March 16 , 2009
Highlights of the eighth week (March 1) and ninth week (March 8) of the S.C. General Assembly session include legislative action and activities on the state budget. Also, an update on the federal economic stimulus bill and 2009 omnibus spending plan are provided:
Economic Stimulus Bill
In the past few months, Gov. Sanford's criticism of President Obama's $787 billion economic stimulus plan has been well publicized. Sanford has warned that using stimulus cash for anything other than debt would only create longer-term budget problems.
In a three-page letter sent to state legislators last week, Gov. Sanford outlined his plans to write Obama a letter seeking a waiver that would authorize him to use the stimulus funds to pay off state debt instead of for roads, schools, unemployment benefits, Medicaid benefits and other programs.
If Obama does not grant the waiver, Sanford said he would not seek $700 million in stimulus funds. State legislators doubt such a waiver is possible or forthcoming.
The stimulus package is worth up to $8 billion to South Carolina including $2.5 billion in new tax cuts, $1 billion in extra Medicaid payments, $566 million for education, $558 million in unemployment benefits and $463 million for infrastructure.
Sanford says he only controls $700 million in stimulus funds, which is attributed in part to legislative bypasses crafted by U.S. House Majority Whip Jim Clyburn.
2009 Omnibus Spending Plan
President Obama has signed the $410 billion plan into law with almost $76 million of the $7 billion in "earmarks" coming to South Carolina. Sponsored by members of Congress, the earmarks must be posted on their Web sites for public inspection, and the measures should be discussed at public hearings. Of the $76 million, $950,000 will be used for expansion of the Myrtle Beach Convention Center.
Sponsored by U.S. Senator Lindsey Graham, the intent of the earmark has been fully disclosed. The funds will be used for the purchase and construction of the infrastructure necessary to support the development of the Myrtle Beach Trade and Convention Center. The benefits, including job creation and tourism growth, have been studied and analyzed. The project merits state and federal support.
The Myrtle Beach Convention Center attracts more than 170 annual events with nearly 550,000 attendees. The economic impact of the center exceeds $50 million annually. The facility also serves as a command center during the city's emergency operations and could be a pivotal investment in the future of Myrtle Beach and surrounding areas.
Today, the convention center is nearing full capacity, and expansion plans are long overdue. Once the expansion project is under way, it will create hundreds of jobs, which the area most certainly needs, and will help to attract even more groups and events to the Grand Strand.
The $950,000 is just a small portion of what is needed, but it will help to ensure the expansion gets started. Most of the funding needed for this project will come from the local community. Ultimately, the state and federal government will reap far more in tax revenues from this project than they will spend, providing a generous return on their investments.
State Budget (Fiscal Year 2009-2010)
The House gave key approval to a $6.6 billion spending plan that includes $1 billion stimulus cash to mostly erase deep budget reductions for health care, colleges and public schools and help soften the cuts to the other agencies. The bill is on its way to the Senate, where they will have to cut an additional 1.25 percent due to the Board of Economic Advisors lowering the estimate for the 2009-2010 fiscal year. The budget is so bare that it could force local governments to raise taxes.
While no funding is being offered for tourism promotion, $1 million is included for I-73 and I-74. Funding for the 2-for-1 matching grant program, although not budgeted, may be restored later in the session.
Budget Proposal:
- $5.6 billion (current budget: $6.7 billion)
- State sales tax collections are down to $2.2 billion from $2.6 billion
- Income tax collections are down to $2.6 billion from $3.2 billion
- Horry County will lose $4,972,976 in local government funds; Georgetown County, $1,411,171
- Coastal Carolina University gets some relief: proposal is $138.6 million total with $12.9 million in state funds, which is about $2 million more than this fiscal year
Sources: Information has been compiled from reports in The Sun News (Myrtle Beach), The State (Columbia) and the Hospitality Association of South Carolina
On the Net
MyrtleBeachAreaChamber.com
SCStateHouse.net
House.gov
Senate.gov
USA.gov
SCChamber.net
USChamber.com
I-73.com
