- Associated Press - Friday, February 20, 2015

MARION, S.C. (AP) - Marion County Administrator Tim Harper keeps wishing he could give county workers raises or hire replacements as some of his employees retire or leave. But he hasn’t been able to fill a seven-year hole in his budget caused when South Carolina lawmakers failed to follow a state law on local funding.

Harper and other county managers across South Carolina want the state to keep its promise to provide 4.5 percent of the last budget year’s general fund revenues to counties and municipalities, something that hasn’t been done since 2008.

But some of the chief budget writers in the House think that 1991 formula is an antiquated relic from the days budgets were done on paper instead of on computers. They have written a bill to change the formula that House Ways and Means Chairman Brian White said is more equitable and will make budgeting easier to predict. But it also would match what counties are getting paid now instead of what they are supposed to get under the old law.

It’s another fight in the long running battle between South Carolina and its 46 counties. County leaders don’t trust the Legislature to keep its promises after seven years of failing to fully pay for the local government fund. House leaders are unhappy that what they think have been good faith efforts to fix the problem.

“You can only work with people who want to be worked with,” said White, R-Anderson.

Meanwhile, a second bill that would restore funding for counties and cities to the levels required under the 1991 law over three-year period remains in a House committee.

The Local Government Fund’s intention 25 years ago was to help counties that struggled to collect taxes on a number of things like alcohol sold by minibottles. The state agreed to turn over 4.5 percent of the money collected from parts of dozens of different fees and taxes. The amount was set by the budget the year before because it was easier to figure out in the days before computers could gather and project revenue in a budget of billions of dollars down to the penny.

The Great Recession in 2008 showed the problem with that operation. Revenue went down in South Carolina, but the amount required by the fund didn’t. Lawmakers started failing to fully keep their promises.

Marion County has a $17.3 million budget for its 33,000 people. In the six years the fund has not been fully paid for, the county lost nearly $3.8 million in state money and little population growth has made it hard to raise more money, Harper said.

“The cost of equipment, supplies and material haven’t gone down since 2008. We’ve delayed buying new equipment as long as we can,” Harper said. “To get us back on track, we need that funding restored.”

Making the problem worse are limits on how much counties can raise property taxes under a 2006 property tax relief law.

Just up the road, Florence County Finance Director Kevin Yokim took a different tact, cutting budgets across the board as the state reduced its funding. The county lost deputies and paramedics. He said the county of about 133,000 people has grown, which has helped find some new revenue.

Yokim said the state likely gets a bargain from counties. The Local Government Fund also was established to help counties pay for state services like courts and social services. White and others have suggested if counties don’t like the new formula, the Legislature could make local governments submit exactly how much they pay for those services like other state agencies, instead of being given a set amount they could use for any purpose.

County managers across the state have said that could cause a major disruption to budgets and make an already strained relationship between legislators and counties worse. Yokim said part of the reason he doesn’t back the new formula is the Legislature’s failure to live up to its promises.

“Unless they are willing to lock it up in the constitution, there is no guarantee to that money,” Yokim said.

The House bill has bipartisan support. Rep. Leon Stavrinakis said once lawmakers stopped fully funding the old formula, it was doomed because it was antiquated and easy to ignore.

“This is a really good deal when you look at it where we are today, not where we were in 1991,”said Stavrinakis, D-Charleston.

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Follow Jeffrey Collins on Twitter at https://twitter.com/JSCollinsAP

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