Justices to rule on stimulus funds
COLUMBIA — Lowcountry schools could begin to feel a little budgetary relief as early as today if the state Supreme Court rules that Gov. Mark Sanford must step aside and let $700 million in federal stimulus funds flow into South Carolina.
Chief Justice Jean Toal told a packed courtroom Wednesday that the justices would weigh the arguments presented to them during a two-hour hearing that pitted education advocates against the two-term Republican governor.
The court is expected to make a ruling by Friday, but Toal's comments in court suggested Sanford would be on the losing end of the fight. The chief justice said the case was little more than a policy fight, one that Sanford lost when the Legislature overrode his veto striking the money from the state budget.
"He lost a legitimately engaged-in battle under the constitution of this state and the rest is purely ministerial, is it not?" Toal said.
The governor opposed the stimulus package from the start. He said he believes it will lead to inflation and saddle future generations with debt.
Congress intended for Sanford's role to be merely procedural in making an application to take the disputed $700 million portion of federal stimulus funds, according to Columbia lawyer Dick Harpootlian. He is a former state Democratic Party chairman and is representing two South Carolina students in one of three lawsuits over the stimulus feud.
The governor's counsel, Adam Charnes, a North Carolina-based lawyer who was executive editor of the Harvard Law Review while President Barack Obama served as the publication's president, said Sanford has the right and responsibility to use his discretion.
Sanford will not draw down the cash, which he argues is the only portion of the stimulus funds that he can control.
The Legislature tried to force Sanford to take the money last month. The governor then sued because he felt lawmakers were stomping all over the balance of power set forth in the state constitution. Education advocates filed two other suits to use the court to settle the dispute.
Sanford told the Legislature he would take the money if an equal amount of state dollars were used to pay down debt. He said that meant lawmakers needed to do a better job setting financial priorities.
Legislative leaders said that wasn't possible because the recession left the state so cash-strapped it would have a hard time operating public schools without the stimulus money. They also stressed that South Carolina taxpayers will be obligated to pay back the money even if the state never sees a dime of it.
The $700 million in stimulus money would be split evenly between the budget year that begins July 1 and the next one. The money is part of $2.8 billion designated for state government services, a total that could grow to $8 billion when factoring in all available tax breaks and grants.
Public schools, colleges and universities are to receive the bulk of the disputed funds, with less than 20 percent earmarked for law enforcement programs. Lowcountry school districts are awaiting the verdict.
Charnes, Sanford's lawyer, said in signing off on the cash, the governor would be agreeing to meet a number of federal demands. Taking the money is against his better judgment and to force him to do that would render the governor a robot set to follow the Legislature's direction, Charnes said.
Toal and the other justices tossed hard-nosed questions at Charnes, at the base of which was the governor's discretion. Toal said Sanford had exercised his discretion when he vetoed the budget and the Legislature overrode it. That action triggered an edict for Sanford to take the $700 million.