The South Carolina House today begins debating a budget plan that cuts $104 million, ends the AIDS drugs program, chops mental health funding and reduces the number of allowable Medicaid prescription drugs. The House budget staff was at the Statehouse over the weekend to help prepare any amendments that lawmakers need before the debate begins.
State revenue is down 6.4 percent compared with last year. Year-to-date, since July 1, the state has taken in $247.7 million less than it did at this point last year.
House Minority Leader Harry Ott says as dismal as this year’s fiscal picture is, next year will be much worse. That is when the state finds itself a billion dollars short.
“We are in a tunnel. The light we send at the end of the tunnel is not one we want to see. It’s a freight train coming directly at us and we’re going to collide this time next year.”
(Ott on budget debate MP3 2:35)
Ott on budget debate
Ways and Means Committee Chairman Dan Cooper says as bad as the situation is, a tax increase is not appropriate now considering the economy.
Ott says he doesn’t expect the committee proposal to change much on the House floor, because budget plans rarely change on the floor. He says a little money will be shifted but that’s likely it.
Ott says lawmakers who opposed the accumulation of reserve funds are fully to blame for the severity of the current crisis. He says it’s too late now to deal with the current crisis.
Chesterfield County Democrat Ted Vick says it’s important to note that South Carolina is much worse off than its neighbors. Vick says the problem comes down to Act 388 tax changes, which shifted tax revenue from personally-owned homes over to sales tax and income tax. He will propose legislation this week to change that.
(Vick on budget debate MP3 1:16)
Vick on budget debate
Orangeburg Democrat Govan said that a tax shift toward sales taxes at a time when the economy had taken a dive was not a responsible action, and caused a loss in revenue which will hurt essential services.