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Tensions rise over who decides how SC spends $1.9B in federal coronavirus aid

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Virus Outbreak South Carolina

S.C. Commerce Secretary Bobby Hitt (left) addresses the initial gathering on Thursday, April 23, 2020, of accelerateSC, a group tasked with advising Gov. Henry McMaster (back center), with task force leader James Burns and Lt. Gov. Pamela Evette (right) on safely scaling the state's economy back up amid the novel coronavirus outbreak. File/Meg Kinnard/AP

COLUMBIA — Gov. Henry McMaster has enjoyed something his predecessors did not: A good relationship with the S.C. Legislature.

But the camaraderie is being tested over control of $1.9 billion in federal coronavirus relief money.

Lawmakers approved a measure Tuesday giving themselves sole authority over spending the money for everything from schools to hospitals. But the cash, however, came to McMaster, who has a recovery task force that is deciding how to help the state through the pandemic.

McMaster could block the Legislature's bid for control by vetoing a deal meant to keep state government operating after June 30.

The rub is that lawmakers want to write and pass a COVID-19 budget bill through the normal legislative process — which is not speedy. Legislative leaders pledge to work quickly on this one and intend to pass it next month.

Waiting for the money are state agencies and local governments, who want to spread some of their share to small businesses. 

"The (Coronavirus Aid, Relief and Economic Security) Act funding exists for one reason — to help return the state of South Carolina to physical and economic health as quickly as possible," said McMaster's spokesman, Brian Symmes. The governor is "more than happy to work with the General Assembly in this effort, but the normal budgetary process is one that is not built for rapid delivery of resources."

The tussle threatens what has been a productive relationship between McMaster and lawmakers, who have agreed on a number of issues, notably education funding. That's a shift from McMaster's predecessors, Nikki Haley and Mark Sanford, who were more adversarial with the state's budget writers. 

While the federal government is very specific on how that $1.9 billion can be used, the allowed possibilities vary widely and change almost daily. They include virus testing, employee overtime, protective equipment, sanitization costs, supporting historically black colleges, summer learning camps and bringing high-speed internet to areas where students lack the ability to do their classwork online.

One thing not allowed is using the money to plug budget holes due to the economic shutdown. 

Congress distributed the money to governors nationwide. Part of the accelerateSC task force that McMaster created is focused on making recommendations on how to spend it. 

But a single sentence inserted Tuesday ensures the Legislature retains power over the state's purse.

It was inserted into legislation that keeps state government running past June 30 when the new fiscal year begins without a state budget — the reason for the one-day session. Legislators intend to return in September to craft a 2020-21 budget, when the economic outlook will hopefully be more clear.

Now McMaster must decide whether to sign the legislation or veto it. Since it is a budget bill, he could also strike specific sentences. He has until midnight Monday to decide.

If he does veto any or all of it, the Legislature could return soon afterward to try to overturn it.  

A previous version of the continuing resolution required only that McMaster get approval from a legislative panel before doling out money — or, if time didn't allow, at least inform the group.

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But House and Senate leaders said many questioned whether that violated the state constitution.

"Appropriating money is the General Assembly’s job — probably the primary job," said Senate Majority Leader Shane Massey, R-Edgefield. 

House Minority Leader Todd Rutherford agreed. 

"I don’t think the Legislature can disregard its obligations under the constitution to do exactly that," said the Columbia Democrat. "That’s our charge. It's a legislative state. … This is what the constitution of South Carolina demands." 

Questions over the governor's authority surfaced Tuesday in both chambers.

The Senate spent more than an hour debating whether McMaster had the legal authority to issue continual states of emergency, which he's done since mid-March amid continued infections and deaths from COVID-19. By law, each declaration expires in 15 days. In their last act before adjourning, senators narrowly voted to send McMaster a message that he needs legislators' permission to issue more than one.

House Ways and Means Chairman Murrell Smith said Thursday retaining the Legislature's budgetary authority avoids unnecessary hang-ups over whether the governor can legally allocate money.

"Is it really worth our time to debate that? We don’t need to get bogged down in debates and suits that could slow down our recovery," said the Sumter Republican. "The citizens of this state expect us to take action and take action quickly.

"We’re in an unprecedented time of crisis and someone has to be the leader, and that’s the governor," Smith continued. "I see our role as to vet the recommendations of the governor and his task force, and then let’s get the money to where it needs to go." 

The accelerateSC panel focusing on the federal money expects to make recommendations by the end of the month, said its chairman, former Sen. Greg Ryberg of Aiken. 

Sen. Tom Davis, a member of accelerateSC, said he's hopeful the Legislature is up to the task. 

On the plus side, holding public budget hearings and getting more points of view "increases the likelihood it will be spent in a good way," said the Beaufort Republican. 

But the flip side of that is the potential to get "bogged down in a deliberative process," he said. "We've got to act with dispatch. It can't be business as usual. I'm cautiously optimistic because everybody understand this money was provided for immediate relief."

The $1.9 billion, which arrived in state coffers last month, is just one of many pockets of money flowing into South Carolina from the Coronavirus Aid, Relief and Economic Security Act. 

Other pockets of federal aid bypass McMaster and legislators altogether. That includes $216 million for K-12 schools. The continuing resolution approved Tuesday spells out agencies must publicly disclose how they spend money coming directly to them.   

Follow Seanna Adcox on Twitter at @seannaadcox_pc.

Assistant Columbia bureau chief

Adcox returned to The Post and Courier in October 2017 after 12 years covering the Statehouse for The Associated Press. She previously covered education for The P&C. She has also worked for The AP in Albany, N.Y., and for The Herald in Rock Hill.

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