speaker
South Carolina House of Representatives
State House
Columbia, South Carolina 29201

Dear Mr. Speaker and Members of the House:

I am returning H. 3687, Ratification #147, the General Appropriations Act for Fiscal Year 2001-02 with my vetoes.

Fiscal Year 2001-02 represents the first year of a biennial cycle where we will permanently downsize state government. This budget cuts $270 million of funding from a year ago, largely due to the legislature's practice of over-promising and over-spending. Next year will not be an easy one as we are faced with difficult choices.

Cuts of this magnitude could potentially pass along costs to most of our families. Given my desire to provide our citizens access to quality education, I am vetoing the base budget reductions for higher and public education. We cannot afford to balance the budget on the backs of students and their parents.

Preliminary indications are that we will be faced with similar decisions in FY 2002-03, but hopefully the extent of further cuts will be smaller. Nevertheless, agencies must continue to downsize and seek efficiencies.

My vetoes are as follows:

Veto #1. Part IA, Section 5-C, The Citadel, Page 32, Item Base Reduction $2,114,447 I am vetoing the budget cut for The Citadel so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #2. Part IA, Section 5-D, Clemson University, Page 35, Item Base Reduction $14,285,036 I am vetoing the budget cut for Clemson so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #3. Part IA, Section 5-E, University of Charleston, Page 37, Item Base Reduction $3,832,413 I am vetoing the budget cut for the University of Charleston so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #4. Part IA, Section 5-F, Coastal Carolina, Page 39, Item Base Reduction $1,598,624 I am vetoing the budget cut for Coastal Carolina so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #5. Part IA, Section 5-G, Francis Marion University, Page 41, Item Base Reduction $1,878,687 I am vetoing the budget cut for Francis Marion so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #6. Part IA, Section 5-H, Lander University, Page 44, Item Base Reduction $1,261,825 I am vetoing the budget cut for Lander so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #7. Part IA, Section 5-J, South Carolina State, Page 46, Item Base Reduction $3,355,228 I am vetoing the budget cut for South Carolina State so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #8. Part IA, Section 5-KA, University of South Carolina, Page 51, Item Base Reduction $24,545,154 I am vetoing the budget cut for the University of South Carolina so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #9. Part IA, Section 5-KB, USC Aiken, Page 54, Item Base Reduction $1,276,429 I am vetoing the budget cut for USC Aiken so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #10. Part IA, Section 5-KC, USC Spartanburg, Page 56, Item Base Reduction $1,509,885 I am vetoing the budget cut for USC Spartanburg so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #11. Part IA, Section 5-KD, USC Beaufort, Page 58, Item Base Reduction $283,563 I am vetoing the budget cut for USC Beaufort so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #12. Part IA, Section 5-KE, USC Lancaster, Page 60, Item Base Reduction $347,391 I am vetoing the budget cut for USC Lancaster so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #13. Part IA, Section 5-KF, USC Salkehatchie, Page 62, Item Base Reduction $280,066 I am vetoing the budget cut for USC Salkehatchie so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #14. Part IA, Section 5-KG, USC Sumter, Page 64, Item Base Reduction $519,027 I am vetoing the budget cut for USC Sumter so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #15. Part IA, Section 5-KH, USC Union, Page 66, Item Base Reduction $136,684 I am vetoing the budget cut for USC Union so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #16. Part IA, Section 5-L, Winthrop University, Page 68, Item Base Reduction $3,001,700 I am vetoing the budget cut for Winthrop so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #17. Part IA, Section 5-MA, Medical University of South Carolina, Page 70, Item Base Reduction $6,623,237 I am vetoing the budget cut for the Medical University of South Carolina so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #18. Part IA, Section 5-MC, Consortium of Community Teaching Hospitals, Page 72, Item Base Reduction $2,031,657 I am vetoing the budget cut for the Consortium of Community Teaching Hospitals so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #19. Part IA, Section 5-N, Technical and Comprehensive Education, Page 76, Item Base Reduction $20,056,936 I am vetoing the budget cut for the technical colleges so this funding can be restored. Our state cannot achieve success without proper funding of higher education.

Veto #20. Part IA, Section 1, Department of Education, Page 16, Item Base Reduction $4,521,968 I am vetoing the budget cut for public education so these funds can be used for critical school bus transportation needs. The Department of Education has agreed to use these funds for this purpose.

Veto #21. Part IB, Section 72, Page 482, Proviso 72.111, Item H63 Department of Education $422,405 I am vetoing this item so these funds can remain with the Department of Education to further address school bus transportation needs.

Veto #22. Part IB, Section 72, Page 482, Proviso 72.111, Item H67 ETV $409,096 I am vetoing this item so these funds can remain with ETV and be used for educational purposes.

Veto #23. Part IB, Section 72, Page 482, Proviso 72.111, Item H71 Wil Lou Gray $11,638 I am vetoing this item so these funds can remain with Wil Lou Gray and be used for educational purposes.

Veto #24. Part IB, Section 72, Page 482, Proviso 72.111, Item H75 School for the Deaf and Blind $29,120 I am vetoing this item so these funds can remain with the School for the Deaf and Blind and be used for educational purposes.

Veto #25. Part IB, Section 72, Page 482, Proviso 72.111, Item L12 John de la Howe School $88, 515 I am vetoing this item so these funds can remain with the John de la Howe School and be used for educational purposes.

Veto #26. Part IB, Section 54, Page 426, Proviso 54.48 I am vetoing this proviso because it violates the condition agreed to when these funds were first appropriated. These funds should lapse to the General Fund as originally intended.

Veto #27. Part IB, Section 56DD, Page 432, Proviso 56DD.38 I am vetoing this proviso so these funds can be used for Victim Assistance programs.

Veto #28. Part IB, Section 1, Page 347, Proviso 1.69 I am vetoing this proviso because my previous vetoes render this proviso moot.

Veto #29. Part IB, Section 24, Page 396, Proviso 24.13 I am vetoing this proviso because it mandates an unnecessary transfer.

Veto #30. Part IB, Section 36, Page 408, Proviso 36.18 I am vetoing this proviso because it mandates an unnecessary transfer.

Veto #31. Part IB, Section 37, Page 411, Proviso 37.21 I am vetoing this proviso because it mandates an unnecessary deletion.

Veto #32. Part IB, Section 63, Page 448, Proviso 63D.5 I am vetoing this proviso because it mandates an unnecessary transfer.

Veto #33. Part IB, Section 64, Page 453, Proviso 64.14 I am vetoing this proviso because it mandates an unnecessary transfer.

Veto #34. Part IB, Section 1, Page 347, Proviso 1.64 I am vetoing this proviso because school administrators know best the needs of their schools. Districts should be given flexibility to design appropriate activities for non-instructional days.

Veto #35. Part IB, Section 1, Page 347, Proviso 1.71 I am vetoing this proviso because each First Steps local partnership should be afforded the opportunity to implement its approved school readiness program. The First Steps Board is in the best position to determine the allocation of funds that provide for all of South Carolina's children.

Veto #36. Part IB, Section 1, Page 347, Proviso 1.74 I am vetoing this proviso because it places an additional requirement on schools without any additional state funding. In addition, many schools mail report cards directly to parents, so the requirement is unnecessary.

Veto #37. Part IB, Section 1, Page 359, Proviso 1A.67 I am vetoing this proviso to insure consistency and to insure that all parents receive school report cards. The State Department of Education should be allowed to mail the report cards to each parent.

Veto #38. Part IB, Section 8, Page 374, Proviso 8.45 I am vetoing this proviso for two reasons. First, this proviso duplicates the waiver requirement contained in the FY 2000-2001 Appropriations Act, Part II, Section 47 that mandated the Department of Health and Human Services pursue a federal waiver to expand our seniors prescription drug program. The South Carolina Department of Health and Human Services has already submitted a draft proposal to the Health Care Financing Administration for an 1115 waiver to expand prescription drug coverage to South Carolina seniors. To date, federal officials have met to discuss this waiver and have transmitted questions back to the state. Further meetings and discussions between state and federal officials are anticipated in the near future as we pursue federal matching funds for prescription drugs for seniors. Secondly, I am vetoing this proviso because it is far too prescriptive in that it establishes deductibles and copays and thereby limits the state's flexibility in negotiating with federal officials in the design of a cost-effective seniors prescription drug program.

Veto #39. Part IB, Section 63, Page 442, Proviso 63B.13 I am vetoing this proviso because it is premature and unnecessary at this time. The Department of Health and Human Services has submitted a waiver request to the federal government to obtain federal funds to expand our seniors prescription drug program. The federal government, since it will supply federal funds for this expansion, may play a role in determining the design and administration of such an expanded program. Therefore, it would be more appropriate for administrative decisions to be determined after federal waiver approval is obtained.

Veto #40. Part IB, Section 72, Page 478, Proviso 72.98 I am vetoing this proviso because a study committee is unnecessary. South Carolina Code Section 44-130-40 requires that the Budget and Control Board administer our seniors prescription drug program. Since this entity is charged with implementation of this program, it is not necessary to create a study committee to make wholesale administrative and other changes pertaining to this prescription drug program.

Veto #41. Part IB, Section 72, Page 483, Proviso 72.111, Item H03 CHE Performance Funding $20,000,000 Given my veto of the base budget reduction to the colleges and universities, this supplemental appropriation can be removed and is also necessary to keep the budget in balance.

Veto #42. Part IB, Section 32, Page 402, Proviso 32.10 I am vetoing this proviso because these funds should be used for their intended purposes.

Veto #43. Part IA, Section 54A, Page 254, Item Operations and Management $30,000. I am vetoing this amount as one of several items to equal the amount added to the budget for redistricting. Congressional and legislative redistricting could have been performed in the previous session and based upon the House's precedent ten years ago, no extra appropriations are necessary to complete the task. My veto is directed to the items that total the amount added for redistricting and is not intended to impair Senate operations and management. I would support any transfers within remaining funds needed to accomplish this item.

Veto #44. Part IA, Section 54A, Page 254, Item In District Compensation $552,000. I am vetoing this amount as the second of three items that equal the amount added to the Senate budget for redistricting for the reasons previously stated. Again, I would support transfers within the remaining funds needed to accomplish this item.

Veto #45. Part IA, Section 54A, Page 254, Item National Conference State Legislatures $116,715. I am vetoing this amount as the third of three items that equal the amount added to the Senate budget for redistricting for the reasons previously stated. Again, I would support transfers within the remaining funds needed to accomplish this item.

Veto #46. Part IA, Section 54B, Page 256, Item Reapportionment $878,000 I am vetoing the House budget increase for redistricting for the reasons previously stated.

Veto #47. Part IB, Section 72, Page 477, Proviso 72.89 I am vetoing this proviso to keep tax laws consistent with Veto #48.

Veto #48. Part IB, Section 72, Page 477, Proviso 72.90 I am vetoing this proviso so the budget cuts to public and higher education can be restored. Consequently, I expect our colleges and universities to repeal any exorbitant tuition increases. I am disappointed that the General Assembly did not adopt other more effective tax relief such as the additional Sales Tax holiday.

Since I have vetoed the base budget reductions to higher education, the supplemental appropriations contained in Proviso 72.109 are not necessary to reduce cuts. These appropriations, however, must be reduced in order to balance the state budget. I have not vetoed these items because the colleges and universities have agreed to return these amounts to the general fund to accomplish this purpose.

In closing, I would like to commend the General Assembly again for working with me to address the needs of our citizens.

Sincerely,

Jim Hodges