• South Carolina: Gov. Haley Approves Budget for Fiscal Year 2015-16
  • July 30, 2015 | Authors: David H. Godenswager; David M. Kall; Susan Millradt McGlone
  • Law Firm: McDonald Hopkins LLC - Cleveland Office
  • South Carolina’s General Assembly ratified its budget bill H. 3701 for fiscal year 2015-16, overriding some of Gov. Nikki Haley’s vetoes. The budget is not quite final though; the South Carolina Policy Council (SCPC) pointed out that on July 6, lawmakers returned for a third week of extended session.

    According to the Aiken Standard, budget highlights include:
    • Roads: The budget distributes $216.3 million to counties for repair of existing roads. $70 million will partially fund promised roadwork for Volvo’s future plant. $50 million will sit in an account for future borrowing, which cannot be used until the legislature passes a long-term fix for roads.
    • State employees: $23.5 million provides a one-time, $800 bonus to state employees who make less than $100,000, to be paid in October. Another $34.4 million will cover increases in employees’ health insurance premiums.
    • School buses: The budget allocates a minimum of $21 million for new buses, but depending on lottery revenues, as much as $31 million could be available.
    • Department of Social Services: $8.5 million is to be used to hire 262 employees, mostly caseworkers and assistants, and to provide pay raises of up to 15 percent to help with retention.
    • Body cameras: $3.4 million will go into a fund that law enforcement agencies can apply to for their officers’ cameras.
    • Medical University of South Carolina: $25 million is apportioned toward a new, $350 million children’s hospital.
    • South Carolina State University: $4 million will be deployed to pay down some of the financially struggling school’s unpaid bills.
    WISTV.com noted that Gov. Haley vetoed 87 budget items worth about $30 million minutes before her deadline was up. These vetoes mostly concerned projects that are already funded from other sources. For example, according to the governor's staff, a $4.5 million evacuation route through Horry and Georgetown Counties is already paid for through the Department of Transportation.

    The SCPC is critical of this year’s “sloth-like pace” of the budget process; the group points to the fact that July 1, the start of the new fiscal year, came and went without a final budget. This even though lawmakers have just “one clear task to accomplish every year: pass a state budget.”

    Two problems the group cited are lawmakers’ refusal to consider the executive budget in joint open hearings at the beginning of session and their “tradition of wasting time on floor introductions and symbolic or otherwise pointless resolutions.”

    In addition, the budget process has turned into a vehicle for addressing every policy issue facing South Carolina. “In other words, lawmakers try to pass measures that won’t otherwise pass by putting them into the state budget.”

    The SCPC highlighted difficulties with transportation, education, and healthcare as three especially thorny areas. With respect to transportation, by only addressing it as a revenue problem and avoiding reforms that could improve infrastructure in a sustainable manner, lawmakers have been unable to overcome disagreements over tax and fee increases.

    Education became an issue in November 2014 when the South Carolina Supreme Court ruled that the state was failing to meets its constitutional obligation to provide “the requisite educational opportunity.” SCPC claims that because there is no evidence that funding increases improve education outcomes, lawmakers should reconsider the underlying educational policy. More specifically, they should implement a school-choice system involving vouchers or tax credits and tax credit scholarships, because the “failure of public schools doesn’t stem from a lack of resources but from their nature as quasi-monopolies that feature one-size-fits-all curricula.”

    Finally, the SCPC disparages lawmakers’ Medicaid expansion. It draws attention to the fact that South Carolina’s Department of Health and Human Services (DHHS), which administers the state’s Medicaid program and is largely funded by the federal government, will receive a $116 million funding increase in fiscal year 2016. Additionally, over $42 million in the DHHS 2016 budget is specifically designated to cover the cost of increased enrollment in Medicaid.

    SCPC insists there were no bills to repeal any of the 30 different insurance coverage mandates that increase health insurance costs. Nor was there traction on the repeal of the certificate-of-need laws, which require medical providers to get government approval before offering new medical services, purchasing certain medical equipment, or generally expanding the size of a healthcare facility.

    While the SCPC acknowledges budgetary action that could improve healthcare reform, it decries the lack of effort on that front as well.

    Ultimately, SCPC would like to see open debate where the budget is concerned, along with budget details that address South Carolina’s financial needs only. The budget is not a “tool for policy changes that might prove unpopular or politically difficult to pass openly.”