Budget battle may be tame
Local government, education, health in crosshairs
By Bill Davis, Editor
MARCH 9, 2012 -- Despite vocal opposition from Gov. Nikki Haley, the House Ways and Means Committee proposed a budget for FY 2011-12 that won’t have a long list of debate points when it hits the floor of the House next week.
In fact, the biggest fight will likely not be about a cut or an increase, but over cities and counties receiving the exact same amount in state pass-along money they are getting this fiscal year.
House Minority Leader Harry Ott (D-St. Matthews) initially said there was not a lot to fight over this year, praising the budget-writers. Debate will start Monday on the floor of the House and will in a few weeks be sent to the Senate, where members of the Finance Committee have been already meeting on the 2012-13 spending bill.
Haley wanted to see more tax reform measures embedded in the budget, but will likely have to wait for the coming weeks when House Republicans unveil a series of bills created in an ad hoc committee led by moderate Rep. Tommy Stringer (R-Greer).
The $6.5 billion budget is laden with an extra $900 million not originally expected by forecasters. While the excess has come as welcome relief to some state agencies and programs stripped of vital funding during the Great Recession, it has created an interesting question: Why are some line items in the budget staying the same while state tax revenue coffers are growing?
Some areas may suffer
Under the committee’s proposed budget, the State Law Enforcement Division would be, percentage-wise, the biggest winner, with its base budget ballooning from $23 million to $40 million as legislators hope new funding helps the division regain its national accreditation.
Meanwhile, the Department of Juvenile Justice's funding would stay the same, as would appropriated money for the offices of the state's comptroller, attorney general and treasurer.
HOW TO SPEND $900 MILLION
With nearly $1 billion in new tax revenue growth for the coming year, how do members of the House Ways and Means Committee want to spend it?
- $300 million for Medicaid growth;
- $180 million to be set aside for deepening Charleston harbor;
- $152 million required by EFA K-12 funding formulas;
- $54 million to higher education and tech schools; and
- $16 million to SLED.
The remaining $200 million would be spread across state agencies and programs.
Perhaps the most glaring area for potential financing problems in a surplus year is the amount that committee members proposed dedicating to the Local Government Fund, which had been kept at close to 4.5 percent of the total General Fund Revenue until the recession hit.
But then it dropped from a high of $280 million in 2008-09 to $183 million in the current fiscal year 2011-12, according to the Budget and Control Board. For 2012-13, the proposed budget is exactly the same: $183 million. And according to that same set of analyses, the state budget hadn’t sent back to cities and counties that little since 1995-96.
All of this really bothers a swath of representatives, both Republicans and Democrats. Rep. Gilda Cobb-Hunter (D-Orangeburg) said she was especially upset.
Over the past few years, Cobb-Hunter said she understood why the fund shrunk. “It was because we didn’t have the money,” she said. “But now, we got more, and why aren’t we increasing the fund?” She feels that giving the same amount of money to the local governments is an ersatz cut in the face in many increases in other areas of government.
“Over the last three years, Orangeburg received less money, but we made it because we had prudent reserves. But it’s been three tough years and our reserves are gone.”
Cobb-Hunter said less money returning to counties and cities will directly affect hard-working constituents because their governments will see their bond ratings negatively impacted. And that could result in fewer services or higher taxes.
But, according to a Republican member of Ways and Means who didn’t want to be identified, raising taxes will be tougher, since the legislature has limited the number of ways a city or a county can raise revenues.
Cities, counties in crosshairs
Reba Campbell, deputy director of the Municipal Association of South Carolina, said many communities would be hard hit if the local government budget stays the same.
According to Campbell, the City of Anderson has seen its LGF dollars drop from $843,000 in 2008 to a $290,000 for 2012-13. During the recession, she said the city’s tax base also declined $400,000 and has had to rely on federal grants to keep its police and fire departments at the same staffing level. Those grants are expected to run out this year.
Considering the committee reported out the budget with a unanimous vote, where is the opposition to keeping the local government budget the same and the lack of tax reform in the budget Haley has been calling for?
One House staffer, working for an influential Republican and speaking on anonymity, said that, “representatives have been saying that they are keeping their powder dry for the floor debate.”
Another area of debate will be the funding of Medicaid, where Tony Keck, director of the state Department of Health and Human Services, wants to bring an additional 70,000 children under age 18 onto state health care rolls in preparation of the federal Affordable Health Care Act being fully operational in 2015.
Democrats, possibly led by promises to do so by Rep. Bakari Sellers (D-Denmark), will rise up on the floor to fight against the continued practice of under-funding K-12 education.
Crystal ball: Keeping the amount sent back to cities and counties now that there is more money in state bank accounts is a dumb idea in an election year. Representatives would be handing their opponents a brickbat. It will be increased, but not by great jumps; anything above $200 million would allow legislators and local pols to both claim victory and withdraw.
Budget, scrambling ahead
The House on Monday will begin floor debate on the budget submitted to it by the Ways and Means Committee.
The Senate will continue to scramble to fill the void left by Ken Ard resigning as lieutenant governor. The Senate will continue debate on a bill that would increase funding for charter schools, and another bill dealing with abortion and the upcoming Affordable Health Care Act.
Also on tap next week:
Senate Finance. A subcommittee will meet Wednesday at 9 a.m. in 207 Gressette to hear budget request reports from the departments of Disabilities and Special Needs, as well as from Social Services. Agenda.
Senate Judiciary. A subcommittee will meet once again on a bill that would limit tort claims on Wednesday at 9 a.m. in 209 Gressette. Agenda.
Senate Judiciary. A subcommittee will meet Wednesday at 9:30 a.m. in 307 Gressette to discuss bill that would create a statewide drug court, and a bill that would affect automatic sentencing for drug-related crimes. Agenda.Senate Ag. The full committee will meet Wednesday at 10 a.m. in 209 Gressette to discuss bills related to environmental regulations and civil liability. Agenda.
Call Comedy Central
Look for a huge shift in state Senate as leaders are expected to reshuffle chairmanships and responsibilities following the resignation and Friday indictment of former GOP Lt. Gov. Ken Ard.
Ken Ard, a quickly rising star in the state’s GOP firmament, has flamed out spectacularly. This morning, Ard, a former Florence County Councilman, turned in his resignation to Gov. Nikki Haley’s office. Haley released a bland statement offering support to his family and willingness to work with Ard’s replacement.
Ard had been the subject of an ongoing SLED and grand jury investigation stretching back to last year. He had already paid tens of thousands of dollars in fines to the state Ethics Commission for 107 counts of using campaign contributions on everything from clothing for his wife, a family vacation and a laptop computer.
Ard’s resignation was peppered with apologies and acceptance of fault. At 1 p.m. today, state Attorney General Alan Wilson and SLED director Mark Keel held a press conference in which they were to outline criminal ethics indictments against Ard.
Ard’s departure apparently is propelling long-time Sen. Glenn McConnell, R-Charleston, into the lieutenant governor’s chair. Click here to read a release by McConnell.
We’re still wondering, however, whether there’s some kind of procedural magic that McConnell will flick a wand that will send someone else into Ard’s purple robes and keep McConnell in the Senate. Time will tell.
Looking for the most recent great SC governor
By Andy Brack, PublisherMARCH 9, 2012 -- Someone asked a curious question this week: “Who do you think was South Carolina’s most recent great governor?”
Immediately, the name of Carroll A. Campbell Jr. came to mind. Campbell, a Republican who served for eight years after being elected in 1986, looked and sounded like a governor. He had authority and presence. He worked hard and did big things for the state, such as implement restructuring to state agencies and commissions, bring BMW to South Carolina and hunt for jobs across the world. And perhaps as interestingly, he persuaded a legislature run by Democrats to go along with him -- and even lured enough of them to his party over time so that the GOP took over the legislature by the time he was leaving.
Citadel political science professor DuBose Kapeluck also picked Campbell “partly because he set the stage for two-party competition at the state level.”
Another political science professor picked Campbell’s Democratic predecessor, Dick Riley, who was elected to two terms starting in 1978. Why? For his hard work to improve education and to recruit jobs, such as bringing Michelin to South Carolina.
A long-time observer of state politics also picked Riley for his education initiatives as “the way to improve the prospects for the state’s citizens” and for his “good work in resisting various bad ideas.”
Meanwhile, historian Jack Bass said the real answer might be a tie between the two Greenville natives, Campbell and Riley.
“Riley achieved a huge success both in winning a two-term provision for governor, the first time a governor could succeed to a second four-year term, and also emerged as a national leader in education reform with higher standards, funding and oversight, which led to his being named U. S. Secretary of Education,” Bass said.
“Campbell's success focused on his central role in bringing in BMW to South Carolina, a move that has transformed manufacturing in the state, and he played an equally central role in guiding the Republican Party into a position of dominance in state politics.”
Note the commonality in the answers? Campbell and Riley served two terms, unlike their successors -- Republican David Beasley and Democrat Jim Hodges. But oops, then there’s Mark Sanford, who many today see as having muddled through both terms as governor because of his lack of being able to deal in a friendly way with a legislature run by his own party.
Another commonality: Both Campbell and Riley were able to work with people to accomplish their goals despite the fact that South Carolina’s governor is considered to be among the weakest in the nation. Besides having a bully pulpit, about all that governors can do with the all-powerful state legislature is suggest budget priorities, use a line-item veto after the legislature approves the budget, hunt for more jobs and provide leadership to accomplish big things.
While Campbell or Riley might be the most recent great governor for South Carolina, it’s not difficult to look back a little more in time to find the best governor in the state’s modern history: Fritz Hollings, elected in 1958 when governors could serve only one four-year term.
While Hollings didn’t have to deal much with partisan politics of the Republican and Democratic ilk, he still had to wade through the waters of entrenched conservatives versus post-war reformers to get his agenda accomplished. He’s credited with bringing the governorship into the modern day by being the first to recruit businesses overseas successfully, by creating the environment for the successful integration of Clemson (and by thwarting attempts to make South Carolina a civil rights powder keg like Alabama and Mississippi), and by persuading the legislature to fund a transformational technical education system that became the envy of the country.
What Hollings, Riley and Campbell did was lead. They didn’t pussy-foot around to make incremental change or seek to appease small groups. They were bold. They worked to help all of South Carolina.
Incumbent Gov. Nikki Haley, who rightly is focusing on job creation, could learn a little by looking at how her predecessors led -- by working with people, not polarizing them against each other.
Andy Brack is publisher of Statehouse Report. You can reach Brack at: firstname.lastname@example.org.
S.C. Senate Democratic Caucus
The public spiritedness of our underwriters allows us to bring Statehouse Report to you at no cost. This week's spotlighted underwriter is the SC Senate Democratic Caucus. Organized almost 25 years ago, the Caucus has played an important role in many of the historic issues facing our state. As a vibrant minority party in the Senate, its role is to represent our constituents and present viable alternatives on critical issues. The SC Senate Democratic Caucus remains a unique place for this to occur in our policy process. Learn more about the Caucus at: www.scsenatedems.org.
Winning SC's teen pregnancy battleBy Sue Rex
Special to Statehouse Report
MARCH 9, 2012 -- As a board member of the South Carolina Campaign to Prevent Teen Pregnancy (SC Campaign), I was thrilled to hear about our state’s decline in the teen birth rate. However even in the wake of encouraging news, we must continue to work together to ensure young people have the appropriate education, resources, and community support necessary to avoid unplanned pregnancy.
As highlighted by the SC Campaign and reported by the SC Department of Health and Environmental Control, our state’s teen pregnancy rate is now at an all-time low. Our teen birth rate for 15- to 19-year olds is now 42.6 per 1,000, correlating to a 13 percent decrease from 2009 to 2010.
Today, I stand with the SC Campaign in congratulating young people for making responsible decisions. More teens today are choosing abstinence and those who are having sex are using contraception more consistently than in the 1990s. Our young people should be applauded as should the caring adults in communities around South Carolina who have invested their time, talents and, in some cases, their finances for the betterment of our youth.
I commend our leaders who have recognized teen pregnancy as a critical issue -- an issue that costs our state, on average, $197 million per year. Finally, I thank parents and other caring adults who are stepping up to the plate and discussing love, sex and relationships with their children. Research has proven that young people are more likely to delay sex if they have had open, honest conversations with a parent about love, sex and relationships, so it is encouraging that over 75 percent of South Carolina high school students report they are having such conversations.
While I am truly elated to see significant progress, South Carolina is currently ranked 12th in the country for teen birth rates and has no time for complacency. Thus, it remains important to look ahead and anticipate new challenges as we maintain current efforts across the state. Maintaining such efforts requires ongoing financial support at all levels as well as community investments of time, education, and opportunities for young people.
In the midst of tough economic times, we must remember that teen pregnancy is linked to many social disparities including dropout rates, academic success, poverty, child well-being, infant mortality and unemployment. Perhaps no other singular issue has the impact across a multitude of indicators of our state’s well being.
As a concerned citizen, you may be aware that teen pregnancy is an issue, but may not realize the impact it has on everyone in a community. Thus, it is important to understand that by preventing teen pregnancy, we are increasing a young person’s ability to finish school, become a productive citizen and avoid poverty which ultimately strengthens communities across our state.
Today, we can pause and celebrate the good news of declining rates, but we must never stop believing in and investing in our most valuable resource … our young people!
Rex, author of a dozen books and wife of former state Superintendent of Education Jim Rex, also serves on the board of the Southeastern Institute for Women in Politics.
False propaganda about Southerners
To the editor:
It’s so disheartening to watch, time and again, the Southern “heritage” being linked to flat-out untruths. David Whetsell’s letter about being Southern is par for the course. Since when is someone born in the USA of immigrant parents not “native born?” That’s part of the birther pack of lies. Our first five presidents were “native-born” (had to be, according to the Constitution) of parents who were immigrant non-citizens when they were born (because there was no USA in which to be a citizen). Several of those presidents were immigrant native-born citizens themselves, because they were born before the Revolution. “Native-born” has always meant born in the USA or a US territory or facility. It has nothing to do with the immigrant status of parents.
This false propaganda reminds me of the insistent description of the Confederate flag as a symbol of Southern heritage, with liberal references to “grand-daddies” and other nostalgic props. Fact is, the parents and grandparents of all those heritage buffs didn’t raise a finger when the Confederate flag was appropriated by the Klan to fly proudly over nightriders, lynchers and proud racists. That’s the flag’s heritage now. And thank God, most of the South has moved beyond it.
-- Susan Breslin, Folly Beach, SC
Might be good to increase state vesting age
To the editor:
Good article on the state retirement system. Just a minor point: Vesting does not refer to the point at which one is entitled to full retirement benefits. It refers to the number of years of service required before you are eligible for any pension at all, which in SC, is currently a mere five years.
So if that 22-year-old teacher worked four years for the state, and then left, she could withdraw her contributions to the retirement system with interest, but her employer’s contribution would stay in the pot, and she would never get a state pension. Once she reaches five years of service, she can still withdraw the funds (you can do that at any point); or she can leave the money with the system and collect a small pension when she reaches full retirement age based on salary and years of service.
One of the changes I was hoping they would make for new hires is to increase the vesting age to 10 years, as many other state retirement systems have done. But that doesn’t appear to be part of the package.
-- Holley Ulbrich, senior scholar, Strom Thurmond Institute, Clemson University
On demanding educational change
To the editor:
Your editorial on the problems with education should be required reading for everyone in this state -- to motivate them to demand a change!
-- Chris Brooks, Mount Pleasant, SC
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What a selection: House, Ard, Haley, more
Texting. The House made a great call when it passed a bill banning texting while driving. Next up, eating while driving, applying makeup while driving, staring at that cute thing in the next lane while driving? Probably not. More.
Ard. While it might be a good thing for the state that the drama over whether former Lt. Gov. Ken Ard would resign, now the state worry about South Carolina’s national profile being further dragged down. Do you know of another small state that makes this many crazy headlines?
House GOP. After promising not to affect those currently paying into the state’s retirement system, the House, lead by the Republicans, voted this week to include current employees into proposed sweeping changes to the state’s pension system. More.
White(s). Call it a tax credit all you want, but a bill giving families with kids in private school a tax break is a gateway to vouchers. The measure by House Ways and Means Committee Chairman Brian White (R-Anderson) would give families $4,000 per kid. Who is next, tax credit for cranky (voting) seniors who haven’t seen the inside of a school in years? When did education only benefit those in the classroom and not society at large? Hell, looking at our scores, when did the kids in the classroom get any real benefit? Hey, you cut per-pupil funding again with a proviso and claim you support education, Chairman White. Bush. League. More.
Haley. It’s one thing to slam House members who didn’t cut a budget you liked, but, Madame Governor, it’s another thing to fight with all your might against federal health care reform and then have the gall to have your Medicaid chief push for 70,000 South Carolinians to be added to state health care three years before they have to be. Transparent? You couldn’t spell the word. More.