In a letter to South Carolina’s Senate and House budget leaders, Governor Mark Sanford stated his opposition to the FY 2010-11 Appropriations Act.
Sanford criticizes the legislature for initiating fees that are “backdoor tax increases” saying that “raising taxes to cover budget shortfalls is not good policy.”
…we would ask that you remove the proposals to raise roughly $45 million in new fees from the budget. We view these fee increases as backdoor tax increases and believe that raising taxes to cover budget shortfalls is not good policy. Given this year’s budget outlook, shouldn’t we instead conserve our limited state funds and allocate general fund revenue to only the most important functions of government? This is particularly true given the $1 billion hole in which the state will find itself next year. Otherwise, the easy answer next year will once again be to raise taxes to cover the shortfall. Nonetheless, the Senate’s version of the budget allocates state funds to programs as it has in the past, and makes up for the funding shortfall for core government services by imposing significant fees on taxpayers. I don’t believe economic opportunity will be increased for the people of our state by raising state government’s weight and cost.
Sources indicate the idea of the Senate increasing its operational budget is particularly galling to the governor. It’s a case of staff salaries going up while teachers and police officers get laid off.
[In] a year when nearly every agency’s budget is being slashed considerably, we respectfully cannot understand the rationale for increasing the Senate’s recurring base budget by over 52 percent. In last year’s appropriation act, the Senate had a recurring budget of $8,098,075, but the Senate-passed budget for this year appropriates $12,330,194 – an increase of more than $4.2 million. This sum does not even reflect the non-recurring $1 million the Senate is slated to receive for reapportionment.
Given the fact that teachers, law enforcement officers, and others are being laid-off or furloughed, we would respectfully request that the increased appropriations currently budgeted for the Senate be removed and re-appropriated for other critical areas. Although $4.2 million will not solve our budgetary problems, it can go a long way toward keeping more teachers in the classrooms and law enforcement officers on the streets.
On the theme of “spending money we don’t have,” Sanford told the General Assembly:
this budget is again simply spending money we don’t have. Last year we opposed a portion of the stimulus funds coming down to South Carolina because they would cause more damage to our state’s fiscal house in the future. We all now recognize that when the budget is being prepared this time next year we will have roughly $1 billion less to work with, due to the loss of stimulus funds. The $175 million that is included in Part IV will make next year’s budget hole $175 million deeper, and we have grave reservations about this. We believe a more fiscally prudent step would be to set aside $175 million to help alleviate the pain caused by the loss of $1 billion in stimulus funds next year. By setting aside this money the shortfall next year would be reduced by $175 million.
“As we have mentioned in the past,” Sanford wrote,”hope is not a method. We believe sound budgetary practices should rely on more than hope.”