What’s in The Conference Committee’s Budget?

UPDATE: The conference budget passed the House (84-28) and the Senate (30-9) on Thursday, June 28. The budget goes to the Governor’s desk next for line-item vetoes. 

HERE’S WHAT IS GOING TO THE FLOOR FOR A FINAL VOTE

Late Tuesday night (and only days away from the beginning of the next fiscal year), the legislative budget conferees finalized the compromise between the House and Senate versions of the appropriations bill. Here is an overview of what’s in it.

1.    Two data warehouses for tracking individual information

This proviso (117.156) would create a statewide personal information data warehouse. The proviso’s language is vague, the permissions are sweeping, and the accountability mechanisms are completely absent. The main purpose of this data warehouse is to track children and funnel them into the workforce.

The data will be used to “shape policy and funding decisions” on everything from preschool to the workforce, and will “link workforce, industry and education data” to meet the goals of the state’s economic development agency. It would be controlled by an unaccountable board of government officials, and lawmakers – and their staff – would have direct access to the information. (Read more)

Another proviso (102.3) first enacted two years ago created a Health and Human Services Data Warehouse, which compiles client information from the following agencies and entities:

• Department of Health and Human Services
• Department of Health and Environmental Control
• Department of Mental Health
• Department of Alcohol and Other Drug Abuse Services
• Department of Disabilities and Special Needs
• Department of Social Services
• Department of Vocational Rehabilitation
• Department of Education
• Department of Juvenile Justice
• Department of Corrections
• Department of Probation, Parole and Pardon Services
• Children’s Foster Care Review Board (housed within the Department of Children’s Advocacy)
• Continuum of Care (also housed within the Department of Children’s Advocacy)
• Office of the Lieutenant Governor, Division on Aging;
• South Carolina School for the Deaf and the Blind;
• Commission for the Blind

As this data warehouse is not a state law, but is only contained in the state budget as a proviso, it has to be reenacted every year. The provisions (including direct access for lawmakers and their staff) are nearly identical to the workforce data warehouse detailed above.

2.    Higher education spending moved off-budget

House lawmakers removed a large portion of public college and university spending from the budget. These funds are still being appropriated, but they are not reported in the final budget. These funds are comprised of tuition fees, athletic program revenues, etc. and total $3.7 billion – 13% of the entire proposed House budget. (Read more)

This artificially lowers the budget total, and prevents taxpayers from seeing the complete picture of public college and university finances.

3.    Allowing retired police officers to draw both pension and salary

This proviso (117.169) would allow retired law enforcement officers to draw both pension and salary if they agree to work as school resource officers in “critical needs” areas. Lawmakers have already tried this approach with a teacher incentive program. It was largely responsible for running up the state’s massive pension deficit, and in 2012 lawmakers passed a law to phase out the program, completely ending it by June 30 of this year. It is unclear why lawmakers would return to a program proven to have such disastrous financial consequences rather than simply increasing pay for school resource officers.

4.    Reducing debt service payments in favor of other projects

This proviso (112.1) would reduce the state’s debt service payments to the minimum amount required, and spend the rest on a new State Law Enforcement Division (SLED) lab ($54 million) and a variety of other projects (school buses, higher education facilities, the SC Children’s Theatre, etc.). Another budget proviso (112.2) would loan the Ports Authority up to $50 million from excess debt service funds.

While these provisos are proper for inclusion in the appropriations bill, the policy raises serious concerns. Lawmakers should be accelerating the process of paying down state debt, not slowing it down. The billions of dollars owed by various state agencies wield a disproportionate amount of influence over state policy, and practically guarantee that any form of tax reduction will be unachievable.

5.    Study committee to evaluate Santee Cooper

This proviso (117.162) creates a study committee to evaluate Santee Cooper’s assets and to consider the possibility of selling the utility. Of the committee’s nine members, eight would be legislators or their designees.

This is another example of trying to pass a stand-alone bill (H.4376) via proviso. The process of determining the future of Santee Cooper should be debated and voted on in an open, transparent process, not slipped into the appropriations bill after it failed to pass on its own merits.

6.    Counties must prove they are not sanctuary cities

Proviso 117.168 requires local governments to prove to the State Law Enforcement Division (SLED) that they are not sanctuary cities. SLED would have the power to investigate local governments’ compliance with federal immigration law, and would issue an “Immigration Compliance Report” to the General Assembly, the governor and the state treasurer. The state treasurer is instructed to withhold any remaining funding from the Local Government if any county or municipality is found to be in violation.

This is a particularly egregious example of circumventing the proper legislative process via budget proviso. It forces counties and municipalities to prove a negative, and is designed to prevent a problem that even the bill’s sponsor admits does not exist in South Carolina. The original bill containing this language H.4496 failed to pass as stand-alone legislation.

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The conference committee budget go before each house of the General Assembly for debate and an up-or-down vote on Thursday.