- Associated Press - Wednesday, March 4, 2015

COLUMBIA, S.C. (AP) - The formula that South Carolina uses to distribute money to counties and other local governments for state functions like social services and courts would change under a House plan approved Wednesday - and the locals would get less than they had been promised under state law.

After a lengthy effort, the House passed legislation Wednesday to replace a 1991 formula that supporters of the new plan call an antiquated relic of a time when budgets were done on paper and lawmakers preferred to shove a block of money at a problem instead of itemizing expenses.

The 1991 formula requires the state to give local governments 4.5 percent of the previous year’s general fund budget. Under that formula, local governments would have shared more than $49 million. However, it hasn’t been fully funded since the Great Recession started in 2008.

Under the House bill, they would share almost $37 million. That’s only about three-quarters of what they should get under the current law, but it’s about what they have actually been receiving.

The formula is complex, but bill supporters said since it is tied to the budget that lawmakers are debating each year, counties will know exactly how much money they will get when they start to make their spending plans.

The money is to pay for counties operating functions required under state law like courts, the Department of Social Services and libraries.

The Legislature’s failure to provide all the promised funds in the past has opponents fighting the House measure.

Rep. Jonathon Hill said he can’t blame the counties for not trusting the state government, because the loss of promised money meant local governments have been forced to make decisions the state has avoided.

“Do they take the political repercussion of reduced services, or do they take the political repercussions of raised taxes? That’s something we’re not willing to do,” said Hill, R-Townville.

In the years counties have not been fully funded, they have lost the equivalent of nearly a quarter of their annual budgets. They have let employees go, frozen salaries and delayed buying new equipment. The problems have been made worse because state law limits how local governments can collect revenue.

House Ways and Means Chairman Brian White backed the bill. He said it gives counties a much more stable source of money that will rise as state revenues rise. He reminded lawmakers their job is to serve the state of South Carolina and not their local governments.

“We were all elected to take care of the needs of the state of South Carolina,” said White, R-Anderson.

The South Carolina Association of Counties sent a note to its members before the vote, warning that the House bill would cause significant problems with counties that already have had to cut a lot from their budgets.

“If proper funding is not received from the state to fund state services, then tax dollars must be shifted away from public safety and other county services,” the association wrote. “This endangers your community!”

The bill needs one more perfunctory vote before it will be sent to the Senate.



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