Agencies told to cut 3% more
State Education Department takes biggest hit
By Yvonne Wenger
COLUMBIA — Colleton County schools Superintendent Charles Gale thought he finally had things in order after cutting 39 positions, but more bad news rained down Tuesday.
SCstatehouse.net
"The implications of this are terrible," Gale said in reaction to the state Budget and Control Board's 3-2 decision to order state agencies to cut budgets by 3 percent in response to economic troubles.
Overall, the cuts equal $188 million and could be measured in the potential loss of Medicaid benefits, postponement of purchasing new school buses and increased work loads for state employees, as a number of agencies immediately announced hiring freezes.
The Department of Education will lose the most — $73 million — but local school districts will be the ones feeling the hit.
In Colleton, it is going to create as much as a $500,000 shortfall, leaving the district to turn to an already low emergency fund, Gale said.
"I was really fearful of these budget cuts," he said.
What it means for students and teachers? Larger class sizes and fewer resources, Gale said.
The district had to reduce its staff through attrition this summer to make up $3.8 million needed to meet the Legislature's mandated teacher salary increases. Now it faces additional problems.
Major impacts
The state budget board vote Tuesday means that S.C. agencies must cut spending by 3% — a total of $188 million. Among those hardest hit are:
Education Department -- $73 million
Health and Human Services -- $29 million
Corrections -- $10 million
Aid to local governments -- $9 million
Mental Health -- $7 million
Disabilities and Special Needs -- $6 million
Social Services -- $4 million
Juvenile Justice -- $3 million
State Superintendent of Education Jim Rex said the Education Department is going to do its best to minimize the impact of the cuts in the classroom. The agency already is reeling from high fuel costs that have eaten into money for the state's new 15-year school bus replacement cycle. Every 8-cent increase in diesel costs $1 million.
Tuesday marks the seventh mid-year budget cut the Education Department has taken since 2001, including nearly $97 million in December 2002 and $79 million in October 2001.
District officials for Berkeley, Charleston and Dorchester county schools also were scrambling to determine the fallout.
Brantley Thomas, executive director of finance for Berkeley County schools, said he does not have an exact amount but estimates the district stands to lose between $3 million and $4 million. To make up that much cash, the district will likely have to turn to salary costs, he said, and consider not replacing staff.
Michael Bobby, chief finance and operations officer for Charleston County schools, said the district is going to begin discussions right away to figure out how to address the cuts.
"This is a potentially very difficult, at best, condition it places us in," he said.
The district already made substantial reductions in expenses when it brought its current budget to the school board for approval, and has already dipped into reserves, Bobby said.
Gov. Mark Sanford, a member of the Budget and Control Board, argued for the Legislature to come back and prioritize spending, rather than issue across-the-board cuts.
"The governor thinks it's a really bizarre way to make policy to say German tourists are more important than state's schoolchildren," Sanford's press secretary Joel Sawyer said, taking aim at the Legislature's priorities and the funding of a controversial grants program.
Senate President Pro Tem Glenn McConnell, R-Charleston, said the cuts have more to do with the national economy, and inaction on the part of Congress to deal with the strain from fuel prices.
"This is a consequence of a failed energy policy in this country," McConnell said. The impact of rising fuel prices means people don't have money to spend, which in turn causes losses in state revenue.
McConnell noted that by a special provision, the Legislature could come back into session before the end of the year if the budget situation worsens. If that does not happen, agencies could put together recommendations for lawmakers to act on as soon as they return to session in January, with six months still left in the fiscal year. That would allow the state to make "course corrections," McConnell said.
State Comptroller General Richard Eckstrom, who along with Sanford cast the dissenting votes, said the Budget and Control Board's majority put the state agencies in a worse predicament than need be.
Having ordered the agencies to each cut 1 percent would have generated $63 million, enough, he said, to cover the projected shortfalls to date.
"We cut deep into some of these agencies," Eckstrom said. "I am sitting here scratching my head, what in the world were they thinking in that board meeting?"
At the Department of Health and Human Services, a 3 percent cut is $28.5 million in state funds. With the loss of federal matches, though, the cuts will cost the agency $95 million, said Jeff Stensland, director of communication.
The agency has several options to consider: cutting provider rates, cutting people from the Medicaid roles or reducing services, or a combination of those three things.
Meanwhile, the departments of Mental Health, Public Safety and Education, potentially among others, announced immediate hiring freezes.
The Department of Parks, Recreation and Tourism had been planning for the potential cuts by holding positions vacant and other measures to set aside 3 percent of its budget before the fiscal year began in July, said Marion Edmonds, director of communications.
Reach Yvonne Wenger at 803-799-9051 or ywenger@postandcourier.com.
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Comments
Smart_Enough_2_Know_Better (anonymous) says...
Yes, that's a great idea- cut education yet again. Here's a simple little formula for our Budget & Control Board to consider: smarter children = smarter workforce = attracts better/more industry/employers = greater tax base/more tax revenue = more prosperous state
Cut the non-ROI stop-gap measures like social welfare programs, not investments in our future.
August 13, 2008 at 2:01 a.m. ( permalink | suggest removal )
sig (anonymous) says...
DHHS should be cut $73 million not education. In fact DHHS should start all over. There is more than $73 million in fraud within DHHS every year.
Lack of educational opportunities increases the chance that they will need DHHS services in the future.
The states priorities are backwards again.
Smart Enough 2 Know better is right on.
August 13, 2008 at 6:11 a.m. ( permalink | suggest removal )
onedeep (anonymous) says...
The state could easily save money by moving state run offices to four-day work weeks instead of five.
August 13, 2008 at 6:48 a.m. ( permalink | suggest removal )
WhoCares (anonymous) says...
Yep, but when is a cut actually a cut? If your budget increases 6 percent at the beginning of the year and then you're told mid-year that you're being cut by 3 percent what it really means is that your budget only increased 3 percent. Problem is if you've already spent or committed the full 6 percent, now you must figure out how to cover the money you're no longer going to get. So, in actuality, instead of being "cut" their budgets are only increasing 3 percent for the year. But since they've already spent the full 6 percent, now they must scramble to cover the 3-percent decrease, or "cut."
The bottom line is this is yet another example of spending money you don't have instead of spending only what you have on hand. Is it any wonder we have a budget deficit??
August 13, 2008 at 6:59 a.m. ( permalink | suggest removal )
Paulie (anonymous) says...
Where's that budjet surplus that Sanford said to use for the upcoming deficit? Our elected Legislature voted to override his vetoes for their own agenda and now we're in a deep hole which could have easily been averted!
August 13, 2008 at 7:11 a.m. ( permalink | suggest removal )
lou9 (anonymous) says...
If all state agencies have to cut their budgets by 3% and education is hit the worst, then that tells you where the majority of your tax dollars are going each year. The educrats cry and cry each year for more money but they produce the same dismal results. They, along with all the other social programs are sucking up all the resources of this state. I don't want to see education cut but tough decisions have to be made in tough times. An across the board reduction in spending is the only fair way.
When was the last time any of you got a raise in your pay? How is your household budget? Are you having to cut back on your spending? I know I am. Where does the money for all these state agencies come from? That's right, our pockets. The legislature had an opportunity to do something about a potential shortfall when there was a surplus but chose instead to spend our money like there was no tomorrow. Well, tomorrow is here and we are broke. Now everyone has to pay the price and bite the bullet. I for one am voting against all incumbents this year. How about you?
August 13, 2008 at 7:36 a.m. ( permalink | suggest removal )
zoomru (anonymous) says...
"..Gov. Mark Sanford, a member of the Budget and Control Board, argued for the Legislature to come back and prioritize spending, rather than issue across-the-board cuts..."
MARK....its time to go POSTAL. Time for argueing is through! You need to go to Bi-Lo and get a couple of rolls of PORK sausage and leave them on Desks in certain CHAMBERS !! Give these so called Carolinians a SMELL of their OWN STENCH !! Take a picture an put it on YOUTUBE !!
GLENN and BOBBY...when you 2 get back from your GOLF VACATION on Jekyl Island; I hope your NOT caught .....SMILING ! It is hard for me to believe that you 2 would go on VACATION with OUR state in such distress !! WHAT..GALL !! You Ravenel'ers !!!
August 13, 2008 at 7:48 a.m. ( permalink | suggest removal )
Spartan (anonymous) says...
Good Job Budget and Control board! We need to smell the coffee: the revenue will not be there at end of the year so cutting the budget is better now than having a train wreck later. Mark Sanford, you now prove to me you are a show dog and not a watch dog along with your lockstep buddy Richard Eckstrom. I will never vote for either of you again should you run for anything. And Thank you for your vote to cut the budget Converse Chellis, a lowcountry CPA who understands budgets and Money. The rest of this crowd is not trustworthy with taxpayers money. Sanford needs to get off the airwaves and away from the camera and be a serious leader. He's back to the "sleeping in the office" trick to gain press and exposure. How about leading for a change? There's more waste in state and local government than pills in a drug store.
August 13, 2008 at 8:14 a.m. ( permalink | suggest removal )
nappyd (anonymous) says...
Maybe the state should stop giving tax breaks to businesses...
August 13, 2008 at 8:58 a.m. ( permalink | suggest removal )
charlestonpride (anonymous) says...
Start at the top. Take away their "state" cars, take away their "state" credit cards, take away their "state" funded fancy dinners, take away the "state" funded "business" trips, take away the "state" funded linen sheets of paper that they use to write their BS on.
August 13, 2008 at 8:59 a.m. ( permalink | suggest removal )
bigwhip (anonymous) says...
Our state payrollees have a soft cushy pad on easy street. Right on pride! The population in Columbia needs to be reduced by 10%; those on the dole need to go. I remind all that our pols gave away amost $32 mil to grants this year, not including the $100,000 gift for Germans to visit the grand strand. Do not vote for the incumbent.
August 13, 2008 at 9:13 a.m. ( permalink | suggest removal )
drp7773 (anonymous) says...
And they wait until September to realize this? Or was it until they got all the pet project money out of the system before they stepped up and made this call.
August 13, 2008 at 9:26 a.m. ( permalink | suggest removal )
CHRISJIII (anonymous) says...
Republicans in control of the White House + Republicans in control of the State House= deficits and misdirected spending!!!!
August 13, 2008 at 9:41 a.m. ( permalink | suggest removal )
bstairley (anonymous) says...
I doubt a group of people submitting their comments will make a large difference. I used to believe otherwise, but I am slowly becoming jaded. I read these comments everyday and I just shake my head. I don't want to start commenting on everything. 2 days in a row may be a bit much....
My 2 cents, which won't fix anything:
Any group in control will result in misdirecting and deficits. No group on the horizon is going to be able to come fix anything. It is the nature of big government.
Everything is connected-personal spending, energy policy, financial policy, political schmoozing.
All the funding comes out of the same bucket. We are in a recession. Everyone I know is having a harder time.
Schools can get by on less and there is waste. But they should have a reasonable budget and reasonable pay. It would be nice if they took a step back and had a good relationship with parents again. In some schools a LONG time ago, parents were a big help and would volunteer and the school let them. There was a home / school connection and both received a benefit.
I think reason has been thrown out the window in most areas.
August 13, 2008 at 10:02 a.m. ( permalink | suggest removal )
Lovely_One (anonymous) says...
bigwhip, you said exactly what I was gonna say. At least the German's get to visit our beautiful Myrtle Beach at our expense. Yep, $100,000 of our hard earned money going to make sure some foreigners get a nice vacation on us. Shortfall indeed!
August 13, 2008 at 10:10 a.m. ( permalink | suggest removal )
blackwoman (anonymous) says...
Well darn good thing the cigarette tax was VETOED. Those revenues certainly would not have been useful.
August 13, 2008 at 10:13 a.m. ( permalink | suggest removal )
whome (anonymous) says...
"And they wait until September to realize this?"
-----------------------------------------------
The state has been aware that the budget was going to be tight. This year's budget is actually less than last year's. For example, the COLA for this year was only 1%, not the typical 3%. What the state didn't expect was for revenue to completely fall off the cliff in June because of the combination of housing, energy, and credit. I suspect that July's preliminary numbers are scaring the heck out of the state, hence the dramatic 3% reduction. Like I posted yesterday, the state is not going to get out of this mess simply by cutting expenses; non-discretionary sales tax increases will be necessary.
"Well darn good thing the cigarette tax was VETOED. Those revenues certainly would not have been useful."
-----------------------------------------------
Umm. The cigarette tax would have been used to EXPAND Medicaid eligibility; it could not have helped out the deficiency that the state is facing.
This is the largest scale deflationary event in over a generation. Until government realizes it, we're really screwed.
August 13, 2008 at 10:28 a.m. ( permalink | suggest removal )
JD_Simms (anonymous) says...
Once again, we see statesmanship contrasted against the short-term planning horizons of the normal politician. Every legislator should be required to read and digest John F. Kennedy's historical accounts of this nation's great statesmen in his book, Profiles in Courage, to understand the difference.
Mark Sanford has been regularly and loudly banging the drum of fiscally sound LONG-TERM financial planning to legislators who can't see past their nose to the next election. He's warned about not spending one-time revenues for recurring programs:he's warned about the out of control unfunded liability in the State's retirement program:etc., etc.
All of this has fallen on the deaf ears of those who would rather authorize spending on pet programs that will buy them a good newspaper story and falsely impress the voters into thinking their representatives are doing good things. Forget about the fact that the money won't be there to pay for the program in the future, their planning horizon is short, so all they care about is if there's enough money to fund it until the next election. Disgusting.
We also see once again, sound budget management advice contrasted against a solution born out of pure sloth. As any business school in the country will teach, a blanket across-the-board reduction is NOT good financial management. As any fund manager or budget director will tell you, the correct way to face the situation the legislature has caused is to do in-depth analysis on a per program or per agency basis. However, this takes thinking capacity and a willingness to do tedious hard work. All attributes a good many of our forefathers possessed, but are severely lacking in most of today's politicians. It is much:MUCH:easier to wave a broad brush in one stroke in the form of an across the board cut, and then go play golf on Jykle Island. Disgusting (again).
Until we as a people start demanding our representatives adopt a long-term financial planning horizon, irresponsible fiscal management will continue. The fact that our legislators got us into this mess in the first place is one thing, but for them to exacerbate the problem with the irresponsible action the Budget and Control Board took yesterday is unconscionable. Any first-year business student can tell you this is extremely poor budget management and wholly negligent. In the real world, such reckless financial management would be met with a pink slip. I think this might not be a bad idea for most of our incumbents in the legislature. Maybe it is indeed time to fire them all.
August 13, 2008 at 10:29 a.m. ( permalink | suggest removal )
UrGatorbait (anonymous) says...
Smart enough said it best....
RW..duh duh duh duh huh
August 13, 2008 at 11:57 a.m. ( permalink | suggest removal )
STREETLAW (anonymous) says...
Why do same idiots keep getting elected? Because the State Election and State Ethics Commissions let incumbents get away with murder when it comes to the way election boards operate, and the lack of financial disclosure on the part of the candidates.
Politics in the State of South Carolina is a racket, a form of disorganized crime that benefits those on the inside while doing everything possible to stiffle dissent and real freedom of choice.
August 13, 2008 at 12:27 p.m. ( permalink | suggest removal )
MMitchum (anonymous) says...
Hey, here it is again...and we are doing what for illegals?
SC needs to be overhauled....get the greedy politicians looking out for themselves out....and true blue Americans in....cut our politicians PAY....1st...hows this sound...Then they get pay raises on their accomplishments...might make them work harder...start WITH THEIR MONEYYY!!!!!
August 13, 2008 at 12:37 p.m. ( permalink | suggest removal )
DoaMM (anonymous) says...
Newt wrote:
"RW - you are a none point - none brained individual. Go away."
Newt <-----Public School
Did you mean "...non-point, non-brained..."? Anyway...
The education system of this country needs to be overhauled...torn down and built from the ground up...
Who has the answers? Who can start AND accomplish this?
August 13, 2008 at 12:55 p.m. ( permalink | suggest removal )
charlestonpride (anonymous) says...
We need a Reagan clone.
Man is not free unless government is limited.
Ronald Reagan
Republicans believe every day is the Fourth of July, but the democrats believe every day is April 15.
Ronald Reagan
The most terrifying words in the English language are: I'm from the government and I'm here to help.
Ronald Reagan
August 13, 2008 at 2:12 p.m. ( permalink | suggest removal )
DoaMM (anonymous) says...
I wrote:
"The education system of this country needs to be overhauled...torn down and built from the ground up...
Who has the answers? Who can start AND accomplish this?"
Newt, where, oh where, in that statement is the "right wing party line", as you state? I asked a simple question to get people to THINK about the education system and didn't even mention a party!
But, at least I can now see which side you lean towards. Don't preach unless you're ordained or handle snakes really good, idiot.
August 13, 2008 at 2:13 p.m. ( permalink | suggest removal )
DoaMM (anonymous) says...
That's right, Newt, freedom of speech, baby!
But we've lost so many freedoms with all the laws and taxes created over time that we are no longer a truly "free" nation as our forefathers intended. Regardless of party affiliation, you should agree with this.
That being said, why don't you stop believing EVERYTHING that one party tells you? Gain some peripheral vision and you may see why being an independent is so much more beneficial.
August 13, 2008 at 2:47 p.m. ( permalink | suggest removal )
Smart_Enough_2_Know_Better (anonymous) says...
Newt- ignore RW. There is no actual thought behind any of his posts, just knee-jerk reactions based on what someone once told him to think. When he can't come up with an intellectual response, he just resorts to name calling. (Funny how virtually every one of his responses has some sort of name calling in it...) And everyone that disagrees with "his" mal-formed opinions? Automatically a leftist. Knee-jerk!
It's OK though- the world needs blind followers. I just think we should take away their internet privledges- don't need them slowing down the rest of us.
August 13, 2008 at 3:46 p.m. ( permalink | suggest removal )
charlestonpride (anonymous) says...
Newt...FYI The Politics of NCLB was started back in 1965 under Lyndon Johnson, called Lyndon Johnson's War on Poverty. It was revisited every 4-6 years until it was signed into law. It was a bipartisan bill. I agree with you, it's not worth the paper it's printed on.
August 13, 2008 at 4:23 p.m. ( permalink | suggest removal )
DoaMM (anonymous) says...
Newt, that's what I've been saying...get rid of partisanship...NO PARTY! I agree that it's broken and I don't know any other way to fix it than to vote differently next time. Just wait till the Gen-Xer's get into offices...
August 13, 2008 at 5:02 p.m. ( permalink | suggest removal )
lowcountrydawg (anonymous) says...
PFFFFFFFFFFFFFFFFFFFFFFf..........................
Oh, BTW, wasn't there a story on the highest paid state employees a couple of weeks ago?
Proved my point..................................
August 13, 2008 at 9 p.m. ( permalink | suggest removal )
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