News and Press Releases for January 2006

Back to January 2006 Releases

01/26/2006

Gov. Sanford, Legislators Introduce Spending Cap Proposal

'Taxpayer Empowerment Amendment' Would Let Voters Decide on the Future Rate of Government Growth

Columbia, S.C. - Gov. Mark Sanford and legislators from the House and Senate today formally unveiled the "Taxpayer Empowerment Amendment," a spending cap proposal that would let voters decide on the future rate of government growth. The proposal would put a Constitutional amendment on the 2006 ballot and allow the people of South Carolina to decide whether to cap future government growth at a rate of population plus inflation - with the excess rebated to the taxpayers. If successful, the Amendment could not only result in millions being sent back to the taxpayers to fuel the economy, but would also result in a more sustainable government spending pattern that could avert future mid-year cuts and borrowings from trust and reserve funds.

"The bottom line is that we don't believe government should be growing more than twice as fast as people's paychecks," Gov. Sanford said. "Whether you agree with that principle or not, we think it's important to give the voters of this state a voice in the way government spends their money. Government should live within its means the way working South Carolina families and small businesses do, and we believe more money ought to ultimately end up back in the hands of hardworking taxpayers of this state where it will create jobs and economic activity."

Legislation will be introduced today in the Senate by Sen. Bryant, with legislation soon to follow in House. Under the proposal, general fund growth in any given year would be limited to growth in population plus inflation, with the excess refunded to the taxpayers the following fiscal year. To avoid budget shortfalls, the excess surplus would be held back during each fiscal year in the event General Fund revenue did not grow at a rate equal to population plus inflation. By doing this, the TEA proposal corrects flaws found in the Colorado spending cap model.

Had the Taxpayer Empowerment Amendment been implemented 20 years ago, roughly $6.6 billion would have been rebated to taxpayers over that time while still funding all core services. Additionally, there would have been no mid-year budget cuts during periods of economic downturn, no money would have been borrowed from trust and reserve funds and the state would not have incurred a $155 million unconstitutional deficit.