Here’s how we’re spending your money

Filed Under News, Uncategorized

By S.C. Senator Shane Massey

April 23, 2008

Spending your tax money is what we elected officials do. It is part of the reason you elect men and women to hold governmental positions. We’ve been doing that in the S.C. Senate, where we have finished work on probably our most important bill, the state budget. In May, we take up another significant bill, raising the cigarette tax, and deciding where to spend that money.

State Budget

When the Senate Finance Committee began working on the budget this year, the committee members expected that our tax revenues would fall about $50 million short of last year’s predictions. But earlier this month, the S.C. Board of Economic Advisors – those really smart people who estimate how much tax revenue the state will bring in – changed their prediction; they’re now estimating a shortfall of $90 million in our $7 billion budget. That’s quite a difference, and it sent the Senate scrambling to make cuts we didn’t want to make.

Nearly every state agency’s budget was reduced, and special projects all across the state were eliminated from the budget. We did keep a 1 percent raise for state employees, but my colleagues took the $20 million needed to fund the raises from money that was going to a trust fund for state retiree benefits.

That’s irresponsible budgeting. But it’s not unexpected, when you consider that legislators spent a $1.5 billion surplus last year, rather than saving for a rainy day. Now, it’s pouring rain, and we don’t have an umbrella.

The Budget will now go to a conference committee to work out the differences in the House and Senate versions, but it won’t ultimately change the budget picture for this year.

Cigarette Tax
Many of you have contacted me about the proposal to increase the cigarette tax, and I appreciate the input. Starting May 6, the Senate will begin debating the proposed increase. Most legislators are willing to raise the tax, especially since our 7-cent tax per pack is well below the Southeastern average of 37 cents.

The House raised the tax to 37 cents; the Senate Finance Committee has voted to raise it to 57 cents per pack. However, there’s no consensus right now within the full Senate on how much it will be raised, so we’ll have a great deal of discussion about that topic.

The other part of the debate is where we’ll spend the money generated from an increased cigarette tax. We’ve discussed some places to spend it, such as giving tax credits to small businesses so they can provide health insurance for employees to granting individual tax credits for low-income citizens to purchase health coverage on their own. Unfortunately, those plans failed in committee.

Instead, the Senate Finance Committee narrowly approved a plan to use the money to expand Medicaid coverage. That proposal, along with others that will be introduced, is where our debates will center.

We’ll see where it leads in the coming weeks.

In the meantime, if you have an opinion on these issues or any others, you can always contact me by telephone (803-480-0419), email (shanemassey@scsenate.org), or regular mail (P.O. Box 551, Edgefield, SC 29824). Or just pull me aside when you see me.

We are spending your hard-earned money. I want to ensure you know what we’re working on so we can find the best solutions to improve the lives of all South Carolinians.

Posted April 28, 2008 

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