Here’s what S.C. constitutional amendments would do
COLUMBIA, S.C. (WIS)- During the Great Recession in 2008, South Carolina emptied out its reserves – and the Legislature had to make midyear budget cuts to keep the state running.
If that happens again – lawmakers say they want South Carolina to be better equipped to stave off those hits.
Now lawmakers are asking voters to give them the ability to do that.
When South Carolinians head to the polls – they’ll all see two questions posed to every voter in the state about requiring adding more money to state reserves each year.
Proponents of these constitutional amendments – who are asking voters to vote “yes” to them – say they’ll require the state to save more and spend less of its money.
“Without raising revenue, the state will put more revenue into its rainy-day funds to ensure it can meet the needs of running the state government in the event of an economic downturn,” said Rep. West Cox, R-Anderson.
One of the questions relates to the state’s rainy-day fund.
The other relates to its capital reserve fund, which primarily funds major capital projects.
Here’s what they mean.
The first question asks if the Legislature should increase the amount of money it’s required to put in its rainy-day fund from five-percent of the state’s revenue from the year before – up to 7 percent.
That’d be phased in over four years.
The second question asks if the amount of money required to go into capital reserve funs should increase from 2 percent to 3 percent.
It would also mandate that any money needed offset midyear budget cuts comes from this account first – before tapping into the larger general reserves.
If voters approve both of these amendments, the amount required to go into the combined reserves each year would jump from 7 percent of the annual revenue to 10 percent.
Neither of these proposals would raise taxes.
“I think everyone that has watched the news and has seen what the financial forecast for next year looks like can understand why it’s important to save for a rainy day,” said Bryce Fiedler of the South Carolina Policy Council.
The Legislature voted earlier this year to add these questions to the ballot.
Senate Republican Leader Shane Massey was the only lawmaker to vote against that.
He agreed the General Assembly should be saving more money, but argued this proposal isn’t the most responsible way to do it.
Massey said the capital reserve fund is not really a reserve fund.
“All that does is you keep it for a year before you figure out which projects you want to spend it on,” said Massey, R-Edgefield.
These are two separate questions to change the state constitution, so voters can vote the same way on both of them – or vote “yes” to one and “no” to the other.
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