South Carolina General Assembly

115th Session, 2003-2004

A256, R384, H4475

STATUS INFORMATION

General Bill

Sponsors: Reps. Harrell, W.D.Smith, Wilkins, Altman, Bingham, Ceips, Chellis, Clark, Cotty, Davenport, Edge, Frye, Gilham, Hagood, Hamilton, Harrison, Haskins, Hinson, Huggins, Koon, Leach, Limehouse, Littlejohn, Mahaffey, Martin, Merrill, E.H.Pitts, Quinn, Rice, Richardson, Simrill, D.C.Smith, G.M.Smith, G.R.Smith, J.R.Smith, Stewart, Stille, Taylor, Toole, Townsend, Tripp, Umphlett, Vaughn, Walker, White, Witherspoon, Young, Sandifer, Kirsh, Owens, Whitmire, Cato, Coates, Ott, Sinclair, Keegan, McGee, Perry, J.M.Neal, Emory, Pinson, Barfield, R.Brown, Weeks, Branham, Bailey, Battle, Neilson, Clemmons, Viers and Harvin

Document Path: l:\council\bills\ggs\22366htc04.doc

Companion/Similar bill(s): 854

Introduced in the House on January 13, 2004

Introduced in the Senate on March 9, 2004

Last Amended on May 25, 2004

Passed by the General Assembly on June 2, 2004

Governor's Action: June 14, 2004, Signed

Summary: Fiscal Discipline Plan of 2004, B&C Board/state budgeting procedures

HISTORY OF LEGISLATIVE ACTIONS

Date Body Action Description with journal page number

12/17/2003 House Prefiled

12/17/2003 House Referred to Committee on Ways and Means

1/13/2004 House Introduced and read first time HJ88

1/13/2004 House Referred to Committee on Ways and Means HJ89

1/14/2004 House Member(s) request name added as sponsor: Owens

2/19/2004 House Committee report: Favorable with amendment Ways and Means HJ3

2/25/2004 House Requests for debateRep(s).JE Smith, McLeod, and Scott HJ43

2/25/2004 House Amended HJ43

2/25/2004 House Debate interrupted HJ44

2/25/2004 House Requests for debateRep(s).Harrell, Cooper, J Brown, JR Smith, Loftis, Umphlett, Altman, Kirsh, and GR Smith HJ53

2/25/2004 House Member(s) request name added as sponsor: Whitmire, Cato, Coates, Ott, Sinclair, Keegan, McGee, Perry, J.M.Neal, Emory, Pinson, Barfield, R.Brown, Weeks, Branham, Bailey

2/26/2004 House Member(s) request name added as sponsor: Battle, Neilson

3/2/2004 House Member(s) request name added as sponsor: Clemmons, Viers

3/3/2004 House Member(s) request name added as sponsor: Harvin

3/4/2004 House Amended HJ29

3/4/2004 House Read second time HJ31

3/4/2004 House Roll call Yeas92 Nays0 HJ31

3/4/2004 House Unanimous consent for third reading on next legislative day HJ31

3/5/2004 House Read third time and sent to Senate HJ3

3/9/2004 Senate Introduced and read first time SJ14

3/9/2004 Senate Referred to Committee on Finance SJ14

4/7/2004 Senate Committee report: Favorable with amendment Finance SJ10

4/8/2004 Scrivener's error corrected

5/6/2004 Senate Read second time SJ31

5/6/2004 Senate Ordered to third reading with notice of amendments SJ31

5/6/2004 Senate Debate interrupted SJ31

5/12/2004 Senate Amended SJ37

5/12/2004 Senate Debate interrupted SJ37

5/19/2004 Senate Read third time and returned to House with amendments SJ73

5/25/2004 House Senate amendment amended HJ56

5/25/2004 House Returned to Senate with amendments HJ59

6/2/2004 Senate Concurred in House amendment and enrolled SJ35

6/3/2004 Ratified R 384

6/14/2004 Signed By Governor

6/24/2004 Copies available

6/24/2004 Effective date 06/14/04

6/24/2004 Act No.256

VERSIONS OF THIS BILL

12/17/2003

2/19/2004

2/25/2004

3/4/2004

4/7/2004

4/8/2004

5/12/2004

5/25/2004

(A256, R384, H4475)

AN ACT TO ENACT THE FISCAL DISCIPLINE PLAN OF 2004 BY DESIGNATING SECTION 6 OF ACT 356 OF 2002, RELATING TO ACTIONS NECESSARY FOR THE STATE BUDGET AND CONTROL BOARD TO COVER AN OPERATING DEFICIT, AS SECTION 1111180, CODE OF LAWS OF SOUTH CAROLINA, 1976, AND AMENDING IT TO REQUIRE AN OPERATING DEFICIT TO BE PLACED FIRST ON THE AGENDA OF THE STATE BUDGET AND CONTROL BOARD AT THE FIRST BOARD MEETING FOLLOWING THE COMPTROLLER GENERAL’S REPORT OF THE DEFICIT TO THE BOARD, BY PROVIDING FOR THE REPAYMENT OF THE ACCUMULATED STATE OPERATING DEFICIT AND TO PROVIDE THAT THE USE OF CAPITAL RESERVE FUND REVENUES TO REPAY A PRIOR-YEAR OPERATING DEFICIT IS A NONRECURRING PURPOSE WITHIN THE MEANING OF THE APPLICABLE CONSTITUTIONAL PROVISIONS, BY LIMITING GENERAL FUND APPROPRIATIONS GROWTH TO THREE PERCENT IN FISCAL YEARS 20042005 THROUGH 20082009 AND PROVIDING FOR THE USE OF SURPLUS REVENUES OVER THE SAME PERIOD, BY PROVIDING THAT THESE LIMITATIONS AND REQUIREMENTS NO LONGER APPLY WHEN THE FISCAL YEAR 20012003 OPERATING DEFICIT IS FULLY REPAID AND THE GENERAL RESERVE FUND IS FULLY RESTORED, AND BY PROVIDING THAT DURING THIS SAME PERIOD ANNUALLY REQUIRED TRANSFERS TO THE GENERAL RESERVE FUND MUST BE CONSIDERED RECURRING GENERAL FUND APPROPRIATIONS.

Be it enacted by the General Assembly of the State of South Carolina:

Citation

SECTION 1. This act may be cited as the Fiscal Discipline Plan of 2004.

State operating deficit

SECTION 2. Section 6 of Act 356 of 2002 is designated as Section 1111180 of the 1976 Code and is amended to read:

“Section 1111180. (A) By August thirty-first of each year, the Comptroller General shall report to the State Budget and Control Board the amounts of general fund revenues and expenditures recorded for the preceding fiscal year and any resulting surplus or deficit of the general fund from a budgetarybased perspective. If the Comptroller General determines that annual expenditures exceeded revenues, an operating deficit must be declared in the report and the State Budget and Control Board must meet to address the deficit within sixty days of receiving the report or earlier at any previously scheduled meeting. The operating deficit must be the first item on the agenda of the first State Budget and Control Board meeting held after the Comptroller General reports a deficit pursuant to this section.

(B) Notwithstanding any other provision of law, if the Comptroller General reports an operating deficit for the preceding fiscal year and it is determined funds are needed to balance the Budgetary General Fund after the use of the General Reserve Fund as provided in Section 1111310(B), the State Budget and Control Board is authorized to borrow the amount needed to balance the Budgetary General Fund by borrowing from any department of state government any surplus to the credit of the state department on hand in the Office of the State Treasurer. Upon approval by the State Budget and Control Board of a repayment schedule, the State Treasurer is authorized to transfer to the State Budget and Control Board from the general fund the amount necessary to repay the loan with interest no later than June thirtieth of the following fiscal year.”

Repaying deficit

SECTION 3. (A) At the close of the state’s 20032004 fiscal year, the State Treasurer is directed to transfer an amount up to fifty million dollars from the General Reserve Fund to partially offset the fiscal year 20012002 accumulated general fund operating deficit.

(B) To the extent balances in the Capital Reserve Fund for fiscal years 20042005 and 20052006 are available for appropriation by the General Assembly, as provided in Article III, Section 36(B)(2) of the Constitution of this State and Section 1111320, it is the intent of the General Assembly to offset any remaining fiscal year 20012002 accumulated operating deficit in an amount not to exceed fifty million dollars in fiscal year 20042005 and fiftyfive million dollars in fiscal year 20052006, if so much is necessary, as the first order of priority in the appropriation of the Capital Reserve Fund for the respective fiscal years.

(C) The General Assembly declares that the term “other nonrecurring purposes” pursuant to Article III, Section 36(B)(2) of the Constitution of this State includes operating deficits from previous fiscal years.

Spending limit; use of surplus revenue

SECTION 4. (A) In addition to all other applicable limitations on general fund appropriations and notwithstanding any other provisions of law, for fiscal years 20042005 through 20082009, except as provided in subsection (C), total general fund appropriations for the fiscal year may not exceed appropriations for the preceding fiscal year by more than three percent. The Office of State Budget shall certify to the Governor and the chairmen respectively of the House Ways and Means Committee and Senate Finance Committee the total general fund appropriations allowed for a fiscal year pursuant to this section. In calculating the limitation, there must be removed from general fund appropriations for the preceding year any amounts determined by the Office of State Budget to be nonrecurring. Before the Governor may submit the proposed budget for these fiscal years, the proposal must include the certificate of the Director of the Office of State Budget that the proposed budget conforms to the limitation imposed by this section. The annual general appropriations bill may not be given third reading in the House of Representatives and Senate unless a similar certificate is received by the presiding officer in each house from the Director of the Office of State Budget before the bill is given third reading.

(B) Notwithstanding any other provisions of law providing for the uses of surplus general fund revenues, for any fiscal year 20042005 through 20082009 for which the Comptroller General reports a surplus pursuant to Section 1111180(A) of the 1976 Code, to the extent any fiscal year 20012002 accumulated general fund operating deficit remains:

(1) the State Treasurer shall transfer to the appropriate depository accounts the amount of any surplus necessary to address any remaining fiscal year 20012002 accumulated general fund operating deficit;

(2) should any surplus remain after item (1) is accomplished, the remaining surplus must be applied to restore the General Reserve Fund to the amount required pursuant to Article III, Section 36 of the Constitution of this State and Section 1111310 of the 1976 Code; and

(3) should any surplus remain after items (1) and (2) are accomplished, the balance is deemed Capital Reserve Fund revenues and must be appropriated in the manner and used for the purposes provided by law for the Capital Reserve Fund.

(C) When the fiscal year 20012002 accumulated general fund operating deficit is repaid and the General Reserve Fund is fully restored pursuant to Article III, Section 36 of the Constitution of this State and Section 1111310 of the 1976 Code, the provisions of this section no longer apply.

Transfers deemed recurring

SECTION 5. For fiscal year 20042005 and through the last fiscal year to which Section 4 of this act applies, amounts required to be transferred to the General Reserve Fund established pursuant to Article III, Section 36 of the Constitution of this State and Section 1111310 of the 1976 Code, including amounts necessary to restore previously withdrawn amounts, are deemed to be recurring general fund appropriations except that these transfers must be subtracted from total general fund revenues before applying a percentage in calculating any spending formulas based on a percentage of general fund revenues.

Time effective

SECTION 6. This act takes effect upon approval by the Governor.

Ratified the 3rd day of June, 2004.

Approved the 14th day of June, 2004.

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