By Bill Davis, senior editor | Some consider Gov. Nikki Haley’s recently released $7.5 billion executive budget for 2016-17 to be a template for the General Assembly’s coming budget-writing process. But others wonder whether the effort and attention that the governor’s plan gets is really is akin to spitting in the wind.
Haley’s budget outlines her spending priorities for $7.5 billion of projected state General Fund tax revenues. The fund is usually the smallest of three in the state’s annual budget, which also includes federal pass-through dollars and programs, as well as fees and “other” funds culled from everything from state college tuition to driver’s license fees.
Haley’s major budget priorities would steer an additional $394 million for roads projects, while cutting $131 million for state income tax in the first year of a 10-year cycle to offset an expected increase in the state’s gas tax. The executive budget proposal also includes $300 million for K-12 education, which includes stabilizing base student costs.
Haley also identified three problem areas in state funding for the year and the future: the rising costs of Medicaid, the need to address cuts to a fund to help offset local government costs and a state retirement system that is underperforming.
There are no promises that the legislature will take up any of her spending initiatives, though Haley had success last year in increasing state per-pupil spending on K-12 education funding.
Campbell first to unveil executive budget
Old timers in state government have long referred to executive budgets as conceptual documents that have little effect on the state’s actual budget. Judging from history, a governor’s real budgetary power comes at the end of the legislative process via line-item vetoes that can only survive by super-majority vote in each chamber of the legislature.
The tradition of having an executive budget at the start of a session began during Gov. Carroll Campbell’s tenure as he worked to restructure state government to a more executive branch-friendly model. But, even then, Campbell’s budget was less than 10 pages long, in stark contrast to Haley’s voluminous 700-page issue.
Former Gov. Jim Hodges this week said the legislature viewed his second executive budget as a “starting point,” but that his first budget was roundly ignored.
“But that was because the budgeting process was already well under way and I was just coming to it,” he said.
By defining his budget as merely a starting point, Hodges’ offering was given more respect than efforts by his successor, Mark Sanford, in the legislature.
Hodges said he, Campbell and predecessor David Beasley were given more budget attention than Sanford, because they each had come from the legislature and “knew its rhythms,” whereas Sanford came from the private sector.
“Every governor worth their salt puts some new items in the budget,” said Hodges.
Sanford’s budgets largely ignored
One of the reasons Sanford’s budgets were afforded little attention, according to Dan Cooper, was that his numbers didn’t make sense.
Cooper is the former chair of the House Ways and Means Committee, the body that formally starts the budget process every year before it heads to the full chamber, where it then ping-pongs back and forth between the Senate and House before going before the governor’s veto pen in June.
“His figures never matched anyone else’s figures. They wouldn’t work, and we couldn’t believe them,” said Cooper, now a lobbyist for an Upstate technical college.
Cooper praised Haley as more of a “realist, and as such, her budgets are taken much more seriously.”
Several legislators echoed Cooper’s observation that Haley’s budgets have been welcomed more in the General Assembly than Sanford’s.
Lawmakers probably won’t release reins
State Rep. Brian White (R-Anderson) now sits in Cooper’s old office at the helm of Ways and Means. Taking a break from the beginning of the budget process in the House, White offered mixed praise for Haley and her budget.
“We have taken and used some of her budget ideas in the past. She’s impacted the routine,” said White, adding that the governor has a several-month jump on the legislature.
Haley began her budgeting process in June, right when the legislature is letting itself out for the summer and fall. As such, she’s got a bully pulpit and releases a number that, according to White, hangs in the air and gets lots of press “because it’s a slow time of the year, news-wise, for the legislature.”
White said the element of the executive budget that improves its relative success is the willingness of the author to work with the legislature. Haley started out her first year in a smash-and-bash style, like Sanford, but she soon mellowed, according to White.
Last year’s executive budget was seen as a bit of a hiccup, as she bashed a legislative bond bill, but later in the session asked for an $123 million bond to successfully lure Volvo to the state.
White blanched at hints of changing the legislature’s budgeting process, such as giving the governor the ability to set the maximum a department may receive at the outset.
“South Carolina is a legislative state,” he said. “We’ve been budgeting like this for a while, successfully, and I don’t see why we should change. There are states that like the way we do budgeting, and so does Wall Street, judging by our state’s triple-A credit rating.”
State Sen. Vincent Sheheen, the Camden Democrat who tried to bolster the governor’s role in the budgeting process in a restructuring bill introduced two years ago, said it was a “myth” that South Carolina was still a legislative state.
Creation of a budgeting office within the governor’s cabinet as his bill envisioned would allow a governor to be better able to offer budget “suggestions” to the legislature, he said.
But, Sheheen, who twice ran against Haley for governor, said it would be wrong for Haley, or any other subsequent governor, to have authority over the budget.
“It is a cornerstone in American politics that the politicians closest to the people write the budget and for the governor to ‘execute’ the budget,” he said.
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