News and Press Releases for October 2007

BEA PREDICTIONS PORTEND WIDESPREAD BUDGET CUTS, TOUGH SPENDING CHOICES IN COMING FISCAL YEAR

October 12, 2007

Columbia, S.C.

“Chicken Little again is roosting at the State House in this election year, with certain politicians up for re-election using the discredited "The sky is falling" campaign slogan. When you hear dire warnings about the state budget, you know the politicians have reached rock-bottom in trying to make themselves relevant.”

-- Senator Hugh Leatherman, May 3, 2006

– Governor Mark Sanford today issued the following statement on state economists’ predictions that the state revenue growth will go flat next year, something Gov. Sanford has warned state lawmakers of consistently over the past four budget cycles:

“Even from Biblical times you’ll find pharaoh’s dream of seven fat cows and seven skinny cows coming out of the Nile to show there are regular and predictable ups and downs that come with the business cycle,” Gov. Sanford said. “We’ve said from day one that during good times, we have to restrain spending to keep the state from being hit so hard when things slow down, because good times don’t last forever. Instead, government spending has grown by over 40 percent during the last three years. If these economic projections hold, some tough choices are going to have to be made in next year’s budget that are unfortunately going to have a negative impact for everyone served by our state government. We hope that this will serve as a wakeup call on the idea of institutionalizing spending restraint so that we don’t continue to find ourselves in situations like this every few years.”

The state will have to pay for $270 million in annualizations – ongoing expenses paid for with one-time money from this year’s budget – plus a minimum of $105 million more for education and $55 million more for Medicaid. That means the state will start the next budget year more than $430 million in the hole, before even figuring in other core needs like law enforcement, social services, and natural resources.