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HOT ISSUE
1.09: Layoffs, service cuts loom
in budget
(Week of March 5, 2002)
MARCH 1, 2002 - - Lobbyists, citizens and state
employees are starting to understand what a proposed House budget
by the Ways & Means Committee could mean: layoffs at some already
hard-hit agencies, cuts in health care protections for the poor
and elderly and reductions in a variety of services.
The state faces a shortfall of up to $350 million
in funding to maintain next year's programs at the current level.
Agencies currently are operating with at least 4 percent revenue
following this year's mid-year budget cuts. Even though the state
appears to be heading slowly out of recession, the real impact to
the budgeting process has a lagging effect: there's less money coming
in, which means somebody is going to do without some services unless
revenues increase or agencies find savings. In these times, the
latter is unlikely as many agencies used one-time monies or reserves
to generate enough cash to meet the mid-year cuts.
Next week, House members will learn more about
the budget in a special briefing session at 2 p.m. Wednesday in
the Blatt Building in Columbia. It's open to the public.
Here's what they'll learn:
Medicaid. Poor children and the elderly
may face stiff service cuts. Because of rising costs of services
and a growing service population, the state Department of Health
and Human Services has to come up with an additional $185 million
to maintain services at existing levels . Two years ago, the state
raided tobacco settlement monies to generate $100 million in funds
to maintain the program. Last year, it generated a similar amount
by recouping from the federal government a share of services already
performed. But this year with state funds being extremely limited,
such one-time options are exhausted.
The Ways & Means proposal appears to generate
about $50-60 million in new Medicaid funding - about $130 million
less than needed. It gets only worse. If you consider the state's
portion of Medicaid funding is matched with three times as much
federal money, South Carolina is poised to lose up to $500 million
in Medicaid funds that pay for doctor fees, prescriptions and hospital
services.
Bottom line: if the current proposal becomes law,
a lot of South Carolinians are going to receive less or no health
services. More than likely though, health professionals, advocacy
groups and other agencies that receive spinoff funding from Medicaid
monies are going to kick into high gear to lobby for increases in
funding to ensure South Carolina is able to generate all of the
matching federal money it can.
Education. In the current budget year, K-12 education
absorbed a 4 percent across-the-board cut by resorting, at the local
level, to one-time monies and reserves, sources say. The proposed
House budget makes those cuts permanent. And that means, education
advocates say, a shortfall of more than $70 million. Because one-time
monies and reserves are dwindling, school districts may have to
hire fewer teachers next year and increase class sizes.
Mental health. The state Department of Mental
Health faces a $4.1 million cut of on a $183 million budget. At
first glance the 2.3 percent cut may not look like much, but considering
the agency has been involved in layoffs and is reducing its force
more now, additional cuts will cause more layoffs - - and stretch
services even more thinly.
Big cuts. Other agencies that face big cuts
include the Forestry (11.9 percent), Alcohol and Other Drug Abuse
Services (11.8 percent), Commerce (9.7 percent), Labor (8.8 percent),
State Library (7.2 percent), Archives (7.6 percent), Clemson Extension
Service (4 percent) and more. The House cut itself and the governor's
office about 4 percent. It didn't touch the Senate's budget.
No cuts. Several agencies appeared to receive
no cuts, including: Adjutant General, Election Commission, Commission
on Minority Affairs, Department of Corrections, Judicial Department,
Board of Technical and Comprehensive Education, and the Procurement
Review Panel.
Increases. Agencies that received increases
tended to be education or security agencies: Department of Public
Safety, State Law Enforcement Division, Department of Juvenile Justice,
Commission on Higher Education and the Department of Revenue.
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