Legislative leaders on the state's Budget and Control Board crafted a plan last year that would repay the deficit incurred during the 2001-02 fiscal year, as revenues fell below projections. That agreement has been approved by the House, and its approval by the Senate is listed as one of the legislative priorities of the remaining session by Gov. Mark Sanford.

State Treasurer Grady Patterson urged the Senate in a letter last week to commit $50 million to deficit reduction this year, as outlined in the Deficit Reduction Act. He warned that the loss of the state's AAA rating would be a consequence of faltering on the repayment plan.

"I certainly understand the tremendous challenge faced by the General Assembly in drafting a budget during these economically stressed times; however, we must not lose sight of our commitments to strong fiscal discipline and keeping our financial house in order," Mr. Patterson wrote.

Gov. Sanford makes a good case for doing more on the deficit, which he notes is unconstitutional, in the event that surplus money is available. The possibility of another $110 million, recently projected by the Board of Economic Advisers, could help the state wipe the slate clean. The budget approved by the Senate Finance Committee, however, hopes to use extra anticipated revenue for other purposes, including schools.

"The bottom line is we shouldn't even be thinking about a surplus for this coming year until the unconstitutional deficit from three years ago has been dealt with," Gov. Sanford said at a news conference Monday. "Very simply, the way I see it, there is no surplus as long as a deficit exists in this state."

The state's chief financial officer, Comptroller General Richard Eckstrom, has endorsed repayment of the deficit to the extent that surplus funds are available. "If we are fortunate enough to have a surplus this year, I recommend that we use it to pay off the $155 million of overdrawn checks that the state issued in 2001 and 2002," he said Monday.

While the AAA bond rating is critical in terms of low interest rates on bonds for the state, it also is considered a measure of the state's commitment to sound financial practices, which assist the state's efforts to attract new business and industry to South Carolina. The Legislature's commitment to retaining that rating is essential.

Meanwhile, the possibility of unexpected surplus revenues should encourage legislators to demonstrate real fiscal stewardship through deficit reduction.