CORRECTION: This report originally said 10 percent Medicaid matching funds would be required after 2017. The federal government will actually phase in the match beginning in 2017, but it will not reach 10 percent until 2020. We apologize for the error.
The 2013-2014 budget is now headed to the state Senate after the South Carolina House gave its final approval in a procedural vote Wednesday morning.
The $6.3 billion General Fund budget ($22.7 billion when including federal pass-through and “other funds”) first passed in a 110-8 vote Tuesday. That is roughly a $300 million increase in the General Fund from the current year. The budget will apply to the fiscal year that begins on July 1. It will likely be taken up by the state Senate in April.
House Ways & Means Committee chairman Brian White called it a “good” budget. “We improved education funding this year,” he said after Wednesday’s vote, “We also improved infrastructure by adding over $100 million this year to roads and bridges to take care of those issues within our state. We didn’t increase our debt. So those are some great highlights.”
Lawmakers also approved $113 million in spending from the state’s Capital Reserve Fund— $25 million of which would be used to improve cyber-security across state agencies and extend credit monitoring for those who sign up for the state-covered service.
Most of the debate on Tuesday dealt with Medicaid expansion. Democratic legislators spent five hours holding the podium during the debate, arguing for South Carolina to opt-in to the health care reform law and get federal aid that would allow more South Carolinians to be enrolled. But Republicans shut down the idea, saying it would cost the state too much once 10 percent matching funds are required after 2020.
House Minority Leader Todd Rutherford was not happy that the House rejected additional Medicaid funds. In a statement, he criticized the GOP for leaving money on the table that he claimed would go to other states, “People in states like New Jersey, California, and Illinois will be dancing in the streets when they find out that South Carolina sent away billions of their own tax dollars just to make a political point. Maybe they will send us a thank you card for our generous gift.”
But White responded that the state’s Medicaid budget was already growing by $156 million this year even without the expansion. “It doesn’t make a whole lot of sense to knowingly put yourself in debt three years down the road if there’s some things you want to care of… and the revenues are just not there to do that now.”
Some other notables include a $68 million increase for the state Department of Education, pay raises for prison corrections officers, and $12 million more for local governments than in the current fiscal year (although still not as much as a 1991 funding formula requires).
Even after the fight over Medicaid funding, only six Democrats and two Republicans voted against the final budget.
The House also voted to restore funding for face-to-face help at 17 rural unemployment offices around South Carolina. The state Department of Employment and Workforce (SCDEW) angered many legislators when it announced last month that, due to declining federal money, it would no longer offer the in-person help at numerous satellite offices in rural areas. The House approved budget provisos by Rep. Ted Vick (D-Chesterfield) and Rep. Nelson Hardwick (R-Surfside Beach) that would redirect $1.5 million from the Cabinet agency’s “administrative” line and instead direct it towards the rural employment centers.
“I understand (SCDEW) wanted to do some technology upgrades,” Vick said, “While I support them upgrading IT, we also need to have bodies there helping people.”
But some of the governor’s allies in the House called the move an overreach. “As we have allowed agencies to have a lot of latitude and flexibility, we should not take that flexibility away from SCDEW any more than we should take it away from the school districts or any other agency we deal with,” Rep. Bill Sandifer (R-Seneca) said.
But the House voted to go ahead with the funding change in a 66-42 vote. All 42 votes against the move were Republican.
In a narrow vote, the House also refused to expand solar tax credits. A person or business can currently receive a tax credit for up to 25 percent of the costs of installing a new solar energy system. Supporters had hoped to increase that to 30 percent, but failed to get a majority in a 56-56 vote. Legislators did not fall entirely along party lines, but Democrats were more likely to support and Republicans were more likely to oppose the additional credits.