State economists Katie Turner, with the House Ways and Means Committee and Mike Shealy of the Senate Finance Committee gave an outlook on the state budget for Fiscal Year 2022-2023, an outlook that combined what Shealy, quoting Charles Dickens, said would be both “the worst of times, (and) the best of times”.
The briefing was held via Zoom and combined the annual COG Elected Officials Forum and the celebration of the 50th anniversary of the Catawba Regional Council of Governments.
In opening comments, Shealy posed a question to the forum attendees: “I was with everyone at the Gateway two years ago: if I would have told you that within several weeks we were going to have a pandemic…and two years later, we wouldn’t be able to meet because of a virus, the first thing you would have assumed was our economy is in trouble. Nothing could be further from the truth – we are on fire in South Carolina, and we have the potential revenue to prove it,” he said.
Shealy characterizes what has gone on in the state as a “time of dramatic contrasts,” quoting the opening lines from A Tale of Two Cities about the age of wisdom, age of foolishness, the epochs of belief and incredulity, the seasons of light and darkness and the spring of hope and winter of despair.
“I don’t know about you, but I’ve experienced all of those emotions, sometimes in the same day,” said Shealy. “Very difficult times, but also opportunities,” he said.
He showed a slide with the headline from a Washington Post article by Dan Keating, Akilah Johnson and Monica Ulmanu that mentioned a sobering statistic: ‘The pandemic marks another grim milestone: 1 in 500 Americans have died of Covid-19.’
The slide also showed some of the more recent numbers of deaths in South Carolina from Covid:
14,617 deaths in South Carolina from COVID-19 as of December 30, 2021. Shealy brought this into perspective by stating, “If that were a city, those numbers of deaths would be the same as the population of the 35th size city in South Carolina.”
He said the way the state reacted to the pandemic was to pass a series of appropriations, followed by a Continuing Resolution.
“We began our journey into this Covid era by passing a series of triage appropriations, followed by a CR. Now today we are in a much better place,” he said.
House Ways and Means Budget Director Katie Turner then took over the presentation. She walked viewers through the state’s first appropriation of $45 million for DHEC’s immediate needs, followed by the Continuing Resolution that continued the FY19-20 budget into FY20-21. In addition, $155 million was appropriated from the Contingency Reserve Fund to the COVID-19 Response Reserve Account for specific COVID-19 related expenses. Following that was an authorization by the legislature to spend federal CARES Act funds -$1.2 billion allocated and $668 million left for Phase 2.
In addition, there were two joint resolutions to appropriate additional funds: one was $63 million for DHEC, $45 million for MUSC, $100 Million was appropriated to a COVID-19 Vaccine Reserve Account with $75 Million for hospitals and $25 Million for other partners for vaccine delivery.
The other appropriation was to restore teacher step increases that were frozen due to the pandemic.
A one-time amount of $50 Million was appropriated for this purpose, and this was a one-time funding.
Going into the 2022-23 budget, there are several legislative priorities, Turner said, and the needs the legislature and their advisors hear most are: broadband, water and wastewater, reimbursement for lost revenue from the general fund (about $300 million) and the gas tax ($150 million).
The revenue outlook for the 2022-23 Fiscal Year comes from several sources and the state is looking at total revenue of $5.2 billion dollars to appropriate. Yes, billion.
“Don’t you feel like you’re swimming in money?” Shealy asked. “This will be my 40th year in state government. I’ve been doing budgets for a long time, most of them in state senate, and I’ve never seen anything like this before.”
Amidst all the euphoria of the state budget Shealy sounded a caution for state leaders: “We need to remember this is a temporary time, a very good time, and we will not likely see this again for a long time. As Chaucer coined the phrase, ‘All good things must come to an end’. I’m glad that Katie Turner used the word ‘transformative’ because that is what we’re hoping to be able to do with investments, because (this state of the budget revenue) won’t come along for a long time,” he said.
“We are in a transitionary time with regards to our economy…things could turn on a dime, just the way the pandemic made us turn on a dime the other way.”
By Brian Garner, Staff Reporter with The News & Reporter
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