The 2 percent reduction brings the revenue estimate down to $5.4 billion, the same amount the state took in during the fiscal year that ended June 30.

The estimate reduction could prompt the state Budget and Control Board to tap a $98.6 million rainy day fund when it meets Wednesday. The board already planned to discuss $177 million in deficits left from the past two fiscal years.

The board is made up of Gov. Mark Sanford as chairman and the state's top four financial officers. Sanford and Comptroller General Richard Eckstrom want immediate budget cuts to cover the deficits.

Eckstrom wanted the Board of Economic Advisors to consider the deficit in deciding whether to reduce its revenue estimate, but board Chairman John Rainey said the deficit couldn't be part of the decision to lower the revenue estimate.

"When you start talking about deficits and cuts, that's not what we're about. That's not what we do," Rainey said. "And we don't have any say about that and shouldn't have any say about it."

The board can consider only how much money the state will bring in, not how money is spent, he said.

"What we are faced with right now, gentlemen, is that we've had a trend that started in May, which is clearly negative," Rainey said. "At this point, it would not be prudent to do more, but it would be imprudent to do less or nothing."

The board will meet again Sept. 12 and decide whether another adjustment is needed.

Action to reduce the estimate only a month into the fiscal year stands in sharp contrast to last year, when a sharply divided Board of Economic Advisors could not agree to lower the estimate early in the budget year.

At the time, gubernatorial candidate Sanford criticized the board for not wanting to make cuts during the campaign.

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