SC governor's proposed budget focuses on education

SC Gov. Haley releases budget proposal that puts much of additional revenue into education

Associated Press

COLUMBIA, S.C. (AP) -- South Carolina Gov. Haley's proposed budget for 2014-15 focuses on education with a $177 million increase to public schools while also providing most taxpayers a savings of about $30.

Haley released her $6.6 billion plan for state taxes Monday, one day before the legislative session starts. It comes a week after the Republican governor laid out her plans to improve education by focusing on poor, rural districts. Her three major education initiatives for the fiscal year starting July 1 would spend an additional $97 million on children living in poverty, $30 million on reading coaches in elementary schools, and $29 million on technology improvements.

Her proposal marks a major shift in her previous stance that education could be improved without any additional money. Her Democratic opponent, state Sen. Vincent Sheheen, has called it a convenient, election-year change, following her previous proposed cuts and vetoes.

Responding to her critics Monday, Haley said, "What else are they going to say?"

Haley's budget would also increase the so-called base student cost — a main funding source for public schools — by about $20, to $2,120 per child. It would cover projected population increases in charter schools, while also increasing what they get per student. It spends more on children whose primary language isn't English.

And it would provide about $20 million for new school buses — another change for Haley, who previously sought no money for buses, as she advocated privatizing the state's fleet. Last year, she recommended that the state sell all of its buses by 2017 and let districts either be fully responsible for running their own buses or contract for services. The idea again went nowhere.

Despite her request, she said her opinion on privatizing hasn't changed. South Carolina is the only state to own and maintain a statewide fleet.

"I will forever think we need to privatize," she said. "I still believe that's the way to go."

As expected, Haley's budget would not increase taxes. The additional spending would come from tax collections that are higher than last year's estimates. State economic advisers expect more than $265 million in new money in 2014-15. Adding expected one-time money means more than $400 million is available.

The Republican governor again proposes cutting personal income taxes by $27 million, giving most taxpayers an average savings of $29. Legislators did not follow that suggestion last year.

Most state employees would again see no pay raise. In the current year's budget, only officers in maximum-security prisons received a salary boost, of 3 percent. Her proposal would provide $57 million to cover expected increases in state employees' health insurance premiums, but their co-payments would go up again.

Only firefighters with the state Forestry Commission would receive a pay increase under Haley's plan. Haley said they should get a 2 percent raise because they were left out of the last round specifically for law enforcement.

State employees last received across-the-board increases in 2012-13, which marked their first such salary increase in four years. Most received a 3 percent boost then, though state law enforcement officers who made less than $50,000 got a 5 percent boost.

Pay increases are "not a given," she said. "It's not that we don't want to do it, but at the same time you don't suddenly spend more money on your household just because you want to."

Her plan would provide 25 additional people at the State Law Enforcement Division, 10 new officers with the Department of Public Safety and five more prosecutors in the attorney general's office.

It also would take about 1,400 people with disabilities off waiting lists for services through the Department of Disabilities and Special Needs.

She again rejected the idea of raising taxes for roadwork, saying the state must live within its means. She wants to fund road and bridge construction through tax collections that aren't yet projected.

Her budget is based on the Board of Economic Advisors' current predictions for tax collections. But legislators usually get more money to allocate when advisers revise their estimate in the spring. The difference could top $100 million.

Haley said that "money tree" could provide more than $1.3 billion over the next decade, if legislators continue that approach annually and use some of it to borrow. That would add to a law the Legislature passed last year that raises up to $1 billion over 10 years — a law that legislators of both parties recognize comes nowhere close to funding the need.

The state Department of Transportation estimates it will need $1.5 billion annually over the next 20 years just to get all of South Carolina's roads and bridges to good conditions.

"There's never an agency that ever has enough money," Haley said. "You can say, 'But I want more,' but that's also the kid at the end of Christmas when they've opened up all their presents saying, 'I want more.'"

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